Record label

TikTok thinking about next steps, becoming more like a record label?

TikTok thinking about next steps, becoming more like a record label?

Paris: With one billion users, TikTok has quickly become one of the biggest players in the music industry and now aims to revolutionize the way artists are discovered and compensated.

Hit stories such as Lil Nas X – whose “Old Town Road” became the best-selling US single of all time after going viral on TikTok – demonstrated the power of the short-form video app.

Major labels, which at first panicked over TikTokers using their music without a license, quickly realized they had to get on board.

“When a disruptive technology platform appears, it’s understandable that rights holders are uncomfortable,” TikTok music director Ole Obermann told AFP.

He was brought in from Warner Music in December 2019 to do some label deals.

“Obviously we had to shell out a lot of money. The good news is that we’re totally laid off now and we talk to them every day about new things that haven’t been done before.”

– ‘Change everything’ –

Meanwhile, TikTok continues to create viral sensations that are reshaping the music landscape.

Sometimes it’s old songs that bring new life, like the recent craze for “Dreams” by Fleetwood Mac or “Rasputin” by Boney M.

But often they are new or independent artists, who no longer need the support of record companies to find a massive audience.

“It’s hard to overstate how much this changes everything, said Tom Rosenthal, a London-based musician whose songs have been used on 1.6 million TikTok videos.

“Major record labels kinda suck because traditional marketing systems don’t apply anymore. (TikTok) is a great leveler. You can do it yourself,” he said.

Some artists become huge without even knowing the application.

This was the case with Nigerian popstar CKay. Her 2019 single “Love Nwantiti” was a decent-sized hit in her home country, but then TikTok users grabbed it, and by November 2021 it had surpassed 15 billion streams and topped the charts of Asia to Europe via North America.

– “We’re moving on to something” –

TikTok is already thinking about next steps.

Its latest service, SoundOn, offers unsigned artists an easier way to upload songs, get paid and find distribution.

Obermann hints that this could see TikTok becoming more of a record label.

“We think we’re onto something,” he said, pointing to recent viral successes from unsigned acts Muni Lang and Games We Play.

“It’s still too early to decide exactly how we work with these artists to build their careers. But we see we can play a much bigger role in the artist discovery process in a very hands-on way.”

– Rejected request –

Obermann also hopes to revolutionize the way songs are used for commercials — a part of the business that’s currently worth around $500 million a year worldwide, but could be worth much more.

“Traditionally that meant something like a big brand of Celine Dion’s ‘I Drove All Night’ licensed car for their TV commercials,” he said.

“But we have about a million small and medium businesses that want to do TikTok ads using music. And that’s an absolute nightmare because our licenses don’t include commercial use.”

Currently, every commercial use requires TikTok to obtain special permission from the label and all songwriters, which can take months.

“It’s extremely inefficient. If we could redesign the way it works, (the global licensing business) would grow from $500 million to billions in a few years. There’s such pent-up demand. We’re really working on that.”

Other ideas include live concerts and direct sales, with some artists already whipping up vinyl and merchandise through the platform.

But will TikTok disappear as quickly as it arrived? The ghost of MySpace, a former revolutionary force in music, haunts its successors.

“It’s something we think about every day when we wake up,” Obermann said.

“We’re confident that TikTok has shifted hugely into the cultural zeitgeist at this point. But it’s still day one and you have to keep reinventing yourself to stay relevant.”