Universal Music Group (UMG) has announced that it will stop licensing its music library to TikTok after the two companies failed to reach an agreement over several issues, including artist payments and AI-generated content.

This means that music from some of the world’s biggest artists could be removed from the platform. UMG’s existing licensing deal with TikTok is set to expire, and the label has stated that it pressed TikTok on three issues during contract renewal discussions: compensation for artists, protecting human artists from the harmful effects of AI, and online safety for TikTok’s users.

UMG has alleged that TikTok proposed payouts for artists and songwriters at a rate that is a fraction of the rate that similarly situated major social platforms pay. The loss of access to UMG’s content library is likely a major setback for TikTok, as one of its key features is allowing users to easily add licensed music to their videos.

UMG’s decision will impact artists such as Taylor Swift, Bad Bunny, Drake, and many others. TikTok has been accused of allowing the platform to be flooded with AI-generated recordings and promoting AI music creation, which UMG claims would massively dilute the royalty pool for human artists. UMG’s statement added that TikTok attempted to bully them into accepting a deal worth less than the previous one, far less than fair market value, and not reflective of their exponential growth. As a result, UMG will cease licensing its content to TikTok and TikTok Music services.

This move is significant as TikTok has been working to build a music streaming service to compete with the likes of Spotify and Apple Music. UMG’s decision is likely to have a substantial impact on the availability of music on the platform and could potentially affect TikTok’s efforts to establish itself as a major player in the music streaming industry.

The dispute between UMG and TikTok highlights the ongoing challenges and negotiations between music labels and digital platforms regarding fair compensation for artists and the use of AI-generated content. It also underscores the growing importance of such platforms in the music industry and the significant influence they have on the distribution and consumption of music.

The impact of this decision on both UMG and TikTok, as well as the broader implications for the music industry, remains to be seen. However, it is clear that the failure to reach an agreement between these two industry giants has the potential to reshape the landscape of music streaming and digital content distribution.

This article is based on the information provided by Forbes, The Wall Street Journal, Variety, Rolling Stone, and Reuters.