Universal Music Group (UMG) and TikTok have buried the hatchet, reaching a new licensing agreement that will restore the label’s artists to the social media platform.
The deal ends a months-long standoff that saw UMG’s songs pulled from TikTok in January over disputes involving royalty payments, AI protections, and online safety.
For the music industry, TikTok’s short videos are a potent promotional tool, especially among Gen Z. “Roughly a quarter of U.S. consumers say they listen to songs they have heard on TikTok,” noted Tatiana Cirisano of Midia Research. However, UMG claimed its artists received just a fraction of what other platforms like YouTube pay, with TikTok accounting for only 1% of UMG’s 2023 revenue at $110 million.
The AI challenge proved a key sticking point, with UMG opposing royalties for AI-generated songs amid concerns over undermining human creativity. However, with TikTok’s U.S. future uncertain due to a forced sale, both sides likely had an incentive to compromise. Financial terms were not disclosed.
TikTok has over 170 million U.S. users but has vowed to legally challenge the divestment order by the U.S. government.
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