YouTube users in the country had for years been confronted with a red sad-face emoticon and messages announcing "this video is not available in Germany" when trying to view videos ranging from the latest pop clips to films with GEMA-controlled background music.
Now the blockages should largely be a thing of the past.
"Hell has frozen over!" wrote one Twitter user in response to the news. "Listen to all the music!" said another.
Tuesday's deal will see YouTube pay an undisclosed amount for music belonging to the roughly 70,000 German artists represented by GEMA – as well as many foreign artists – each time their songs are played.
"Authors, composers and music publishers will be paid fairly," YouTube executive Christophe Muller said in a statement.
GEMA and the Google subsidiary had been wrangling since 2009 – at times in court – over how musicians should be paid for their work being streamed after a previous licensing agreement expired.
A court ruled in 2012 that YouTube should install filters preventing users uploading copyrighted music without permission – on pain of a €250,000 (RM1.1bil) fine per infraction.
But the latest court case launched by the music licensing organisation, in which it claimed €0.375 (RM1.75) from the video site for each time a song was played, failed in January this year.
Ten months later, the two sides have reached an agreement, although neither released details of the amount artists would receive per play.
"There was an appropriate, good offer," GEMA spokeswoman Ursula Goebel told AFP.
Citing industry sources, news agency DPA reported that the compromise would see YouTube send some advertising revenue to GEMA, as well as a fee for videos not preceded by ads.
GEMA said Tuesday's deal covers past as well as future usage of its members' music.
The two sides have however not agreed whether YouTube or the individual uploader should be responsible for licensing, it added.
Among the 1,000 most popular YouTube videos in the world in 2013, no fewer than 61.5% of them were blocked in Germany, according to data journalism agency OpenDataCity compared with just 1% in neighbouring France.
But just 8.4% of that list were blocked because of definite legal problems, while the rest were made unavailable as a precautionary measure.
Blocks on free music videos dismayed newly-arrived expats and prompted people to trade tips on getting around them to the latest clips from Lady Gaga or Justin Bieber.
Now GEMA says it has sent "a clear signal to all online platforms... authors must be fairly remunerated for the exploitation of their musical works," the organisation's head of broadcast and online Thomas Theune said in a statement.
"We in Germany think we can hold up for a while things that are already normal in other countries" in cases like GEMA's, Professor Klemens Skibicki, a digital economy expert at Cologne Business School, told AFP.
But "it's clear to the rest of the world that profit-making in the music business just works differently nowadays," compared with when record sales were the big earner, he said. — AFP Relaxnews
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