Universal Music Group, home to massively popular artists such Taylor Swift, Justin Bieber, and Coldplay, is set to remove all of its artists' music off of TikTok after the two companies failed to reach an agreement around licensing. Universal Music Group released an open letter to artists on Tuesday night claiming TikTok was attempting to force them into an unfair agreement.
Yahoo Finance Reporter Alexandra Canal joins the Live show to discuss the latest development between these two companies and what it could mean for them moving forward.
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Editor's note: This article was written by Nicholas Jacobino
Video Transcript
- Let's talk a little bit more about Taylor Swift. But is it over now for Taylor Swift, Drake, and Justin Bieber on TikTok? Universal Music Group set to remove all of its artists music off the social media platform in the coming days. For more on this, Yahoo Finance's Reporter Alexandra Canal is here.
And Allie, when we talk about the significance of this, a lot of TikTok users are going to be pretty unhappy.
ALEXANDRA CANAL: Yeah. Right now, TikTok users can use up to 60 seconds of a song in their videos. But now on the heels of this news, artists like Taylor Swift, Drake, Ariana Grande, Adele that's no longer going to be available. Now, Universal Music Group, it's one of the top music labels in Hollywood, it failed to negotiate a new licensing contract with TikTok.
And in an open letter to artists that was released late last night, UMG said that TikTok has been bullying them, has been intimidating them into accepting a deal that is less than what they wanted, less than what they ultimately deserve, especially when it relates to a few issues, like artist compensation, along with protections on AI.
Now, TikTok said, it is quote, "sad and disappointing that UMG has put their own greed above the interests of their songwriters." They said that they've been able to negotiate contracts with other types of labels back in July. It did reach a deal with another label, Warner Music Group. But right now, it looks like the two sides are at a complete standstill. And like you said, Seana, those songs are going to be removed in the coming days, which leading up, you're just talking about the Super Bowl and football Taylor Swift. No, no Taylor Swift on TikTok, at least right now.
- What do you think the significance of the timing of this is as well with the major events that you were just mentioning, plus other red carpet events that are forthcoming too?
ALEXANDRA CANAL: Right. Look, TikTok is a huge platform. It is really big for artists. But UMG is arguing that it still accounts for less than 1% of its total revenue due to how little that they pay artists. So they are trying to take a stand. And this reminds me of what we've been really seeing in Hollywood across the board, right? We talk about the SAG-AFTRA strikes, those actors, writers really fighting on the picket lines for protection surrounding AI.
AI and music has been a very sticky, touching point in the industry. So it seems like now is the time that Hollywood is really stepping up to the man, so to speak, and trying to make sure that they are not falling behind when it comes to these negotiations.
- Yes, certainly. We will see if UMG is successful in maybe forcing some changes into these contracts with TikTok. All right, Allie, thanks so much.
