In the 21st century, leveraging social media platforms has become an indispensable part of the music industry, and artists. TikTok, one of the most popular applications in this field, has become “a golden opportunity” for singers and artists to reach a massive audience and viewers. However, getting licensed and collecting royalties from this “big guy” is not easy. On February 27, 2024, Vietnam Copyright Development Joint Stock Company (“VCD”) officially reached a music licensing agreement with TikTok, opening a new door in its business development journey. Therefore, in the article below, we will learn in detail about this event and the benefits of reaching a music licensing agreement for VCD and TikTok.
1. TikTok – A playground that helps access many new opportunities
TikTok, or Douyin in China, is a Chinese music video and social networking platform created by ByteDance founder Truong Nhat Minh. TikTok is used to create short music, lip sync, dance, comedy, and talent videos from 3 seconds to 10 minutes, and short looping videos from 3 to 60 seconds.
Just a few years ago, YouTube, and ZingMP3… were some platforms that singers and artists prioritized to use to spread their music products to the masses. They will use the view rate on these platforms to evaluate their influence, success, and fan reception.
TikTok, a short video-sharing platform, has quickly become a global phenomenon in the past 3-4 years since the Covid 19 epidemic broke out. With billions of users around the world, TikTok is considered not only an entertainment place with trendy dance performances but also a great business and advertising opportunity. From users, singers, and artists,… to entrepreneurs, businesses from different industries have recognized the potential of TikTok and started taking advantage of this platform to reach their audiences.
2. Music licensing agreement: VCD’s breakthrough in managing and trading music products of singers and artists
The licensing agreement between VCD and TikTok is considered an important breakthrough in the company’s development. Under this agreement, a musical work is a piece of music owned, controlled, and/or managed by VCD, in whole or in part. TikTok and TikTok Affiliates are allowed to legally use the musical works that VCD manages, including doing the following: copying and storing musical works on the server; allowing users, TikTok Affiliates, and TikTok to record and store live streamed content; allowing the use and creation of copies of musical works… In general, TikTok and TikTok Affiliates have the right to use musical works that VCD manages for commercial exploitation on the TikTok platform.
Regarding royalty payments, according to this agreement, Tik Tok agrees to pay royalties to VCD on a monthly schedule and VCD will receive royalty payments on a quarterly schedule within the period as agreed by both parties through quarterly accounting reports. Regarding the method of calculating royalties, TikTok will be based on the total number of videos using musical works that VCD manages and created on TikTok as the basis for royalty payment. The amount of royalties that artists and authors receive will be based on the royalties that VCD collects from TikTok as well as on the contractual agreement between VCD and the artists and authors.
3. Benefits for both sides
VCD is proud and affirmed to be one of the pioneering businesses in the field of copyright protection for artists and authors. The music licensing agreement with TikTok not only benefits the artists and authors whose musical works VCD manages but also brings many opportunities to TikTok.
First of all, for artists and authors whose musical works are managed by VCD, participating in a music licensing agreement with TikTok will bring many benefits for development as follows:
- First is to help artists and authors increase their income: artists and authors authorizing VCD to manage musical works and music licensing agreements with TikTok will bring a stable source of income. for artists and authors because they will be paid for their creations, thereby increasing revenue from their social media platforms, besides YouTube, Spotify… and other platforms. other music.
- Second, it helps increase presence on social networks and the public: TikTok’s use of musical works by artists and authors will help artists and authors reach a large number of users worldwide bridge. In particular, with modern tools, their old songs can be given new life and become “viral”. TikTok is also a popular platform for sharing creative music content. Using an artist’s music on TikTok can help generate fan interest, increase engagement, and promote the sharing of their music (especially when launching new music works). ).
- Third is to create collaboration and advertising opportunities: Through being on TikTok, artists and authors can create collaboration and advertising opportunities with brands, manufacturers, or partners in other work. This can help them expand their influence and create new business opportunities.
By partnering with businesses like VCD, TikTok also strengthens its position in the online advertising market and attracts more businesses that want to join this platform and brings many benefits as follows:
- One is content diversification: The music licensing agreement between VCD and TikTok allows TikTok to use different songs that VCD manages from artists and authors. This creates a diverse and rich environment for users, helping TikTok attract a larger audience.
- Second is to increase advertising revenue: using and integrating musical works from famous artists and authors in advertising clips and selling products can create attractive and engaging content. user attention. This can help TikTok increase advertising revenue when brands want to advertise in videos using their music.
- Third is to create a connection with the music community: by partnering with music management companies such as VCD, TikTok can build relationships with the music community, thereby expanding opportunities for future cooperation and new business opportunities.
The music licensing agreement between VCD and TikTok is a typical example of media companies recognizing, respecting, and rewarding music makers and their products when they are used on online platforms.
