The news was revealed in a letter that Kobalt sent to its customers over the weekend. The company said it tried to broker a deal for its repertoire for a few months to no avail.
“Unfortunately, fundamental differences remained which we were unable to resolve in your best interest, and as a result, Kobalt’s directory is being removed from Meta’s services, including Facebook and Instagram, in the United States,” the letter read. “We have always championed songwriters first, and we are proud to continue to do so. We remain fully committed to reaching an agreement with Meta.
The consequences could be disastrous for songwriters signed with Kobalt. Kobalt represents African artists like Omar Lay and Burna Boy, among others. In September 2020, Mr. Eazi’s emPawa entered into a global agreement with Kobalt to provide royalty income and business to artists, allowing them to directly manage their rights and fees.
Globally, Kobalt claims to represent the songwriters behind over 40% of the top 100 tracks and albums in the UK and US. The removal of Kobalt’s publishing catalog could negatively impact several hits distributed and owned by all three major record labels – Sony, Universal and Warner – as well as independent rights holders around the world.
The news follows a lawsuit filed by Swedish music rights holder Epidemic Sound against Meta in the United States last week. The rights holder, who is valued at $1.4 billion, claims the ‘unauthorized use’ of his songs on Facebook and Instagram is significant and seeks more than $142 million in damages from the company due to the violation.
“Meta declined to enter into a license with Epidemic, even though Meta has done so with numerous other rights holders,” the lawsuit states. “Maybe Meta is hoping to get away with this as long as possible. Maybe Meta is hoping this will intimidate a company like Epidemic into bowing to Meta rather than incurring the disruption and expense of a lawsuit. Meta is wrong.
According to the last music in the air According to a Goldman Sachs report, Facebook contributed about 29% of emerging platforms’ advertising revenue paid to the recording industry in 2021. Meta, however, does not pay music companies based on the precise consumption of music on its platforms.