During a call with analysts, Universal Music Chairman and CEO Lucian Grange discussed the possibility of taking down music videos from TikTok as a result of a dispute over fees and other issues. The company’s chief digital officer, Michael Nash, expressed hope in recapturing lost revenue on other platforms like Reels from Meta Platforms or YouTube Shorts from Alphabet.
Impact of Potential Takedowns
Nash mentioned that the takedowns began earlier in the month, so it is too early to determine the full impact. However, he stated that Universal Music Group’s audio streaming consumption has remained stable both globally and regionally. In fact, there has been a slight increase in frontline and catalog consumption over the short period.
Data Insights
Data from Apptopia indicated a decline in year-on-year growth and time spent on TikTok amidst the dispute with Universal Music Group. The figures dropped from 1% in the two months leading up to the end of the deal to -3% in the second half of February.
Financial Performance and Restructuring
Following the announcement of a restructuring that will result in €125 million in annual savings, Universal Music Group’s shares rose by 4%. The fourth-quarter adjusted EBITDA saw a 9.2% increase to €677 million, driven by a 9% growth in revenue totaling €3.21 billion. Notable contributors to the revenue growth included artists like Taylor Swift, The Rolling Stones, Drake, Jung Kook, and Stray Kids.
In conclusion, Universal Music Group remains optimistic about finding solutions to the ongoing issues with TikTok while focusing on maintaining its financial performance and artist partnerships.
