Outside The Box - Battle of Giants

Published about 2 months ago • 1 min read

Hey, Reader, it's Jerome -

UMG pulled its catalog off of TikTok

It’s an unprecedented move in the industry that has been making noise for a few weeks, especially now with other labels joining UMG's action.

So, what’s wrong?

It’s quite a battle, with both sides accusing each other of being greedy.

UMG accuses TikTok of:

  • Not providing appropriate compensation
  • Failing to protect artists from the AI-generated music surge
  • Lacking online safety for users

ByteDance (TikTok's parent company) counters by saying:

  • UMG is prioritizing its greed above the interests of its artists
  • UMG is abandoning a “powerful” platform that supports its artists

This situation aligns oddly with UMG’s Artist Centric Approach unveiled last year, advocating for better payments, authenticity, and strengthening the bond between artists and their fans.

UMG has pushed platforms like YouTube for better remuneration and secured favorable deals with Facebook Meta and Spotify. Now, they expect TikTok to follow.

But what if TikTok doesn’t comply?

UMG’s next step is simple:

Take down every song that has a writer or creatives under UMG contracts — their full publishing catalog.

This includes artists like Adele, Harry Styles, etc.

Anyone who has Publishing through UMG.

To clarify, if a UMG writer contributed just 1% of the songwriting to a recording, it would have to come off TikTok.

That would be the end of most popular hits and songs on the platform!

Some UMG artists have loudly expressed their disagreement with these choices.

But who’s right in this fight?

For TikTok:

  • A huge market gap
  • Millions of videos gone
  • Unhappy users

For UMG:

  • A significant audience and marketing gap for their artists
  • A 1% income cut
  • Unhappy artists

What does this mean for other artists?

There’s a 7 million song gap on TikTok right now, creating more space and possibility for discovery.

It probably won’t stay like this for too long, as UMG & TikTok will likely come to terms soon.

But is this all fluff?

Let’s look at the numbers for a moment.

We know that:

  • UMG has about a 32% market share of the music industry.
  • TikTok paid $110M to UMG in 2023.

From there, we can deduce that TikTok paid around $400M in royalties last year.

Quite high, huh?

Let’s consider one more number:

TikTok’s 2023 projected profit is $18B.

Now, for a platform that relies heavily on music, does that seem fair?Anyway,

Anyway, you know where to find me.

Best,
Jerome

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