Universal Music Group and TikTok have come to terms on a new licensing agreement, ending a three-month stalemate that saw the world’s biggest record label pull its vast musical catalog from the social media platform.
According to a press release announcing the deal, the deal 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.”
UMG and TikTok are “now working expeditiously to return music by artists represented by Universal Music Group and songwriters represented by Universal Music Publishing Group to TikTok in due course,” the press release adds.
Regarding AI specifically, TikTok will work with UMG to “remove unauthorized AI-generated music from the platform, as well as [develop] tools to improve artist and songwriter attribution.”
UMG initially pulled its catalog from TikTok on January 31st after the two companies failed to reach a new licensing agreement. At the time, the label cited three main sticking points: artist compensation, AI protections, and only safety protection for artists and fans.
As it pertained to compensation, UMG alleged that TikTok had proposed a royalty rate that was “a fraction of the rate that similarly situated major social platforms pay,” and noted that in 2022 TikTok had paid less in royalties ($220 million) than the fitness app Peloton ($267 million) despite having a far larger user base.
UMG and TikTok did not provide any specific details on their newly negotiated royalty rate. However, in a letter issued to employees on Thursday, UMG Chairman/CEO said, “Under the new agreement, artist and songwriter compensation will be greater than under our prior TikTok deal, and the total value UMG’s artists and songwriters garner from this partnership will be more closely aligned with other platforms in the social music category.”
Despite coming to terms with UMG, TikTok still has plenty of other headaches to deal with — most notably, its very existence. Last month, US Congress passed a bill demanding that the Chinese-owned company ByteDance sell TikTok within one year or face a permanent ban in the US. ByteDance says it has no intention to sell TikTok, and has promised to take their fight to court.
