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Is TikTok (or ByteDance) slowly morphing into a record company? - Music Business Worldwide

Whenever the idea of TikTok becoming a record label is raised in music biz circles, the suggestion is typically scoffed at.
But the evidence is building that such a description might one day fit.
In March, TikTok launched its own distribution service. Dubbed ‘SoundOn’, it lets artists upload their music to TikTok, RESSO, and other platforms like Spotify, Apple Music and Instagram.
TikTok describes SoundOn as “an all-in-one platform for music marketing and distribution”, and says that it was designed “to empower new and undiscovered artists”.

The TuneCore-powered distro service’s beta launched in September. At the time, TikTok’s Global Head of Music Ole Obermann told us that, “through SoundOn we’re going to organise the ecosystem of unsigned artists in a way that doesn’t exist today and has never existed before”.
He added: “I think that’s going to make it easier for artists to find their fans. And then for labels and publishers to find those artists. The [industry’s] entire A&R process, I think, will become more efficient off the back of it.”

SoundOn also acts as an incubator program, and artists signing up to the platform get access to audience insight and development tools, as well as “expert advice” from a dedicated SoundOn artist team.
TikTok claims that SoundOn is already providing additional opportunities for artists and music creators who start on TikTok, and notes that artists have already gone on to sign record and publishing deals, and to work with co-writers and “established names”.

With TikTok performing functions for artists like marketing, distribution, discovery and development, some may argue that TikTok is already well on its way to becoming a record label. And over in Asia, TikTok parent ByteDance is giving us even more of a hint of what’s coming down the line.
MBW has spotted that ByteDance is hiring for an “A&R” role which, according to the job description, looks very similar to the long-established role of A&R at a record label.
Exhibit A: The first responsibility listed for this Jakarta-based role is “finding and signing new music talent”.
According to ByteDance, the successful candidate will also “provide professional expertise and support in the design, development and implementation of the talent review process that is required to achieve business goals and results in the creation of an internal bench of top talent”.
Many of the other responsibilities and requirements listed in the ad also resemble what you might see in a job description for an A&R role at a record label. In fact, we’d suspect the eventual candidate might even join ByteDance from a record company.
Behold this wording from the ad:
It’s not entirely clear if the role is for TikTok or ByteDance’s music streaming service, Resso, or for Qishui Yinyue, the new music streaming service launched by ByteDance in China last month.
It’s also not uncommon for a digital service provider to perform some record label functions and support independent artists financially.
Chinese tech giant NetEase for example, whose subsidiary Cloud Village (which operates streaming service NetEase Cloud Music) listed on the Hong Kong Stock Exchange in December, is well-known for working with independent artists via its Project Cloud Ladder program.
The company calls itself a “natural incubator of music talent looking for an audience”. By the end of 2021, Cloud Village says it was serving more than 400,000 registered independent artists on its platform.
Within its content library, about 1.9 million music tracks came from those registered independent artists in 2021, an increase of approximately 80% versus the end of 2020.
In a letter issued to investors when Cloud Village went public in December, NetEase CEO William Ding said that NetEase Cloud Music “is committed to investing in our support of independent artists”.
He continued: “For those who pursue music as your dream, we hope that you no longer need to worry about the right stage for your talent and passion, and that your family and friends no longer need to worry about you financially.”
NetEase’s biggest rival in China, Tencent Music Entertainment, also runs an indie musician platform called ‘Tencent Musician Platform’.
Launched in 2017, Tencent claims that its program has “provided powerful backing for musicians to inspire and support them in continuing music creation”.
In 2021, the number of registered musicians on the program grew to more than 300,000, marking an increase of 51% year-on-year.
During the year, more than 2.1 million songs from independent artists were distributed through the platform.
TME says that it offers indie artists “comprehensive incentive plans and music collection projects” and also claims to be “the first platform in the industry to introduce a new monetization model with streaming page advertising revenue sharing”.
The company also says that it has partnered with Tencent Sports, Tencent Games, TME Institute of Music, and more “to provide an even broader crossover platform to further help indie musicians ramp up their music promotion and distribution”.
Also, Tencent might not be allowed to sign exclusive deals with labels anymore, but it is permitted to keep its exclusive deals with independent artists, with a time limit of three years for such agreements.
DSP plans to work directly with artists aren’t always successful, however.
Spotify for example, started offering artists direct distribution deals (including paying out advances) itself back in 2018, but then quickly abandoned the idea.
Spotify also launched its own DIY distribution service in 2018, only to abruptly pull the service just a few months later.
India based JioSaavn was another example of a streaming platform striking deals with indie artists, via its in-house label and artist services division Artist Originals, which launched in 2017.
AO wasn’t destined to last either. Billboard recently reported that AO has been shuttered, and that JioSaavn has ‘been shopping the Artist Originals catalog but has thus far been unsuccessful in striking a deal’.
TikTok has already proven itself to be a key artist discovery platform for many of its 1 billion-plus global Monthly Active Users, as well as a rich A&R source for record labels.
The question now is, what will the power dynamic of the music industry look like in the future, if TikTok starts signing artists before the labels do.Music Business Worldwide
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