Universal Music Group and Spotify — the world’s largest music company and the world’s largest paid music-subscription service —have unveiled an expansion of their “strategic relationship” in an announcement that has very few details but is likely the opening of a new maneuver in UMG’s ongoing battle with TikTok.
UMG and the China-based platform, which has been the leading source of music discovery for the past five years, have been in a standoff over multiple issues, primarily the platform’s low royalty payments and AI policies, since their licensing agreement expired earlier this year. Most artists under recording or publishing contracts with Universal have seen their music muted on TikTok, depriving many of them of their primary means of music promotion, a situation that a led a substantial number of them to voice frustration.
Specifically, the new initiatives include UMG artists being able to share short pre-release teasers and pre-save opportunities on Spotify, and the ability to host music videos in the U.S. (Spotify launched a video program in beta in 11 overseas countries earlier this month) — all options that are widely available from most major artists’ social media accounts. The announcement also vaguely describes how the partnership will “further amplify music discovery and social interaction and enhance fan experiences across the platform for UMG’s family of artists and songwriters” and “make available a series of new promotional and social features that will help artists drive interaction and generate excitement around new releases.” It also speaks of additional features that allow fans to discover artists and propel virality of new releases,” with more details coming in the “near future.”
The two companies have several potential shared benefits from the expanded partnership, not least of which is some leverage against TikTok. UMG also can say that it has secured an alternative promotion outlet for its artists, and Spotify has found another (possibly minor) source of revenue.
UMG chairman/CEO Lucian Grainge said in a statement, “We’re excited to broaden our relationship with Spotify through the introduction of new content offerings and collaborations that will bring deeper ‘social music’ experiences to the platform. We’re always striving to expand opportunities for UMG artists and songwriters to elevate engagement with their fans, especially in the introduction of new music and artist-centric initiatives. Spotify has been a committed partner in creating tools that help maximize attribution and fair pay for artists and songwriters, and this demonstrates that win-win partnerships between music companies and platforms create an environment where innovation, artist compensation and next-generation fan experiences can coexist and move the industry forward.”
Spotify co-founder/CEO Daniel Ek, said, “UMG has consistently been a progressive partner on behalf of their artists and songwriters, contributing to our product development efforts of experimental tools and adopting them early to help artists stand out. The forthcoming features will put more power in the hands of artists and their teams to help them authentically express themselves, efficiently promote their work, and better monetize their art.”
