Universal Pulls Its Music Catalog from TikTok Amid Claims of Artist Exploitation

Social media app TikTok is currently entangled in a tussle with entertainment giant Universal over the compensation of artists whose songs are used in dancing videos.

Universal has a massive presence in the music industry, and it withdrew its catalog from TikTok after failing to reach a consensus with TikTok over a new licensing contract. Universal is home to sensations like Taylor Swift and rapper Bad Bunny.

TikTok is currently under fire over its compensation policy for artists whose audios are used on the platform.

During the Grammy Awards that happened last week, the social media platform came under fire. Host Trevor Noah criticized the social media platform for ripping off artists." The comedian joked that TikTok was copying Spotify in failing to compensate artists.

Universal's Open Letter to TikTok

Earlier on, Universal penned an open letter to TikTok accusing the popular short-video app of failing to compensate artists for the songs used as backing tracks on clips.

Universal said that the success of TikTok was largely attributed to the music created by artists and songwriters on Universal. Universal went ahead and quoted TikTok executives who said music was at the heart of the platform's experience. The majority of content posted in TikTok contains music.

Universal said that the previous contract with TikTok expired on January 31, 2024. The company was now seeking fresh terms for a new contract including fair compensation for artists and songwriters.

The rate at which TikTok was compensating artists under the expired contract is unclear. However, Universal says TikTok accounts for below 1% of its $11 billion revenue.

While negotiating the new contract, Universal said TikTok offered to pay just a fraction of the rate offered by other social media platforms.

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," Universal said. Ultimately TikTok is trying to build a music-based business, without paying fair value for the music."

Universal Music Group is pulling its music from TikTok.

UMG says TikTok accounts for just 1% of revenue. pic.twitter.com/HlwxdQ26Tr

- Dan Runcie (@RuncieDan) January 31, 2024

Issue with AI Use on TikTok

Universal has also pointed out issues with the use of AI on TikTok. TikTok has supported AI-generated tunes on its platform, which according to Universal, poses a danger to the income earned by singers and bands writing original tracks.

Universal Music Group called out Tiktok for trying to underpay artists & profit off the use of AI by promoting its use & not adequately protecting artist IP. UMG taking the bold step of protecting the intellectual properties of their artists is commendable. AI must be regulated!

- OLAMIDE (@Olamide0fficial) January 31, 2024

Universal claimed that TikTok allowed AI-generated recordings on its platforms as well as tools that support and promote AI music creation. While doing this, TikTok also demanded a contract permitting such content to dilute the authenticity of human artists.

Another complaint revolves around TikTok making little effort to address the content infringing on artists Universal said that TikTok has not addressed issues affecting the type of content offered on the platform such as bigotry, hate speech, bullying, and harassment. The processes used to remove harmful content on TikTok are also hectic and inefficient.

TikTok and Universal Might Be Forced To Reunite

There are speculations that TikTok and Universal might be forced to reconcile for the benefit of the two companies.

Music from Universal Music Group is no longer available for use in TikTok videos and has been removed from existing videos.

An interesting question is if this becomes a Netflix moment" for TikTok where they start producing their own artists or if like Spotify they will relent? pic.twitter.com/GyopyOFzd4

- Dare Obasanjo (@Carnage4Life) February 4, 2024

A few musicians have a vast following on Universal. Such musicians will no longer have a platform where they can reach wider audiences. TikTok has a vast global reach, and having music on the platform will help artists sell their creations.

By ditching TikTok, Universal will also lack a way of getting additional funds from older hits. TikTok acts as a good promotional tool for artists as songs popular on the platform have a listening elsewhere.

On the other hand, TikTok is facing stiff competition from rival platforms such as Instagram Reels. Therefore, it might be forced to renegotiate the deal with Universal to bring back its catalog.

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