Taylor Swift’s Label Universal Music Group Ends Licensing Deal with TikTok Amidst Compensation and AI Controversy

According to UMG's open letter to the artist and songwriter community, TikTok accounts for only about 1% of their total revenue, despite its substantial user base and advertising revenue. Similar criticisms have been raised against Spotify over the years.

Furthermore, UMG highlighted issues related to AI, expressing concern that TikTok allows the platform to be flooded with AI-generated recordings. Plus, TikTok is allegedly developing tools to encourage AI music creation on the platform, posing a threat to the royalty pool for actual human artists.

In addition to compensation and AI concerns, UMG criticized TikTok for its handling of infringing content on the platform. The music company accused TikTok of making little effort to address copyright infringements and failing to provide meaningful solutions for safety against issues of content adjacency, hate speech, bigotry, bullying, and harassment.

UMG asserted that TikTok's actions are tantamount to sponsoring the replacement of human artists by AI, undermining the value of creative content. UMG argued that TikTok's response to these concerns was initially indifferent and later escalated to intimidation when UMG proposed measures similar to those taken by other digital platforms.

UMG claimed that TikTok attempted to coerce them into accepting an unfavorable deal by selectively removing the music of certain developing artists while retaining content from globally recognized stars.

Despite these tactics, UMG emphasized its commitment to fighting for fair compensation and standing up for the creative and commercial value of music, asserting that intimidation and threats would not deter them from their responsibilities.

On the other hand, TikTok responded with its own official statement - in a particularly defensive and hostile manner, as is to be expected. On TikTok's newsroom page posted on January 30, the statement reads: "Despite Universal's false narrative and rhetoric, the fact is they have chosen to walk away from the powerful support of a platform with well over a billion users that serves as a free promotional and discovery vehicle for their talent." TikTok also added that "Clearly, Universal's self-serving actions are not in the best interests of artists, songwriters and fans." Roll eyes... This development is not the first instance of tensions between the music industry and TikTok.

In 2019, the National Music Publishers' Association (NMPA) called for a congressional investigation into TikTok for potential copyright theft. TikTok's early operations were also marked by expired deal extensions from its acquisition of Musical.ly in 2017. Other major music labels, including Warner Music Group (WMG), have faced challenges with TikTok, leading to short-term licensing deals.

The timing of this clash between UMG and TikTok could not have come at a more difficult period. Just recently, Taylor Swift, one of UMG's biggest talents, had been the victim of viral NSFW sexual imagery generated via AI that spread on social media platforms, particularly on X.com.

UMG's decision to end its licensing agreement with TikTok sheds some harsh light on the ongoing challenges and complexities in negotiating fair terms for artists and protecting creative content with the proliferation of AI exploitation. With government bodies in the U.S. and EU now in a heated race to impose regulations vs. AI use, how long will this trend continue?