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Where Did The Music Go?

By Lydia Kautsky · Mon, Feb 26, 2024 5:00 PM

On January 30, 2024, Universal Music Group (“UMG”) announced that it failed to reach an agreement to license UMG’s music catalog to TikTok and its users for distribution on the social media platform.1 UMG sites TikTok’s refusal to address appropriate compensation for artists and songwriters, protection of human artists from the harmful effects of AI, and improving online safety for TikTok’s users as the primary reasons for negotiations breaking down.

UMG owns record labels that release music from massive artists such as Taylor Swift, Drake, U2, Billie Eilish, and Ariana Grande. When a musical artist signs a contract with a record label, the artist typically either grants the record label (i) ownership over the sound recordings that are created by the artist while under contract with the record label or (ii) control over the distribution of the sound recordings that are created by the artist while under contract with the record label. As a result, without an appropriate music license agreement between UMG and TikTok, creators will not be able to feature popular music within UMG’s catalog in their content published on TikTok.2

The legal rights to music are protected by copyright law. Each music track consists of two independent copyrightable works: (1) the composition of the music and (2) the performance of the music. The composition refers to the written notes and lyrics that create a musical work. The performance of the music refers to an artist’s actual, specific performance of the music, often in the form of a sound recording.

For a third-party to use a musical track in a commercial manner, it needs a license for both the underlying composition and the particular sound recording it desires to use. To complicate matters further, there are different types of licenses required for different uses of a composition or a sound recording.

There are three primary types of licenses for musical compositions:3

  • A Mechanical License allows the license holder to create a sound recording of the musical composition and distribute said sound recording;

  • A Synchronization License allows the license holder to use the composition in a music video, television program, movie, video game, advertisement, mobile app, or other audiovisual work; and

  • A Public Performance License allows the license holder to publicly perform the composition in a live performance or public broadcast (such as radio or digital streaming platforms).

There are two primary types of licenses for sound recordings:4

  • A Master Use License allows the license holder to use the particular sound recording in a soundtrack, television program, movie, advertisement, video game, or other recorded work. Depending on the use, this license will typically need to be paired with either a mechanical or synchronization license of the underlying composition;

  • A Digital Public Performance License allows the license holder to use the sound recording in radio or interactive audio-only streaming, depending on the terms of the license. Depending on the use, this license will typically need to be paired with either a mechanical or public performance license of the underlying composition.

Adding further complexity to music licensing, the rights to a single musical work are often held by a variety of different parties. The song writer(s) typically5 hold the copyright for the composition, but sometimes performing rights organizations6 purchase these rights. For a particular sound recording, the record label usually holds the rights to license the musical work to a third-party (as noted above, this right is typically acquired as part of the contract between the record label and the recording artist). Because different parties hold different rights to a single musical track, obtaining the necessary rights to use, distribute, and otherwise commercialize music is a complex process.

In this particular case, UMG is a music entertainment company that owns many record labels around the world. TikTok cannot use music for free – like any other social media platform, it needs to obtain the necessary licenses to allow its users to create content featuring particular music. TikTok needs to acquire a Digital Public Performance license from UMG to distribute UMG-owned music on its platform. The two parties were unable to reach an agreement for TikTok to continue licensing musical works under UMG ownership. By not granting such a license, UMG is wiping its catalog from TikTok; new content on the platform cannot be created using any sound recordings owned by UMG, and previous content featuring UMG-owned sound recordings now appear silent.7

As a result of past content being removed, and future content being limited, creators might emphasize content on alternative platforms (such as Instagram) where UMG’s music can still be utilized. Additionally, UMG’s artists will almost certainly experience fewer viral songs, as TikTok is a primary contributor to viral music culture. Will UMG’s music return to TikTok? That remains to be seen. The parties need to work out the legal complexities surrounding music licensing and reach an agreement on fair compensation, AI restrictions, and user safety before TikTok users can expect to once again be able to create content featuring works from UMG’s music library.

  • 1.

  • 3.

    Weiss, Lisa, Music Licensing, Westlaw Practical Law Practice Note 6-584-9909; Practical Law Intellectual Property & Technology, Music Licensing Chart, Westlaw Practical Law Checklist w-015-7676

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  • 5.

    There are often multiple individuals writing on a single song, resulting in the copyright vesting in more than one person.

  • 6.

    Performing Rights Organizations (“PROs”) act as intermediaries between music copyright holders and individuals who want to utilize music for commercial purposes. PROs specifically assist copyright holders with collecting royalties in exchange for permitting the public performance of their music. The major PROs are ASCAP, BMI, and SESAC.

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