Universal Music Group (UMG) is threatening to pull all of its music from TikTok today after talks over royalties broke down, the company said in a statement. open letter. This means TikTok creators will lose access to songs by stars including Taylor Swift, Billy Eilish, The Weeknd, Drake and others.
When UMG’s deal with TikTok expires, the parties have reportedly been in talks for the past year. Such deals are worth billions annually to music publishing firms and are usually negotiated every few years. Universal is the world’s biggest record label, and if it pulls its music from TikTok, it will be the first time in recent memory.
Universal said it wanted to charge TikTok a fraction of the rate charged by other social media sites. “As our negotiations continued, TikTok tried to force us to accept a deal that was cheaper than the previous deal, far below fair market value, and did not reflect their exponential growth.”
In it own post, TikTok said it serves as a valuable marketing tool for artists and publishers. “Despite Universal’s false narrative and rhetoric, the fact remains that they have chosen to walk away from the strong support of a platform with over a billion users that serves as a free promotional and discovery tool for their talent.”
TikTok would also benefit greatly from access to Universal’s catalog and cut off access to ultra-popular artists like Taylor Swift, which would be a blow to creators and users. TikTok’s Chinese parent company, ByteDance, has more than 3 billion monthly active users and reported $29 billion in revenue in the quarter ending June 2023. The Financial Times. Warner Bros., the number three record label behind Sony Music and UMG. Music recently signed a deal with TikTok.
Universal said it “doesn’t appreciate what this means for the artists and their fans” but will not shirk its responsibility. “TikTok’s tactics are obvious: use the power of the platform to hurt vulnerable artists and try to scare us into making a bad deal that doesn’t value music and shortchanges artists and songwriters, as well as their fans.” The company added that payments from TikTok represent “only 1 percent of our total revenue.”