A percentage breakdown of the approximately $1.6 billion in global recorded music revenue attributed to UGC and ancillary licensing sources for 2022 in Goldman Sachs’ “Music in the Air” report.
Predictably, the nuances of TikTok’s deal (or lack thereof) with Universal Music aren’t publicly available and will likely remain confidential. But that doesn’t mean we lack insight into the pact the service sought to secure with the major label. Here’s a much closer look at the standoff and its bones of contention.
On January 30th, Universal Music Group (UMG) announced the imminent end of its TikTok licensing deal. As described in an open letter, a lowball offer from the short-form app on a new agreement, along with user safety and AI content concerns, had prompted UMG to “call time out.”
The ByteDance subsidiary then fired back with a comparatively concise message, taking aim at what it described as Universal Music’s decision to leave behind an invaluable marketing resource due to “greed.”
Subsequently, no shortage of TikTokers lamented the absence of their favorite artists’ music on the app and, more pressingly, the removal of audio from videos containing the impacted works.
But are the bones of contention in this debate? The answer is complicated.
Report Table of Contents
I. Is TikTok’s Value As a Promotional Tool Enough to Justify Lower Rightsholder Payments?
II. TikTok Licensing At a Glance: What We Know About the Platform’s Rightsholder Deals
III. Graph: Universal Music and ByteDance Annual Revenue, 2019-23
IV. The Bottom Line: Can TikTok and Universal Music Put Their Dispute in the Rearview?
V. By the Dates: A Timeline of the TikTok-Universal Music Licensing Dispute and Related Developments