I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. If you've been scrolling TikTok recently and you've noticed influencers out there dancing to videos with no sound, silent disco style, that is actually the fallout between a complicated licensing battle between two giants, TikTok and Universal Music Group.

The The breakdown of licensing negotiations between these two companies has impacted users, content creators, and even brands, and is a really fascinating case for where the music industry is right now in the era of streaming. Here's everything you need to know about the stalemate between two of the most culturally influential brands of our time. Tiktok and UMG started these conversations initially because their licensing agreement was up for renewal. And then when no agreement was reached, the agreement expired on January 31st of this year. Universal Music Group, home to artists you might have heard of, Taylor Swift, Drake, Ariana Grande, took a hard stance against TikTok, accusing the platform of offering inadequate compensation for music usage and allowing the proliferation of AI-generated content that cuts into royalties for musicians. To really hammer that point home, Universal decided to take its music off TikTok, leaving a blank space, to quote one of the artists, No longer on TikTok, in the app's library and muting audio in existing videos that featured Universal's tracks. On Tuesday, TikTok escalated tensions by removing songs published by Universal. Damn. Initially, it was just songs that were distributed or owned by Universal, but extending this no-fly list to Music published by Universal means that even music that was written but not performed, a songwriters under contract with Universal Music Publishing Group are getting removed from the platform.

So artists like Beyoncé, Harry Style, Bad Bunny, even though they aren't repped by Universal are still having songs pulled off the platform because writers represented by UMPG were involved in the making of that song. So how badly are artists paid for their music on TikTok, really? Is it so bad that it justifies all of this? Well, yeah, the royalty situation is pretty bad. Artists are paid just three cents per video that uses their song, and that's per video, not per view. So when Megan The Stalian went viral for her very first Savage Music Challenge that got 21 million views, she got paid three cents for that one. 100 videos would need to be posted using her song to just get three bucks. So yeah, the streaming royalties on TikTok are not amazing. But some artists might say that's not what really matters. And that's one of the voices that we can't let get drowned out in the shouting match between TikTok and UMG. It's the voices of the artists. These are the people who ultimately have the right to say where their music can and cannot live. Historically, clashes between music companies and tech platforms are not uncommon during negotiations over content licenses.

But Universal taking its music off the platform is a nuclear move that's seen more rarely, but not never. You might remember, Warner Music temporarily removed music videos from YouTube in 2008, not too dissimilarly from Universal's move with TikTok Now. Tiktok is obviously a pivotal promotional tool for the music industry. We've I've seen songs from decades ago hit top music charts again after going viral on TikTok through memes and trends. But because Universal represents such heavy hitters, removal of their music catalog does not represent a significant blow to TikTok. So who wins the TikTok versus Universal showdown will really come down to who needs it more. Is TikTok driving new discovery of Universal music, or is Universal's music catalog driving users to spend more time on TikTok? The intersection of technology and entertainment will only get messier as technology becomes a larger part of how we consume and interact with music. So as we navigate these waters, we'll need to come back down to Earth and remember to listen to the people who are affected most, the artists we know and love and advocate for them. For today's tip, you can take straight to the bank.

If you're a freelancer or a small business owner and you rely on a platform to reach your customer, whether it's TikTok, Instagram, YouTube, Facebook, any digital platform, you need to consider how your business is at the whims of these platforms. So the tip is, if it makes sense for your business, you'll want your customer's final destination to be somewhere off the app, like your website, newsletter, or a space IRL. The less vulnerable you are to the clash of the Titans, the more stable your business will be for you and for your customers.

Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Lavoy. Our researcher is Emily Holmes. Do you need some Money Rehab? And let's Let's be honest, we all do. So email us your moneyquestions, moneyrehab@moneynewsnetwork. Com, to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at Money News and TikTok at Money News Network.work for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself, which is the most important investment you can make.