TikTok’s decision to boycott Merlin and pursue direct deals with Merlin’s member labels is a troubling move that undermines the rights of labels to choose how their music is licensed. While TikTok frames this shift as a way to tackle streaming fraud, it’s clear that the real motive is to weaken the bargaining power of independent labels and use that leverage to suppress rates.
Merlin has built strong partnerships over the last 16 years with more than 40 digital services worldwide. These partners recognize the value Merlin brings—efficiency, scale, and a deep understanding of the independent music community. TikTok’s move to sideline Merlin is not about protecting against fraud but about undermining the ability of independent labels to achieve competitive terms, not just now but for the long term. The ultimate consequence of its refusal to negotiate with Merlin for the music that earns TikTok billions of dollars, will be to damage artists’ ability to make a living from their art.
This tactic is not new. It echoes the historical struggles of the music industry with partners such as terrestrial radio and MTV, both of which profited massively from the use of recorded music while refusing to pay artists under the pretext of “promotional value” or “exposure” — ostensibly for the sale of an artist’s CDs or LPs. In this largely digital economy the stream is the sale – and it has been widely reported that TikTok pays rights holders far less than other services for equivalent uses of music.
Independent labels choose Merlin to license their rights, because of its expertise, experience and track record in striking these kinds of deals. This ensures compensation at levels enabling them to compete with the majors and protects independents from being unfairly exploited. TikTok’s decision to bypass Merlin and demand direct deals is an assault on the freedom of small and medium sized enterprises to determine their own business strategies. The fact that TikTok is giving Merlin members a matter of days to accept TikTok’s terms or lose access to its massive platform, is an unfair exercise of its market power.
This apparent divide-and-conquer strategy is, we believe, designed to keep payouts for indie artists low by exploiting their perceived reliance on TikTok’s platform. It’s not about addressing fraud or improving the digital music ecosystem. In fact, by exponentially multiplying the number of license deals TikTok will need to strike and by losing Merlin as a partner in the fight against fraudulent material, more fraud is likely to ensue. Merlin simplifies licensing, making it easier for platforms to access diverse, independent music. Fragmenting this system hurts artists and fans and will limit the range of music available on TikTok.
At its core, this issue is about respecting the rights of independent labels to determine how their music is licensed. TikTok’s behavior doesn’t reflect a problem with Merlin; it reflects TikTok’s lack of respect for the value of music. Every other major platform has struck responsible deals with Merlin that balance the needs of the service with optimized compensation for artists. TikTok’s refusal to do so sets a dangerous precedent for recording artists and their labels.
TikTok must stop undermining and disrespecting the independent music community. It can do this by working with the labels’ rights management agency of choice to establish a fair, transparent licensing system that benefits all stakeholders in the music ecosystem. Independent labels have the right to choose their representatives to negotiate deals that truly reflect the value of their artists’ creative contributions. Anything less is a disservice to the artists and the fans and undermines the very fabric of music culture.
Dr. Richard James Burgess is an acclaimed musician, singer, songwriter, record producer, composer, author, manager, marketer and inventor, who presently serves as the president and CEO of the American Association of Independent Music (A2IM).