TikTok has secured a licensing deal with the world’s leading music publishers Universal Music Group, Warner Music Group, and Sony Music.
The app which lets users shoot 15-second videos and then select music from a library of songs, pays royalty to artists for using their tunes.
However, to do so, licensing agreements are necessary which the app still had in place from predecessor Musical.ly that the company bought in 2017 for $800 million. These agreements were running out late last year putting TikTok’s music library in jeopardy.
The deal is being touted as one of the company’s largest licensing agreements to date.
The three major labels are granting the app access to their libraries for a limited period of time. It’s not exactly clear how long the agreement is for, but Billboard reported that it was less than the traditional 18-month periods.
It appears the music labels are waiting for the Bytedance app to figure out how it’s going to monetise before committing to a long-term partnership.
The app appears to be struggling to find a way to generate incomes for its creators and it hasn’t rolled out any extensive monetisation tools for marketers either.
There are also concerns that TikTok may be ruining the music industry as we know it because teenagers are becoming used to listening to just 15 seconds of a song.