"TikTok is trying to build a music-based business, without paying fair value for the music," said Universal Music Group in its open letter that announced the two companies would not reach an agreement with the global licensing deal, which expired on January 31.
Universal Music Group published the open letter called "Why We Must Call Time Out on TikTok" on January 30, threatening to pull its songs from TikTok. Not many believed it at first, but the next day, UMG started removing its licenced music from TikTok. Taylor Swift, Ariana Grande, BTS, The Weeknd, Drake, Bad Bunny, and Harry Styles are just a part of the UMG’s roster whose songs are wiped off from the platform.
Videos that already contain songs of these artists are muted, as Music Ally reports.
The rationale behind the decision comes down to three points:
- TikTok doesn’t pay enough to UMG artists in comparison with other social platforms, despite living off music.
- TikTok caters to AI-generated content and doesn't protect artists from it. Universal Music Group, however, is crusading against it.
- The third concern was "online safety of TikTok users," which wasn’t a problem for UMG all these years. We remind you that TikTok was accused of infringing users’ safety several times before.
But there’s more. Universal Music Group claimed they refused to licence TikTok for both its recording music catalogue (3 million songs) and music publishing catalogue (4 million songs). So, starting January 31, millions of tracks are being removed from TikTok. And, if they appear on the platform after that time, Universal Music Group can accuse TikTok of copyright infringement.
Interestingly, TikTok is owned by ByteDance, a Chinese internet technology company, and Tencent, another Chinese company, acquired ten percent of Universal Music Group in 2020.
Funnily enough, all this is happening amidst the recent news of the TikTok Music launch, which might at least indicate TikTok's ambitions of becoming a music streaming service.
TikTok vs. Universal Music Group public beef
UMG claimed they wouldn’t renew the global licensing deal because "TikTok proposed paying [their] artists and songwriters at a rate that is a fraction of the rate that similarly situated major social platforms pay".
As per an open letter from UMG, TikTok "accounts for only about 1% of our total revenue," which, according to Music Business Worldwide’s calculations, is $110 million per year.
Regarding AI, Universal Music Group said that "TikTok is allowing the platform to be flooded with AI-generated recordings—as well as developing tools to enable, promote and encourage AI music creation on the platform itself–and then demanding a contractual right which would allow this content to massively dilute the royalty pool for human artists, in a move that is nothing short of sponsoring artist replacement by AI."
Then UMG added, "Today, as an indication of how little TikTok compensates artists and songwriters, despite its massive and growing user base, rapidly rising advertising revenue and increasing reliance on music-based content, TikTok accounts for only about 1% of our total revenue. Ultimately TikTok is trying to build a music-based business, without paying fair value for the music."
TikTok, in turn, accused Universal Music Group of "putting their own greed above the interests of their artists and songwriters."
"It is sad and disappointing that Universal Music Group has put their own greed above the interests of their artists and songwriters.
Despite Universal's false narrative and rhetoric, the fact is they have chosen to walk away from the powerful support of a platform with well over a billion users that serves as a free promotional and discovery vehicle for their talent.
TikTok has been able to reach 'artist-first' agreements with every other label and publisher. Clearly, Universal's self-serving actions are not in the best interests of artists, songwriters and fans."
TikTok & UMG dominance in music
All this drama wouldn’t be worth our attention if the companies weren’t literally the most influential players in the music industry, so this face-off surely will impact the entire business.
TikTok’s influence on music is huge. And there's plenty of data that proves that. According to TikTok's own report, the platform acquired 150 million users in the US alone as of Q1 2023. Luminate recently conducted a survey that revealed TikTok's influence on the whole music industry—from music discovery to having viral artists signed to major labels to merchandise sales.
According to The Pudding data essay on TikTok's impact on music, "of the artists who charted on Spotify from January 2020 to December 2021, 332 had never charted before. 25% of them came from TikTok."
"Over a year ago, every media outlet in the world seemed to be weighing in on her [Taylor Swift's] just-released song, 'Anti-Hero,' which took TikTok specifically and social media generally by storm. It’s okay if the song’s title means nothing to you because chances are the refrain 'It’s me. Hi, I’m the problem. It’s me' almost surely does.
This is how social media virality works. Something goes from zero to seemingly infinity overnight. It’s what fuels TikTok’s entire business model," says Amplify's chief strategy officer Aron Solomon in an email interview to Kill the DJ.
Universal Music Group’s dominance isn’t less. The company, the most major from the major triad, holds rights to nearly all world-renowned artists dominating the world top charts, including Taylor Swift, Bob Dylan, Drake, Elton John, Ariana Grande, Adele, The Weeknd, and hundreds more.
Massive sway for the whole music industry: for artists, creators, and fans
It’s been just three days into the drama, so the consequences for artists, labels, TikTok creators, and both companies themselves are too soon to predict. Make no mistake, though, that the impact will be huge. Here’s why.
A bit earlier, we told you that UMG deletes songs that belong to both its recording catalogue and publishing catalogue. We deliberately emphasised this because, in practice, it means the following: the face-off will affect every track which UMG owns and… represents a songwriting cut. Still unclear?
Songs that are part of publishing catalogue are typically recorded by artists signed to other record companies. One of the examples is Adele who is signed to Sony Music/Columbia for records, but signed to Universal Music Publishing Group with publishing. So, it means that her songs, as well as tracks of hundreds of other artists, might be removed too.
As Music Business Worldwide fairly notes, "now imagine a hip-hop or dance track with multiple writers and multiple samples. If a UMPG writer contributed just 1% of the songwriting credits to that recording, it too would need to come off TikTok."
So, the number of songs that might be affected is yet to be determined. One is clear: that'll be millions.
If Taylor Swift possibly doesn't even notice the change, smaller artists who sign up for UMG might face hard times.
One of the notes in UMG reads that TikTok is "selectively removing the music of certain [Universal-signed] developing artists, while keeping on the platform our audience-driving global stars," basically accusing TikTok of depriving small artists of the support they need so much.
One of such examples is Cody Fry whose song "Things You Said" only just started going viral on TikTok, a couple of days before it all fell to pieces. Fry, who then migrated to Instagram Reels (which is what all UMG-signed artists will now do) told Rolling Stone that "it just feels like I am nothing, like I’m just at the mercy of the machinations of these multibillion dollar corporations. I would be fully supportive of what UMG is doing — I think TikTok should pay more. TikTok has its promotional value, but then there’s also elements of TikTok and how they use music that feels a little bit exploitive. They have to negotiate and find a balance there. The bummer is that it feels like UMG and TikTok are both going to be fine. Meanwhile, the actual artists on the ground are the ones that are going to take the hits for this."
TikTok responded that they have been able to "reach ‘artist-first’ agreements with every other label and publisher." As of writing, TikTok has active licence deals with Sony Music Group and Warner Music Group (the remaining two majors), so artists shouldn’t be worried, TikTok reckons.
What’s more, indie artists who aren’t signed to UMG or are signed to other labels might see a great opportunity to get their music finally discovered on TikTok. Or that might mean the rise of remixes, mashups, manipulated sped-ups, reverb+slow downs and God knows what else on the short-video platform.
Some believe this face-off might set a precedent in the industry for fairer compensation for artists and songwriters, akin to the recent Hollywood screenwriters’ strike who protested against low wages and AI taking over their jobs.
What about TikTok content creators?
Well, even if the platform has secured deals with major music publishers, this confrontation won’t go unnoticed. TikTok will lose (rather, already started losing) the most popular music. Millions of videos going silent will lead to decreased engagement, views, and, ultimately, ads. Some creators will likely remove the impacted videos and upload new ones, though, but that will still take time to go viral, and it won’t leave their accounts' stats intact. Potential copyright infringement might also be an issue.
"TikTok has so much music that was created just for the platform. You don’t hear those 'songs' on the radio because they’re often not even full songs, they’re kind of little catchy musical notions that catch on so fast and become known around the world.
"If you’re one of these content creators, you need to be aware of the copyright implications when using music on TikTok. Generally, music available in TikTok's library can be used without the risk of copyright infringement due to the platform's licensing agreements with artists. However, using music outside of TikTok's library may lead to copyright issues, which anyone using Taylor Swift’s content on TikTok will now experience", Solomon says.
As of writing, fans are the least concerned ones.
"Unpopular opinion: UMG needs TikTok more than TikTok needs UMG," shares one Reddit user. Memebers of the r/musicians subreddit all write 'Hell yeah!" in the thread that begins with "How do you feel about Universal music group removing it's artists music from Tiktok?"
"Lowkey kinda funny scrolling and seeing muted thirst traps, dances, and edits though lmao but once the novelty of that wears off, it’s gonna suck. music was a big part of the app, i enjoyed seeing all the creative shit people do with it," shares another Redditor. "I trust the girlies to successfully use public domain music," adds another one.
And yet, fans will lose access to the tracks they love, which will surely impact music discovery and trends.
