TikTok Establishes New Licensing Agreement With Universal Music

Finally, some good news for TikTok.

Amid EU investigations, and the forced sell-off in the U.S., TikTok has announced that it’s come to terms with Universal Music Group (U.M.G.) on a new multi-dimensional licensing agreement.

As per TikTok:

“The joint agreement marks a new era of strategic collaboration between the two organizations, built on a shared commitment to help U.M.G.’s artists and songwriters achieve their creative and commercial potential. By harnessing TikTok’s best-in-class technology, marketing and promotional capabilities, U.M.G. and TikTok will deliver improved remuneration for U.M.G.’s songwriters and artists, new promotional and engagement opportunities for their recordings and songs and industry-leading protections with respect to generative A.I.”

Universal pulled its music from TikTok back in February, after negotiations on a new music licensing arrangement reached an impasse. According to U.M.G., TikTok had offered it far less of a share than its previous licensing arrangement, while TikTok maintained that its value to U.M.G. was more significant than the publisher would acknowledge.

The end result was that music from U.M.G. artists, including Taylor Swift, Adele, Drake, and Billie Eilish, disappeared from the app, while previously uploaded clips with U.M.G. music also fell silent.

But now, the two sides have been able to establish a new agreement, which will see Universal return once again, providing more opportunities for artist promotion, and more creative potential for TikTok creators.

And really, it’s a win-win for both sides, even without knowing the full specifics of the deal, due to the value that TikTok now provides for music promotion.

Indeed, a TikTok commissioned report published last November showed that TikTok users are significantly more likely to both discover and share new music content in the app, while 75% of its users also find new artists via TikTok clips.

As such, TikTok’s right to value its platform so highly for publisher collaborations, but at the same time, that value only exists because TikTok is able to provide connection to these artists. So each, really, needs the other equally.

TikTok says that it will now work with U.M.G. on new monetization opportunities by “utilizing TikTok’s growing e-commerce capabilities.” TikTok also recently established a new in-stream ticket sales process, in partnership with Ticketmaster (and CTS EVENTIM in Europe), while it’s still developing its in-app shopping push, which it hopes to build into a key revenue stream.

Presumably, these new opportunities will involve tickets, and merch sales, and it’ll be interesting to see how TikTok can integrate more opportunities for musicians via this route.

But the main point of note is that U.M.G. tracks are back, re-filling a significant hole in TikTok’s soundtrack database.