Hey! First things first, I gotta thank The Weeknd for giving us an instant meme from the Super Bowl halftime show. That performance was designed for social media. The casting call for The Weeknd lookalikes literally asked for volunteers “who can move, and follow basic instruction, like a TikTok dance!”
The show wasn’t cheap. The Weeknd put up $7 million on top of the $10 million that the NFL typically covers. But as many concert producers have said, artists have to invest in the moments that will look great on Instagram, and there’s no bigger stage than the Super Bowl. The added exposure (and memes!) should help The Weeknd sell his upcoming tour in 2022.
This week’s memo breaks down Triller’s dispute with Universal Music Group and Joe Budden’s partnership with Patreon. And if you haven’t already, make sure you check the latest podcast episode! I posted the webinar recording on The Best Hip-Hop Album Rollouts of All Time with Ernest Wilkins of Office Hours.
Read more about the dispute in Music Business Worldwide.
Triller, Universal Music Group and the ongoing fight over licensing
Last week, Universal Music Group pulled its catalog from the short-form video network due to withheld payments and a refusal to negotiate moving forward. Triller has refuted UMG’s claims and told Variety “Triller does not need a deal with UMG to continue operating.” Damn. The two companies are out here jawing back and forth like Tom Brady and Tyrann Matthieu in the Super Bowl. But for better or worse, Triller is the Honey Badger in this situation.
A turn for the worst. Ironically, Triller was seen as the app with its licensing agreements in place. Artists get paid for full streams! Several hip-hop artists have invested in it. But there’s a natural tension between content owners and the social media platforms that rely on their content. No company is above it.
Songwriters need love too. According to L.A. Times, Triller had licensing agreements with Universal Music Group, but not Universal Music Publishing Group. If that’s true, then that means Triller paid the recording artists, but not the songwriters.
To double down on this, last summer, Music Business Worldwide reported that National Music Publishers Association CEO & President David Israelite called out Triller’s issues “The pattern of tech platforms asking for forgiveness instead of permission to use songwriter’s work must stop. Triller must legitimize its business by properly licensing all music on its platforms.” And two days ago, Israelite posted on Instagram that “Famous artists care about songwriters. Just because they use your company to promote their art doesn’t mean they will stand by you if you don’t respect all music creators.”
Triller’s not alone here. TikTok has been criticized by both major labels and publishers for similar. But today, TikTok just announced a new global licensing alliance with both UMG and UMPG. Gotta love the timing! But TikTok can flex its 800M+ monthly active users and its influence on UMG’s artists as a bargaining chip in negotiations. Meanwhile, Triller has 65M+ monthly active users. It has a fraction of the users and a fraction of the clout.
Triller positioned itself as a platform focused on music, hip-hop specifically, and had more tools for creators to make dope do-it-yourself videos. But the distinction between Triller and TikTok has blurred. TikTok’s hip-hop focus is now as strong as ever, and both apps have adopted each other’s features. How long until they both have a version of Snapchat Stories?
Top-down vs bottom-up. So far, Triller, like many creator-first apps, acquires users in quality, not quantity. It’s different than TikTok, which attracts the masses because it appeals to casual users, and therefore attract creators due to its audience size. Triller was top-down, while TikTok was bottom-up. Similarly, even though Twitch has better livestream tools than Instagram, it can’t match the reach of an IG Live session.
Runner-up status. The best-case scenario for Triller is to be the Lyft to TikTok’s Uber. Lyft has a quarter of the users of Uber, but it’s still big enough to be a formidable presence. Triller also needs its own viral moments or trends. The closest thing has been the boxing matches with Mike Tyson vs. Roy Jones, Jr and Jake Paul vs. Nate Robinson fights. Triller launched The Fight Club to keep Snoop Dogg’s legendary commentary going. It’s the most unique asset it has at the moment.
Read more about Triller in Digiday.
Let’s change the culture of investing
Public.com is an investing platform you should check out. Here’s why I like it: I can buy any stock for any amount of money, share ideas with my network, it’s free to use, $0 fees on standard trades, and no minimums.
Let’s be real–most trading platforms are pretty dry! Public makes it fun.
Offer valid for U.S. residents 18+ and subject to account approval. See Public.com/disclosures/
Joe Budden, Patreon, and the quest for equity
Last week, Joe Budden brought his podcast network to Patreon and was named the company’s Head of Creator Equity.
Budden’s end goal. In August I wrote about his podcast ending its two-year exclusivity on Spotify. His success validated Spotify’s podcast strategy, but he never got the nine-figure checks that Joe Rogan, The Ringer, or Gimlet got. In a recent episode, Budden said that in year two, Spotify offered him $21 million and all his rights, but he turned it down.
Get in on the upside. Budden said he joined Patreon because he’s seen too many companies make bank off the creators who help build platforms, but the creators never got in on the upside. Patreon has always positioned itself as creator-friendly. It takes 12% of the revenue that content creators generate on the platform.
It sounds good and all, but there are two important questions:
- Do Patreon creators have equity in Patreon? I doubt it. But I assume that’s what Joe wants. Patreon is now valued at $1.2B and plans to go public this year. Is there enough time to make room on its cap table for the service’s top creators, especially those who gross $200,000 annually? Budden himself may have equity in Patreon as part of his new role and this move, but we’ll see about the rest.
- How will Patreon help The Joe Budden Network? Patreon’s value prop is helping creators get paid by their fans. But The Joe Budden Podcast never had this issue. His merch and live shows were always in high demand. I went to a live show in 2018 in San Francisco. Tickets sold out so quickly I had to bought mine off someone on Twitter! And this was before the Spotify deal. Demand was never the issue.
The Joe Budden Network is now home to two other podcasts—”Girl I Guess” and “See, The Thing Is…” It doesn’t need Patreon to build its audience and add future shows. But the freemium content and offerings can help monetize the loyalty.
Independence has been a career goal for Joe Budden. He’s now been through two lifecycles as a creator. From Def Jam to Shady Records to independent rapper, from Complex, to Spotify, to independent podcaster on Patreon. The ultimate test of this next move is whether Patreon’s top creators—especially the few who are responsible for a majority of the company’s revenue, will get paid when the company goes public.
Read more about Joe Budden + Patreon in the company’s blog post.
Podcast with J. Erving, founder of Human Re-Sources – drops later this week! I was originally going to run it last week but had to make a scheduling change. Coming soon!