Indie Advocate Impala Backs Universal Music Group’s TikTok Pullout, Raises ‘Value Gap’ Concerns

Photo Credit: Impala Music

Impala Music backs UMG’s decision to part ways with TikTok, citing ‘value gap’ concerns and urging DSPs to address the ‘unintended consequences’ of proposed streaming reforms.Impala, the European organization for independent music companies and national associations, has been hard at work consulting its members on “moment economy” services like TikTok and their perceived value. The organization has also been focusing efforts on the question of recent streaming reforms proposed by DSPs like Spotify, Apple, and Deezer. In both cases, according to Impala, it’s an issue of “value gaps,” fixing existing ones while ensuring no new ones are created.

The previously underlined issue of a revised streaming plan also ties into the need for services like TikTok to collaborate with the independent music community to achieve fair licensing terms. With the addition of the EU’s new rules on artificial intelligence and its ethical use, Impala stresses an even more urgent need to address the role these platforms play in providing fair revenue for artists.

“TikTok and other ‘moment economy’ services are key partners,” says Helen Smith, Impala’s Executive Chair. “They play an important role in our music ecosystem and the licensing framework is clear: services need permission for the use of music, including soundalikes and AI adaptations. The new AI framework in Europe also helps set human-centered guide rails in this regard.”

“As set out in our streaming plan, there is an urgent need to secure fair revenues from these vital services. In line with this, Impala supports UMG’s stance on TikTok in relation to valuing music properly,” adds Mark Kitcatt, Chair of Impala’s streaming group and CEO of Everlasting Records and Popstock Distribuciones.“The independent community has adopted a similar approach at various points over the years with other services, from MTV to Apple to YouTube. We also reject arguments equating the use of music on TikTok to promotion. There is a huge value gap that must be addressed, but, beyond that, an exciting opportunity to explore new ways of generating and sharing revenues.”

“TikTok is at a pivotal moment in terms of renewing their licensing deals where they can show that they value music fairly on their platform. It’s a use of music that needs to be remunerated like any other; the question of promotion isn’t relevant,” concludes Dan Waite, chair of Impala’s digital committee and CEO of Better Noise Music.

“We wish to see independent labels, rightsholders, and artists receive fair pay for usage, and to have terms just as favorable as the largest majors renew their licenses on. Working together to better remunerate labels and artists across the whole industry is key. We urge TikTok and other services to respect this principle across the board.”

Impala members from 32 countries have also reiterated their call to work together to solve the “unintended negative consequences on independent music” of the recent revenue allocation reforms proposed by Deezer, Apple, and Spotify, noting that “adjustments can be made to avoid harm.” The organization calls for any changes in revenue allocation to be “properly assessed” by services in terms of the impact on the market as a whole, in line with Impala’s own proposals.