“We looked at this issue (of committing to work with music rights holders) very closely on YouTube and decided it was important to us… TikTok needs to do this; it is the right decision for them to evaluate.
Robert Kyncl knows all about tense clashes with the music rights industry – and how to resolve them.
He was, after all, chief commercial officer of YouTube, where he worked for 12 years until 2023, when he became chief executive of Warner Music Group (WMG).
Via the quote above, delivered during a WMG earnings call in February, Kyncl gave a nod to YouTube’s reputation as a major record company’s pet peeve…and how the video service owned by Alphabet has finally improved its reputation with (and, coincidentally, the amount it pays) the recording industry.
Today (July 18), Kyncl, alongside TikTok CEO Shou Zi Chew, made a major joint announcement that hints at a new day for the relationship between major music companies and the ByteDance-owned app: a new multi-year licensing agreement between WMG and TikTok that the two parties are calling a “first of its kind” pact.
What does that mean?
In a joint press release, TikTok and Warner clarify that the new “multi-year, multi-product” deal will see WMG license Warner Recorded Music and Warner Chappell Music’s repertoire to TikTok and TikTok Music, as well as the ByteDance-owned video editing platform. CapCut, as well as TikTok’s commercial music library.
(It’s the commercial music library that allows brands to almost instantly license music for ad syncs on TikTok, which TikTok’s global music boss Ole Obermann says could ultimately multiply the size of the global music synchronization market.)
The PR goes on to say that the new agreement will allow “WMG and TikTok (to) find new ways to leverage TikTok’s revenue-generating and promotional capabilities,” as well as facilitate “new development and monetization features. of fandom, such as merchandise, ticketing, and digital goods and services, among other opportunities.”
“We are very excited to partner with Warner Music Group to create a shared vision for the future in which artists, songwriters, music fans and the industry can all benefit from the power of discovery on TikTok platforms.”
Shou Chew, TikTok
Perhaps the most intriguing line from the press release jointly issued by WMG and TikTok today?
“(The) agreement will see the joint development of additional and alternative business models.”
Which could This mean? There are a few possibilities.
Did Robert Kyncl (and his WMG team) negotiate a more sophisticated payment structure for TikTok licenses than the flat rate/global licensing deals we’ve seen Warner and other majors agree to in the past?
Or could these “additional and alternative business models” have more to do with TikTok Music – the brand new music subscription app that TikTok has just launched in Indonesia and Brazil (effectively replacing Resso)?
That’s for further discussion another day.
For now, the facts: Following a recent rather tumultuous behind-the-scenes relationship between major music companies and TikTok (including This Australian experience), TikTok and the world’s third-largest music company are – now at least – close friends again.
Robert Kyncl, CEO of WMG, said, “We are happy and excited for our next chapter with TikTok.
“Through this expanded and significantly enhanced partnership for both companies, we can jointly deliver greater value to WMG artists and songwriters and TikTok users.”
Shou Chew, CEO of TikTok, said, “We are very excited to partner with Warner Music Group to create a shared vision for the future in which artists, songwriters, music fans and the industry can all benefit from the power of discovery on TikTok. platforms”.
The music industry around the world