Universal Music Group (UMG) may be pulling its music from TikTok.
In an open letter, UMG listed several grievances that may cause the music company to severe its partnership with the rapidly growing platform. It credits some of TikTok’s success and global reach to the music that has been created by UMG artists and songwriters. Despite this, the company highlights the inadequate compensation for its artists and songwriters, with the platform contributing only a minuscule amount to UMG’s total revenue.
“With respect to the issue of artist and songwriter compensation, TikTok proposed paying our artists and songwriters at a rate that is a fraction of the rate that similarly situated major social platforms pay,” UMG said in a letter. “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.”
UMG also cited ethical concerns around artificial intelligence (AI), revealing the platform is permitting the use of various AI-generated records as well as supporting its users through tools designed to promote AI music creation. The company believes the interactions with AI-generated music will “massively dilute the royalty pool for human artists.”
UMG claims executives have been in conversation with TikTok to negotiate a new deal. However it states TikTok is attempting to persuade the company, even employing intimidation tactics, to enter into an agreement valued at less than their previous deal.
UMG’s contract will expire on Jan. 31, 2024.
“TikTok attempted to bully us into accepting a deal worth less than the previous deal, far less than fair market value and not reflective of their exponential growth,” UMG penned. “How did it 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.”
TikTok has shared a statement in response to Universal Music Group’s claims.
“It is sad and disappointing that Universal Music Group has put their own greed above the interests of their artists and songwriters,” TikTok said, according to Variety. “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.”