By Karl Quinn
TikTok has responded angrily to the decision by Universal Music Group to sever ties with the social media platform, accusing the music company of greed and self-serving actions.
The response came in a statement issued the day after the world’s largest music company went to war with the fourth-largest social media platform, when Universal announced it would pull its entire music catalogue from TikTok from February 1. The move is likely to have far-reaching ramifications for the music industry and fans.
London-based Universal Music Group – whose artist roster includes Taylor Swift, Coldplay, Bob Dylan, Kendrick Lamar and Billie Eilish – announced it was taking the dramatic step after failing to reach a new agreement with the platform.
Big flex: Is Universal’s decision to pull the music of its artists, including Taylor Swift, from TikTok a show of strength or a mark of fear?Credit: Invision
The existing three-year deal between Universal and ByteDance, the Chinese company that owns and operates the short-form video-sharing platform that now has an estimated 1.2 billion users worldwide, expires at midnight on January 31. From that moment on, no music from the extensive Universal catalogue can legally be uploaded or streamed on TikTok. Songs released by popular artists including Taylor Swift have been used in tens of millions of TikTok videos.
In its statement – published online on January 30 (UK time) under the headline “an Open Letter to the Artist and Songwriter Community: Why We Must Call Time Out on TikTok” – Universal accused the social media player of offering a deal that would result in the label’s artists being paid “a rate that is a fraction of the rate that similarly situated major social platforms pay”.
The label claimed “TikTok’s success as one of the world’s largest social platforms has been built in large part on the music created by our artists and songwriters … our analysis confirms that the majority of content on TikTok contains music, more than any other major social platform”.
In the 2022 financial year, the last for which full figures are available, Universal’s total revenue was just under $US11 billion, of which more than half ($US5.6 billion) came from digital streaming and subscription fees for recorded music. Digital revenues from publishing accounted for another $1 billion.
Universal has accused TikTok of failing to pay ‘fair value’ for music, despite being far more dependent on it than rival social media platforms.Credit: Reuters
Despite its “massive and growing user base, rapidly rising advertising revenue, and increasing reliance on music-based content”, licence fees paid by TikTok accounted for only about 1 per cent of Universal’s total revenue. TikTok was, the letter claimed, “trying to build a music-based business without paying fair value for the music”.
Universal also claimed the platform was not taking significant enough steps to safeguard against “the harmful effects of AI”, and was doing little to guarantee the “online safety” of its users.
TikTok earlier this month launched an “AI Song” option, with which users can generate original music, based on text prompts, to accompany their clips. Last week, it unveiled another AI tool, the “StreamVoice” system, with which it is possible to replicate virtually anyone’s voice in real time, with just a few samples.
The risk posed to established artists by the misuse of AI was demonstrated last week when a rash of simulated pornographic images of Taylor Swift began to circulate on the internet, eventually prompting X (formerly Twitter) to ban searches for the singer.
Universal is far from alone in having concerns about the rising power of, and static revenue from, TikTok. Sony and Warner have also had their tussles with the company over licensing. The last deals struck in 2020 and 2021 saw the social media platform offer a flat-rate deal for unlimited use of music.
However, Warner signed a new deal last July that delivered improved, if somewhat vague, terms.
“As part of the deal, Warner Music Group and TikTok will find new ways to harness TikTok’s revenue generation and promotional capabilities, as well as a wealth of insights,” TikTok said in a statement issued to herald the new arrangement.
“In addition, artists and songwriters will have access to new ways of working with TikTok’s vibrant brand partners, as well as to new fandom development and monetisation features, like merchandise, ticketing, and digital goods and services, among other opportunities. Further, the deal will see the joint development of additional and alternative economic models.”
One such model became evident in December, when TikTok and Ticketmaster combined forces to allow fans to buy concert tickets without leaving the platform.
In the Music Impact Report published last November, TikTok trumpeted the findings of the research it had commissioned into the relationship between the platform and the music business. “TikTok is the driving force behind music discovery in the industry,” the company claimed. “TikTok users are active, engaged and highly valuable drivers of music industry revenues … higher TikTok engagement – whether that’s likes, views or shares – corresponds with elevated streaming volumes.”
Universal’s announcement might simply be an attempt to improve not only on its prior arrangement but also on the deal Warner wrung out of ByteDance. But it could be something more significant: an acknowledgement that for all its importance as a platform for breaking new music and resurfacing old, TikTok is now to be considered more foe than friend.
TikTok’s response, in the form of a short statement, accused Universal of self-interest and a “false narrative”.
“It is sad and disappointing that Universal Music Group has put their own greed above the interests of their artists and songwriters,” the company said.
“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.”
Contact the author at kquinn@theage.com.au, follow him on Facebook at karlquinnjournalist and on Twitter @karlkwin, and read more of his work here.
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