Written by Shadnay Ngari
Universal Music Group (UMG) is the world’s leading music company with some of the UK’s biggest artists such as Harry Styles, Adele and Coldplay at the forefront of its roster. Home to a vast array of record labels such as Virgin Music, Capitol Music group and more globally, Universal Music maintains its position as a giant in the music industry. The benefits of being able to produce music under a record label and parent group with such great influence and connections is endless, however recent shifts in the market have resulted in many artists subject to underexposure.
With an increase in streaming platforms and technological advancements over the years, there has been a significant change to how artists release and market music to their fans and listeners worldwide. One of the most accessible and popular ways that people currently listen to music is through the widely popular social media app, TikTok which is available in over 160 countries and has over 1.1 billion users. Where music was once a tangible exchange of selling CDs and Vinyl, this has now evolved into a swift and easily accessible experience available at the touch of one’s fingertips. Users on the TikTok platform have the ability to listen to thousands of different songs by scrolling through short clips, curated to their preferences through the TikTok algorithm. Unsurprisingly, this has proven to be an excellent way for artists to have their songs benefit from the exposure of a wide audience whilst gaining financially through royalties that are accumulated as part of the process. In this context, royalties relate to TikTok obtaining permission from UMG to use their music. Under the terms of such licence, UMG licenses its music catalogue to TikTok which makes the music available on the platform for the duration of an agreed term or licensing period. With music being at the heart of TikTok, this should allow streaming of music on a non-exclusive basis to be mutually beneficial for both companies.
Unfortunately, a breakdown in negotiations to renew the licensing agreement between Universal and TikTok has resulted in the removal of UMG owned music on the platform. This has extended to now include the label’s publishing catalogue. In an open letter on their website, Universal Music has cited ‘appropriate compensation for our artists and songwriters’ in addition to the ‘harmful effects of AI and online safety for TikTok users’ as critical issues to be addressed in the renewal of any ongoing licence agreements with TikTok. These elements may have been lacking in the previous agreement and it would appear that during negotiations for this contract renewal, the two parties have been unable to arrive at a consensus on clear and fair payment methods for artists or stricter regulation concerning the use of voice synthesis on the platform.
Licence agreements between record labels and platforms utilising music owned by Copyright owners should provide clear guidance on how artists will be fairly compensated, based on streams or views and specify when payments will occur. It would also be sensible to have a start and end point, in this instance the agreement started in February 2021 and ended on 31st January 2024. With the rapid change of social media, it is sensible to review the terms of the agreement on a frequent basis so that they can be re-negotiated considering any changes – such as in this instance.
As a result of the contract’s expiration and the recent removal of music controlled by Universal Music Publishing Group (UMPG), millions of songs by UMG artists have been muted on TikTok, causing a decline in exposure and financial gains for many artists.
The end of the licensing agreement has highlighted some real advantages to being an independent artist, as they are better placed to benefit from keeping all the profits as well as maintaining full creative control and ownership of your music, which would allow artists to have the freedom to negotiate music licensing with platforms. This was briefly highlighted in Channel 4’s UNTOLD when Krept (Krept & Konan) highlighted the significance of being an independent artist in a new era after being signed to Virgin for almost a decade, “It is so important to us to have 100% ownership of our music, this is how it should be done.”
Nevertheless, record labels such as UMG are in unique positions that enable them to negotiate deals for artists due to their positioning and leverage in the market. Whereas independent artists may encounter difficulties if platforms such as TikTok haven’t extended the scope to have negotiations with the millions of independent artists worldwide.
AI remains consistent within music industry and continues to challenge existing legal frameworks when it comes to ownership and copyright protection. There are concerns that AI will saturate music streaming by generating voice synthesised songs, as well as making human artists and producers redundant. FN Meca is a controversial AI-powered rapper who amassed over ten million followers on TikTok. It was the first AI artist to be signed by a major record label (UMG) in 2022, demonstrating AI’s capabilities in saturating the industry.
Ironically, as outlined in UMG’s open letter publication, one of the focal points for discussion during the license renegotiation was ‘protecting human artists from the harmful effects of AI’. Whilst this is a legitimate concern, it could be argued that they were a trailblazer in the integration of AI within the music industry by signing an AI artist to their international record label.
However, as music production is often a collaborative process, the trajectory indicates that AI will become a useful tool to accelerate the music-making process rather than a complete replacement.
We may be witnessing a shift from artists aspiring to build their music careers with recording labels to a preference where others opt for the independent route to achieve success. Conversely, without implementing measures to create a more equitable environment coupled with exposure for artists and musicians, or a move towards development in legislation to protect the rights of artists in the music industry, this shift may not fully materialise.
Beyond the scope of music, the Royal assent of The Online Safety Act 2023 will put social media platforms such as TikTok under more scrutiny and regulation to adhere to stricter guidelines, changing online safety dramatically.
- You can read more about it here