"UMG is kind of taking the nuclear option of removing all their music and trying to prove ... that TikTok couldn't exist if it didn't have their catalog," says Tatiana Cirisano, a music industry analyst at Midia Research.
"With respect to the issue of artist and songwriter compensation, TikTok proposed paying our artists and songwriters at a rate that is a fraction of the rate that similarly situated major social platforms pay. Today, as an indication of how little TikTok compensates artists and songwriters, despite its massive and growing user base, rapidly rising advertising revenue and increasing reliance on music-based content, TikTok accounts for only about 1% of our total revenue. Ultimately TikTok is trying to build a music-based business, without paying fair value for the music," states UMG in their open letter.
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