Today, countless independent music distributors offer artists the means to place their music on streaming platforms while equipping them with various promotional tools to track data and market their work. These distributors have seen tremendous growth over the past couple of years, accompanying the waning dependence on record labels. As of March 9, 2022, TikTok entered the music distribution space, launching SoundOn in the US, UK, Brazil, and Indonesia. With an established reputation for dominating new music, TikTok’s expansion into this space may entirely disrupt the independent distribution industry.
How TikTok Influenced the Popularity of Independent Distribution
Independent artists have been taking over the music industry for the past few years. In 2021, MIDiA reported that self-distributing artists increased their market share to 5.3% and generated over $1.5 billion in revenue.1 Independent artists are not only becoming more prolific; they are the driving force of new music, as evidenced by the increased number of tracks uploaded to Spotify — growing to over 60,000 per day. In 2020 and 2021, independent artists uploaded roughly eight times as many tracks to Spotify than Sony, Warner, and Universal combined.2
So, what has happened recently to give independent artists the confidence to release music on their own? Again, TikTok. As the BBC puts it, the app has “revolutionized the way people discover new music – removing many of the traditional barriers that smaller, DIY artists used to face.”3 With the potential to build audiences overnight, the need for labels to handle artists’ rights and marketing diminishes greatly. Not only can today’s artists reach a wider audience than ever before, but all of the valuable data which labels usually collect on behalf of artists is now given freely to all content creators. Such a comprehensive stretching algorithm’s impact is only starting to be realized. As reported by the company, “over 175 songs that trended on TikTok in 2021 charted on the Billboard Hot 100.” That same year, “approximately 430 songs surpassed 1 billion video views as TikTok sounds.”4 These songs may have never reached the millions of ears that TikTok’s video distribution allowed.
Cultivating an audience to listen to a song once it’s released is just half of the battle — figuring out how to release that music is another story. TikTok has become the place for A&R’s to search for up-and-coming musicians, so making one viral hit could be all it takes to get signed to a label if that is what the artist desires. If not, then finding the right independent distributor is the second stretch. TikTok, which has established itself as the monolith for music marketing, has set its sight on centralizing all aspects of the industry on its platform.
More Than Music Marketing
Alongside the excitement surrounding new music being shared, older songs began to resurface through the trends. The issue was that TikTok never obtained the rights to those songs and had no system to compensate the artists for their use. To dampen the criticism that they received for not paying artists for the use of their music (as well as giving brands unrestricted use of copyrighted sounds), TikTok began seeking licensing deals with labels and publishing companies. The first was with Merlin in January 2020, which controls roughly 15% of the global recorded music market.5 Then, in July 2020, TikTok struck a deal with the National Music Publishers’ Association (NMPA), allowing artists in their repertoire to opt-in for TikTok distribution.6 Although the NMPA encapsulates the three major music publishers, TikTok still sought out individual deals with each company. The Sony Music deal occurred in November 20207, with Warner Music Publishing following in December.8 Finally, Universal Music Group (UMG) solidified an agreement in February 2021, pulling their catalog from TikTok-competitor “Triller,” granting the app exclusive access to the entire UMG library.9
Now that TikTok had the proper licenses from nearly every major player in the industry, it could operate freely without the threat of lawsuits for violating copyrights. However, the company was still only licensing these songs from other entities and paying to do so. So it only makes sense that the next move for an organization looking to control the music industry would be distributing the music themselves. This venture began with the United Masters deal in August 2020 — this partnership would be TikTok’s first step into music distribution and licensing. The partnership’s aim was the full integration of United Master’s distribution technology into the TikTok app, where musicians could capitalize on trending moments while distributing their sounds directly from the app to other streaming platforms. Artists would then be allowed to opt-in to United Master’s Commercial Music Library, which enables brands who pay for a blanket license from United Masters to use any content in this package.10 With a service like this, TikTok hoped to bolster creativity and give artists a better chance at profiting off viral moments.
Becoming the Distributor
It soon became apparent that United Masters was not the best partner for TikTok, as the distribution company’s operations erred in the tendencies of a traditional record label. Outside of TikTok, the only other companies they offered free distribution to were Spotify, Apple Music, iTunes, YouTube, and SoundCloud. United Masters also entered contracts with their artists, which maintained the company’s right of first refusal should one of their artists blow up and be approached by a brand or have an actual label try to sign them.11 This would have significantly stifled the creativity that TikTok was trying to cultivate through such a deal.
Having music distributed through their site would make everything easier for TikTok by having all rights and royalty streams controlled directly by the company. Thus, SoundOn was born. Songs uploaded to this platform are distributed through TuneCore, one of the largest independent distributors on the market today. Artists can upload tracks for free and maintain 100% of their royalties earned through TikTok and other ByteDance-owned entities, Resso and CapCut. For all other platforms, such as Spotify and Apple Music, artists still keep all royalties for the first term (12 months) and 90% in the following years.12 Uploading music through SoundOn also gives artists unique audience-insight data on TikTok and special consideration from SoundOn’s team for TikTok editorial placement and free promotion in the app. On top of this, independent artists will have access to features previously only granted to those with a significant label connection. These features include having a music tab added to their TikTok profile, which makes it easier for users to find all of an artist’s songs in one place. And perhaps the most valuable advantage, which was never available before this moment: being able to request verification.
Why Verification Matters in the Online Space
Artists who upload through SoundOn can request verification for their TikTok profile. The blue checkmark is coveted for a reason; no matter which social media platform, studies show that being verified leads to increased engagement. For example, in 2020, research of over 6.5 million Instagram accounts by HypeAuditor found that “on average verified Instagram accounts have a 30% higher engagement than regular accounts.”13 “Engagement” here was calculated by adding likes, comments, and shares, divided by followers. This may be because social media platforms give preferential treatment to verified creators, which has long been speculated. However, it could also be a phenomenon on the user’s side that people find verified accounts more trustworthy and are therefore more likely to interact with them.14 For musicians, verification ultimately means more credibility as a creator and, as observed, more interactions on every video, leading to faster growth.
With the heightened emphasis on social media presence for musicians nowadays, the benefits which SoundOn offers make it an enticing choice for self-releasing artists. SoundOn can potentially insert itself as a significant player in the distribution industry. Gaining unique insights into the most impactful social media app is a considerable advantage of using the platform. To be granted special access to tools that previously only artists signed to influential labels were given is another serious incentive. Overall, the new distribution service offers artists the chance to have an edge on TikTok, earn credibility for their image, and receive proper credit for their work. How large SoundOn will become has yet to be realized, but the initiation of the service makes one thing clear: TikTok’s goal is to control every aspect of the music industry.
- Mulligan, Mark. “Recorded Music Market Shares 2021 – Red Letter Year.” Music Industry Blog, March 18, 2022. https://musicindustryblog.wordpress.com/category/artists-direct/#:~:text=But%20it%20was%2C%20once%20again,done%20every%20year%20since%202015.
- Ingham, Tim. “CD Baby Generated $125M from Spotify, Apple Music and Others in 2020.” Music Business Worldwide, March 5, 2021. https://www.musicbusinessworldwide.com/cd-baby-collected-125m-from-digital-platforms-like-spotify-apple-music-and-youtube-music-in-2020/.
- Savage, Mark. “More and More Musicians Are Releasing Their Own Music: Here’s Why.” BBC News. BBC, January 23, 2022. https://www.bbc.com/news/entertainment-arts-60051802.
- “Year on TikTok 2021 Music Report.” Newsroom. TikTok, December 13, 2021. https://newsroom.tiktok.com/en-us/year-on-tiktok-music-report-2021.
- Stassen, Murray. “TikTok Signs Global Licensing Deal with Indie Label Agency Merlin.” Music Business Worldwide, January 23, 2020. https://www.musicbusinessworldwide.com/tiktok-signs-global-licensing-deal-with-indie-label-agency-merlin/.
- Stassen, Murray. “TikTok Inks Global Deal with Music Publishers (Who Previously Threatened to Sue It).” Music Business Worldwide, July 23, 2020. https://www.musicbusinessworldwide.com/tiktok-inks-global-multi-year-deal-with-music-publishers/.
- Ingham, Tim. “TikTok and Sony Music Ink Licensing Deal for Major’s ‘Roster of Global Superstars and Exciting Emerging Artists’.” Music Business Worldwide, November 2, 2020. https://www.musicbusinessworldwide.com/tiktok-and-sony-music-ink-licensing-deal-for-majors-roster-of-global-superstars-and-exciting-emerging-artists/.
- Stassen, Murray. “Warner Music Group Inks Licensing Deal with TikTok.” Music Business Worldwide, January 4, 2021. https://www.musicbusinessworldwide.com/warner-music-group-inks-licensing-deal-with-tiktok/.
- Stassen, Murray. “TikTok and Universal Music Group Sign Global Licensing Deal.” Music Business Worldwide, February 8, 2021. https://www.musicbusinessworldwide.com/tiktok-and-universal-music-group-sign-global-licensing-deal/.
- Perez, Sarah. “TikTok Announces a Deal with UnitedMasters, Its First Music Distribution Partnership.” TechCrunch. TechCrunch, August 17, 2020. https://techcrunch.com/2020/08/17/tiktok-announces-a-deal-with-unitedmasters-its-first-music-distribution-partnership/.
- Moon, Mariella. “TikTok’s SoundOn Platform Lets Musicians Directly Share Their Own Tracks.” Engadget, March 10, 2022. https://www.engadget.com/tiktok-soundon-music-distribution-platform-080515441.html#:~:text=They’ll%20get%20verified%20on,to%20use%20the%20platform%20exclusively.
- Baklanov, Nick. “In-Depth Research of Instagram Verification: Does Verification Badge Impact Engagement?” HypeAuditor, February 6, 2020. https://hypeauditor.com/blog/instagram-verification-badge/.
- Grome, Justin. “What Social Media Verification Can Mean For Your Brand – And How To Get It.” Forbes. Forbes Magazine, March 16, 2021. https://www.forbes.com/sites/forbesbusinesscouncil/2021/03/16/what-social-media-verification-can-mean-for-your-brand—and-how-to-get-it/?sh=32bf4d11bdd6.