Universal Music Group removed all the music catalogue of its artists from TikTok on January 31st, over the two mega companies’ failure to reach an agreement on new licencing terms. This came amid the 2024 Grammy Awards week, one of the most notable events in the music industry for both music artists and executives alike.
The music of artists on the UMG label, like Taylor Swift who took home 2 Grammys at the 2024 awards ceremony and also became the first artist to win “Album of the Year” 4 times, Ariana Grande, Billie Eilish who took two including “Song of the Year,” Harry Styles, Olivia Rodrigo BTS, as well as older artists like Abba, the Beatles, and Bob Dylan, are now no longer available on TikTok. This also means that content creators can no longer add UMG’s artists’ music to their visual content on the platform.
According to Billboard, because UMG is the second-largest publisher in the world, and holds a considerable market share on the Pop Airplay chart as of the third quarter of 2023, this move by UMG is predicted to have a massive impact on the business side of the industry, that may even resurrect some memories of the significant effects of the WAG (Writers Guild of America) and SAG-AFTRA strikes on the film industry last year.
In an open letter to the ‘artist and songwriter community’, UMG alleged that TikTok had not agreed to pay fair rates for UMG’s music catalogue, had tacitly supported and created a framework for the rise of AI music to the detriment of the music of human artists, had not been firm enough in dealing with copyright infringement, had allowed hate, harassment, and bigotry on the platform, and had resorted to “bullying and intimidation” when UMG had sought to voice their concerns, “… TikTok attempted to bully us into accepting a deal worth less than the previous deal…not reflective of their exponential growth…. TikTok’s tactics are obvious: use its platform power to hurt vulnerable artists and try to intimidate us into conceding to a bad deal that undervalues music and shortchanges artists and songwriters as well as their fans.”
UMG doubled down with a Universal spokesperson saying in another statement the next day, “Our agreements with TikTok have expired because of TikTok’s unwillingness to appropriately compensate artists and songwriters, protect human artists from the harmful effects of AI, and address online safety issues for TikTok’s users,”
TikTok had hit back in a statement to Billboard, alleging that UMG were serving their own interests by pulling their artists’ music from the platform, though they declined to respond to UMG’s new statement, “…It is sad and disappointing that Universal Music Group has put their own greed above the interests of their artists and songwriters… 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. … Clearly, Universal’s self-serving actions are not in the best interests of artists, songwriters and fans.” TikTok further argued that other competing music labels and publishers such as WarnerMusic, whom they partnered with last July were able to successfully negotiate licencing agreements, while making artists the priority, “…TikTok has been able to reach ‘artist-first’ agreements with every other label and publisher…”
Many companies however threw their support behind UMG with the President & CEO of A2IM’s Dr. Richard James Burgess MBE, “We must stop sowing our seeds in barren soil. The returns artists and labels receive from TikTok are meagre and insufficient to sustain their livelihoods. We must advocate for systems where music’s intrinsic value is recognized, ensuring that platforms pay fair rates that reflect music’s role in driving their success and in building these colossal corporations…”
Wall Street analysts also seconded UMG’s decision, with J.P. Morgan analyst Daniel Kerven commenting in a research note that the label “had little to lose and much to gain,” in terms of relatively little monetary loss from pulling their catalogue.
This breakdown of negotiations between UMG and TikTok appears like it will also have impact on lesser-known music artists on the roster, something that UMG had cited as one of their reasons for NOT renewing their contract with TikTok, “… how did it (TikTok) try to intimidate us? By selectively removing the music of certain of our developing artists, while keeping on the platform our audience-driving global stars…”
Noah Kahan, a singer-songwriter whose song ‘Stick Season’ had gone viral on TikTok last year and topped the UK Singles chart, said that this development will negatively impact his ability to promote his music on the platform.
Cody Fry, another artist signed to a label belonging to UMG, acknowledged the magnitude of the two companies’ disagreement as one of his songs had gone viral in China simultaneously with UMG’s agreement ending with TikTok. He said that he had hoped that the two mega companies would have sorted out their disagreements without “leaving it to the expense of artists on the ground”.
Nonetheless, others also in the music industry note that there may still be a somewhat bright side to this disagreement, for the fostering and promotion of ‘real’ music from artists that is authentic and vibrant without the perceived kowtowing and coddling that TikTok allegedly tolerates from artists and big-name labels. Metro Boomin, an influential American rap producer who has worked with artists like the Weeknd, Post Malone, and Drake who are also on the UMG roster, noted on X that, “I love the creativity and appreciation…for the music on TikTok, but I don’t like the forced pandering from artists and labels that results in these lifeless and soulless records.”
This also seems to ripple across to other content creators on the platform who will not have that ‘easy’ access to the music to add to their visual content on the platform, as was the case previously. Some fans who were let dismayed at UMG’s decision had also jokingly mulled a move to Instagram Reels to access the music now unavailable on TikTok.
However, in an interesting observation @teambgv an Instagram account supporting and highlighting background vocalists put out a post on Instagram noted the possible golden opportunity for independent artists to fill in the music gap for content creators who rely on high-quality music for their visual content on the platform but also contribute to songs going viral.
Meanwhile, YouTube, who created Shorts about three years ago as the competitive equivalent to TikTok videos (though TikTok video duration time extended to 10 minutes in 2022), enjoyed a notable milestone this week with 100 million paid YouTube Music and Premium subscribers across the globe. Lyon Cohen, the YouTube Global Head of Music perhaps not so subtly said, “…Our superpower is our deep and collaborative relationship with the music industry. Our subscriptions business has confirmed that we have listened to our partners …being a good partner is being a good listener…”
Interestingly, Robert Kyncl, the current CEO of Warner Music Group, one of the big three music labels, who himself was formerly the Chief Business Officer (CBO) of YouTube noted that he understood the situation with the CEOs of the respective companies, and believes that UMG and TikTok can still resolve their differences, “I’m confident that they will – at some point – find an agreement because…music is incredibly helpful to virality and content. People when they’re creating content, they love trends, they love music… obviously, that’s valuable to a platform. Conversely, TikTok, YouTube, Reels – all of those platforms are obviously helpful to making music popular. We all love that on the music side. And [TikTok’s] user engagement is great…Obviously, I have an interest in [UMG and TikTok] working it out. I want them to work it out. And I think they’re both reasonable people that will find a compromise.”
While the complete impact of UMG’s fallout with TikTok is yet to be seen, it is one development on the business and content creation side of the music industry to be watched carefully as 2024 rolls on.