If you felt like there was a considerable lack of Taylor Swift blasting through your TikTok this morning you would be correct. After failing to reach a deal with the platform’s parent company, ByteDance, over royalties, Universal Music Group (UMG) has pulled its music from the platform.
UMG has accused TikTok of building a “music-based business without paying fair value for music” and will not renew its contract with TikTok that expired on January 31st 2024.
“TikTok proposed paying our artists and songwriters at a rate that is a fraction of the rate that similarly situated major social platforms pay,” the label said. “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”.
Some of the most famous and commercially successful artists of all time are represented by UMG including Taylor Swift, Elton John, U2, Drake, Coldplay and Bob Dylan. It is also important to note that a large number of UMG’s artists owe their success to the social platform.
“It is sad and disappointing that Universal Music Group has put their own greed above the interests of their artists,” TikTok responded. “Despite Universal’s false narrative and rhetoric, the fact is they have chosen to walk away”.
In the 2022 financial year UMG total revenue was just under $US11 billion, licence fees paid by TikTok accounted for only about 1 per cent of the music giants total revenue.
TikTok acknowledged that in the interim, it would be the fans who experience the immediate effects of the deal ending. “We have an overriding responsibility to our artists to fight for a new agreement under which they are appropriately compensated for their work,” UMG said.
