Pan-European indie label trade group IMPALA has said that it shares Universal Music’s concerns about music being undervalued by services like TikTok, calling on the social media firm to “collaborate with the independent music community to achieve fair licensing terms”. It has also called for Spotify, Deezer and Apple Music to deal with the “unintended negative consequences” of changes they recently made to their respective royalty models.
Honing in on TikTok and other social media platforms that use music, Mark Kitcatt, CEO of Everlasting Records and Chair of IMPALA’s Streaming Group, says, “There is an urgent need to secure fair revenues from these vital services. In line with this, IMPALA supports UMG’s stance on TikTok in relation to valuing music properly”.
He then pushes back at social media companies seeking to use the promotional value of their platforms to justify paying less to the music industry, stating “We reject arguments equating the use of music on TikTok to promotion. There is a huge value gap that must be addressed but, beyond that, an exciting opportunity to explore new ways of generating and sharing revenues”.
Better Noise Music CEO Dan Waite, who chairs IMPALA’s Digital Committee, adds: “TikTok is at a pivotal moment in terms of renewing their licensing deals where they can show that they value music fairly on their platform. It’s a use of music that needs to be remunerated like any other”.
While sharing Universal’s concerns, the indie community - unlike the major - is not yet embarking on an all out war with TikTok. Although, at the same time, it’s clearly felt that further public pressure is needed in order to get better deals out of the social media company as its licensing agreements come up for renewal.
For its part, TikTok responded to IMPALA’s statement by saying, “We value the relationships and the licensing agreements we have with the independent music community across Europe. TikTok has always been a licensed service and we’re proud of the successes that independent artists and businesses have found through our platform”.
In terms of the recent changes made by Spotify, Deezer and Apple, the indie community is not necessarily so aligned with Universal. Those changes were made, in part at least, in response to pressure from the mega major, and are therefore supported by Universal bosses.
The changes mean that, when the three streaming services allocate revenues to tracks each month based on consumption share, not all tracks and plays are treated equally. New rules are applied that benefit certain artists and labels, and especially superstars and majors.
Not all those changes are opposed by the indie community, though the lack of consultation by the streaming services has been criticised. In December last year, IMPALA set out a number of questions about Spotify’s changes and suggested a number of possible tweaks.
In today’s statement, IMPALA calls for “any changes in how revenue is allocated to be properly assessed by services in terms of the impact they create over the whole market, in line with IMPALA’s own proposals”. That includes the changes already made, but also any future changes too. And, as for future changes, IMPALA adds, “We call on streaming services to consult and discuss this with their independent licensing partners before the decision is made”.