UMG plans to stop licensing content to TikTok after their deal expires on January 31, saying they didn't reach terms over issues like artist compensation and AI

UMG said that its agreement with TikTok is set to expire on Jan. 31. “The companies have not agreed to terms for a new agreement …

Variety 2024-01-31 Todd Spangler

Context & Ripple Effects

This is a break from the global UMG-TikTok agreement announced in 2021, after negotiations involving UMG, Sony and Warner had already focused on ad-revenue sharing and higher royalties. It turns a recurring debate over platform music economics into an immediate licensing deadline.

The dispute also puts AI safeguards alongside compensation in a major music-platform negotiation. The ensuing removal of UMG recordings from TikTok and later expansion to publishing rights show how a contract impasse can quickly alter the platform's usable music catalog.

First-order effects

UMG artists and songwriters face the loss of authorized TikTok use for their recordings and compositions if no replacement agreement is reached; TikTok users and creators lose access to affected music.
TikTok must operate with a diminished UMG catalog and manage muted or replaced soundtracks as rights lapse, as reflected in the subsequent catalog pullback.

Second-order effects

The standoff gives other major music rightsholders a concrete negotiating reference point as they seek better royalty terms and a share of platform advertising revenue.
Creators, marketers, and music distributors must shift toward tracks still cleared for TikTok, making licensing status more consequential for song discovery and campaign planning.

Third-order effects

If large catalogs repeatedly withhold music to secure terms, short-form platforms may need licensing models that more directly tie music compensation to advertising and creator-driven use.
AI protections are becoming a core commercial-rights issue rather than a separate policy concern, pushing music licenses toward more explicit rules on training, imitation, and unauthorized synthetic uses.

The trend: Music labels are using the leverage of indispensable catalogs to renegotiate the economics and AI rules of short-form video distribution.

Discussion

UPROXX UPROXX on x
Are Taylor Swift's Songs Leaving TikTok?
@jbonamassa Joe Bonamassa on x
“Ultimately TikTok is trying to build a music-based business, without paying fair value for the music.” Now do Spotify and Apple. Fair value in terms of compensation for songwriters and artists is so far in the rear view mirror that Napster seems like just glitch in the matrix.
@o_biennis @o_biennis on x
it looks like TikTok is allowing AI generators to take money from the royalty pool so that every time you play a song of your fav that is AI generated you're basically taking money from them and sending it to the person who created the AI version. https://www.universalmusic.com/ …
@russdiemon @russdiemon on x
A label stomping its feet because it's not getting paid enough for the music they own is top notch comedy
@renkiger_ @renkiger_ on x
👀🧐 UMG very right to walk from the deal proposed by TikTok (and pull music off). The terms re rate of pay to artists less than other platforms, plus the AI terms devaluing artists' share further, AND the bits abt TT targeting vulnerable artists...UGH https://www.universalmusic.co…
@umg @umg on x
Our core mission is simple: to help our artists & songwriters attain their greatest creative and commercial potential, which is why we must call time out on TikTok. Learn More: https://www.universalmusic.com/ ... [image]
@mikeisaac Rat King on x
comments below this post are fascinating to me — Spotify gets regularly raked over the coals for its royalties for artists but when hammering tiktok for similar moves....quite a different response (not that labels are unilaterally honest brokers in this dynamic...)
@broderick Ryan Broderick on x
TikTok's biggest impact is not just on music, but the actually unprecedented open flow of audio file sharing. We've honestly never had a platform be this big and allow this much remixable audio. It would have been unthinkable even 10 years ago. Without that, everything changes.
@mikeisaac Rat King on x
this stuck out to me: tiktok trying to dilute the royalty pool when AI generated music is used —re-opens the entire model training debate and intellectual property etc etc [image]
@annaknicolaou Anna Nicolaou on x
full story: Universal Music accuses TikTok of “bullying” & says TikTok offered a “fraction” of the rate that other social media sites pay for access to its catalogue. (FT recently reported that Bytedance had $50bn in cash on hand last year) https://www.ft.com/...
@xpangler Todd Spangler on x
Universal Music Group said TikTok tried to “bully” UMG into a deal worth less than its previous pact. As such, Universal Music said it will no longer license content to the app https://variety.com/... via @variety
@broderick Ryan Broderick on x
This could honestly snowball into something that fundamentally alters the way the internet (and culture) currently works.
@jamesrbuk James Ball on x
My hunch is it's in everyone's interest to get a deal and so one will be found. But maybe with a week or two of drama along the way.
@tiktokcomms @tiktokcomms on x
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@carolineonline_ Caroline Butler on x
A bit of a puff piece for Lucien Grainge but an absolutely fascinating read on a fearless approach to AI in music and how necessary controlled experimentation is. https://www.newyorker.com/...
@drorpoleg Dror Poleg on x
“A decade ago... major labels were responsible for about ninety per cent of the content on streaming platforms; today, their share is roughly ten per cent.” 😮 @jmseabrook's exploration of AI vs. music: https://www.newyorker.com/...

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