TikTok's influence on the music industry is powerful – and soon, it might be taking the place of Spotify, Apple Music, and other popular streaming services.
TikTok, the social media platform owned by China-based ByteDance, has become a titan in the music industry in the past couple of years. In 2021, more than 175 songs that trended on TikTok hit the Billboard Top 100, according to TikTok's annual music report. And that popularity is mainly driven by young people; a Pew Research Center poll reports that 67% of teenagers use TikTok, with 16% admitting that they're on the app almost constantly. And these consumers can make or break musical artists' careers. Some artists go from streams in the single digits to celebrities overnight when clips from their songs go viral, while older music is rediscovered the same way. Record labels instruct artists to make their songs go viral on the platform just to garner streams, and other brands scramble to sign artists without contracts when their songs hit the mainstream.
The social media app mainly shows listeners music they can listen to on other streaming platforms, such as Apple Music and Spotify. But TikTok is ready to take the lead in the industry by creating a music streaming app of its own. While details of the deal have not been disclosed, CNBC reporters found that ByteDance filed a trademark for "TikTok Music" in May, indicating that the company is positioning itself to make moves. They've also partnered with and obtained licensing agreements from Universal Music Group, Sony Music Entertainment, and Warner Music Group. However, unlike Spotify or Apple Music, TikTok does not pay royalties to the songs it streams. But this could change, CNBC industry analysts report, if they move into the music streaming industry as they’ll need to entice artists to become involved.