TikTok’s estimated 1.5 billion monthly users can enhance their videos with music from across the main record label catalogues, making it an important part of the modern music ecosystem. But UMG said in a statement early Wednesday that it would pull its tracks because of a lack of compensation for artists and songwriters.
“TikTok proposed paying our artists and songwriters at a rate that is a fraction of the rate that similarly situated major social platforms pay,” UMG said.
TikTok, owned by the Chinese company Bytedance, responded early Wednesday with its own scathing response, accusing the music company of putting “their own greed above the interests of artists and songwriters.”
UMG said TikTok only accounts for 1% of its advertising revenue — despite its artists representing 8 out of 10 of the most popular bands and singers on the platform last year. Around 60% of TikTok videos include music.
The Dutch-American-owned UMG, which has no relationship to NBC Universal, the parent company of NBC News, is one of the so-called “Big Three” global music companies. Its licensed artists include The Beatles, Elton John, Bob Dylan, U2, Ariana Grande, SZA, Billie Eilish, Adele, Coldplay and many more.
In an open letter to its artists titled “Why We Must Call Time Out on TikTok,” UMG said: “Ultimately TikTok is trying to build a music-based business, without paying fair value for the music.”
UMG added that it was concerned about the growth of artificial intelligence tools used in TikTok videos and their effect on intellectual property, while also complaining about the amount of content that commits copyright infringement, as well as “a tidal wave of hate speech, bigotry, bullying and harassment.”
“As our negotiations continued, TikTok attempted to bully us into accepting a deal worth less than the previous deal, far less than fair market value and not reflective of their exponential growth,” it said.
UMG also alleges that TikTok attempted to intimidate it by “selectively removing the music of certain of our developing artists,” while keeping “audience-driving global stars.”
TikTok has not specifically responded to this or UMG’s other accusations, but accused the company of “false narrative and rhetoric” and pointed out it was able to sign deals with other major music labels.
The company signed a music licensing deal with Warner Music Group last year.
“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 said.