TikTok is strategically positioning its dedicated music service, TikTok Music, as a competitor to platforms like Spotify and Apple Music. The platform is also experimenting with an "AI Song" feature, which uses AI to generate songs. Despite ongoing talks with Warner Music Group, Sony Music Entertainment, and UMG for a share of ad revenues, TikTok has not hesitated to assert its influence strategically, including pursuing exclusive distribution deals with musicians for ByteDance's SoundOn service.
Key takeaways:
- Universal Music Group (UMG) is planning to withdraw its song catalog from TikTok following unsuccessful negotiations with ByteDance, TikTok's parent company, over royalty agreements.
- UMG accuses TikTok of trying to build a music-based business without paying fair value for artists' music, contributing only about 1% to the label's total revenue despite its large user base and ad revenue.
- The disagreement also involves payments for AI-generated recordings using UMG properties and TikTok's alleged slow response in removing content that violates UMG's copyright.
- TikTok is strategically positioning TikTok Music as a competitor to platforms like Spotify and Apple Music, and is also experimenting with an 'AI Song' feature that uses AI to generate songs.