May 2, 2024 3 min read

Universal and TikTok are best buds again

Universal Music has agreed a new licensing deal with TikTok, ending a three month standoff that saw the major’s music removed from the social media platform. Universal says its new deal properly values music, while providing reassurances about TikTok’s ambitions in AI

Universal and TikTok are best buds again

All good things must come to an end. Bad news today for fans of the great Universal v TikTok bust up of 2024. It’s over. They’re besties again and there’ll be no more TikTok tantrums in Universal Music HQ. 

Gone is the era of stalled marketing campaigns, muted videos, TikTok creators using sneaky covers, and Taylor Swift being a bona fide rule breaker. Shou has finally picked up the phone to Lucian - Lucian’s phone is always open, remember - or maybe Lucian called Shou. But who’s counting when a deal has been done? Cristal for everyone!

“This new chapter in our relationship with TikTok focuses on the value of music, the primacy of human artistry and the welfare of the creative community”, says Universal boss Lucian Grainge

I guess that more or less covers the three key issues Universal raised when it announced that licensing negotiations with TikTok had stalled back in January: money, AI and platform safety. “Valuing music” means paying more money; the “primacy of human artistry” means reassurances about TikTok’s ambitions in AI-generated music; and the “welfare of the creative community” means addressing the issues that have been raised about content moderation.

An official statement about the new deal declares, “By harnessing TikTok’s best-in-class technology, marketing and promotional capabilities, UMG and TikTok will deliver improved remuneration for UMG’s songwriters and artists, new promotional and engagement opportunities for their recordings and songs and industry-leading protections with respect to generative AI”.

“Valuing music” almost certainly means TikTok paying Universal a massive stack of cash. While the dispute was going on, sources indicated that Universal wanted another “two to three hundred million” from its new deal - on top of the €111 million it made from use of its music on the platform in 2023. However, the social media company has also seemingly capitalised on the renewed obsession with super-serving superfans at the major record companies

“As part of the agreement”, the official statement adds, “both organisations will work together to realise new monetisation opportunities utilising TikTok’s growing e-commerce capabilities”.

It’s also thought that TikTok has been heavily pushing marketing kickbacks in its negotiations with the majors, offering access to networks of influencers, the ability to inform the algorithm, and lots of free advertising space on the platform. 

To what extent those kickbacks sweetened the deal for Universal we don’t know, though the official statement continues, “TikTok will continue to invest significant resources into building artist-centric tools that will help UMG artists realise their potential on the growing platform”.

Welcoming the new deal on the TikTok side, CEO Shou Chew took a few minutes off from fighting the US TikTok ban to declare, “Music is an integral part of the TikTok ecosystem and we are pleased to have found a path forward with Universal Music. We are committed to working together to drive value, discovery and promotion for all of UMG’s amazing artists and songwriters, and deepen their ability to grow, connect and engage with the TikTok community”.

When the major’s previous licensing deal expired at the end of January, with no new one to replace it, TikTok had to pull all of Universal’s recordings off its platform. A month later, songs published and licensed by Universal were also blocked, meaning the bust up started impacting other labels too, if any of their tracks featured songs covered by Universal’s songs licence.

While it’s not just Universal bosses who reckon that TikTok has generally under-paid for the music on its platform, the sudden pulling of the major’s catalogues was frustrating for affected artists. Especially those for whom TikTok is a key fan engagement tool, not to mention artists with new music to promote. Unless, of course, your name is Taylor Swift who, despite being distributed and published by Universal, made sure her music was back on TikTok as the marketing campaign for new album ‘The Tortured Poets Department’ got underway.

The affected artists will presumably be pleased that their music is back on TikTok, although maybe less so if they’ve already invested lots of time devising marketing campaigns with workarounds that accommodated the big boycott. Meanwhile, given all the mysteries that surrounded the original TikTok licensing deals - and the new complexities seemingly added to this new one - artists can only guess how they will benefit from all the new “value” the bosses at Universal have factored into the deal. 

Even if they do figure it out, this may all be ultimately meaningless if TikTok ends up being banned in the US. Or even the EU. But for the moment at least you can knock yourself out watching endless video clips with your favourite Universal-controlled tracks in them.

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