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Source: Netflix / Netflix Games
Netflix continues its push to plant itself in the video games market firmly and is now testing its service on more devices.
Two years after the movie streaming giant announced its video games-driven initiative by launching mobile games on its service, Netflix says in a blog post that it will begin testing the service on TVs, PCs, and Macs.
“Our goal has always been to have a game for everyone, and we are working hard to meet members where they are with an accessible, smooth, and ubiquitous service. Today, we’re taking the first step in making games playable on every device where our members enjoy Netflix — TVs, computers, and mobile,” Netflix’s VP of Games, Mike Verdu, said in a blog post.
The blog post also notes that a limited beta test began rolling out to a small number of members in Canada and the UK on August 14 and on PCs and Macs through Netflix.com through supported browsers.
Two Games Will Be Available For Users To Test The Service
As for the games that will be available to play, Verdu says users will be able to play now Netflix Game Studio owned, Night School Studio’s Oxenfree, and Molehew’s Mining Adventure, which the streaming service describes as a “gem-mining arcade game.”
Users can use their smartphones as controllers when playing on TVs, while PC and Mac users can utilize their mouse and keyboards.
Verdu says the beta will serve as the steaming service’s way to work out the kinks as it continues to test its service and controller while improving the member experience.
Verdu notes the company’s initial partners, Amazon Fire TV Streaming Media Players, Chromecast with Google TV, LG TVs, Nvidia Shield TV, Roku devices and TVs, Samsung Smart TVs, and Walmart ONN will all have devices that Games on TV will work on. New devices will be added, “on an ongoing basis.”
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Photo: Netflix / Netflix Games
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Source: Activision / Sledgehammer Games / Call of Duty: Modern Warfare III
The next installment in the rebooted Call of Duty: Modern Warfare franchise has a date, and now we know how much it will cost.
Activision is slowly prepping COD fans for Call of Duty: Modern Warfare III with teases of the title and recently a reveal trailer teasing the return of notorious villain Makarov and Verdansk location. Insider Gaming reports that Modern Warfare III will also be a premium $70 release when it launches, throwing cold water on the idea that the game will be on a DLC add-on for 2022’s Modern Warfare II.
[embedded content]
Notable Call of Duty reporter, CharlieIntel, confirmed the news from Activision that game will be a premium $70 release.
Per CharlieIntel:
Activision has confirmed that Modern Warfare III is a full premium release and will be priced at $70. There is no upgrade price, and it’s not an expansion. “As stated in numerous Activision Blizzard quarterly conference calls, Modern Warfare III is a premium release. It will be price accordingly at $70 USD,” an Activision spokesperson tells CharlieIntel.
In a follow-up post on X, formerly known as Twitter, CharlieIntel explained why Modern Warfare III is listed as an add-on on Steam, and that is due to all Call of Duty games being added to the Call of Duy HQ app.
Is Call of Duty’s Annual Release Strategy Here To Stay?
Activision’s current plans with Call of Duty are a deviation from the rumored strategy change in releasing Call of Duty games. In January 2022, there were rumblings that Activision would ditch the annual release model for the game after Call of Duty: Vanguard flopped.
It appears following the success of Modern Warfare II, Activision hit the pause button on that strategy and is still sticking with its annual release strategy with the Modern Warfare III coming on November 10.
We will have to see what Activision and Sledgehammer will have in store for us in just two days when the MWIII reveal goes down.
Keep it locked on HHW Gaming for all news on Modern Warfare III.
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Photo: Activision / Sledgehammer Games / Call of Duty: Modern Warfare III
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All products and services featured are independently chosen by editors. However, Billboard may receive a commission on orders placed through its retail links, and the retailer may receive certain auditable data for accounting purposes. If you work from home and/or are an avid gamer, the tech you use can impact how you get your work […]
As artificial intelligence remains the hottest topic of 2022, last month President Biden stood alongside big tech leaders as they pledged impotent “voluntary commitments” to control the emerging technology. Those leaders did so fully comprehending the dangers posed by the rapid and unrestricted penetration of AI through society — which are especially grave for artists and creators.
None of the commitments can give anyone in the music or creative industries comfort. They are as basic and malleable as “prioritizing research” and “sharing information on managing AI risks.” It is impossible to monitor big tech’s compliance with them. Even worse, all of the commitments are unenforceable.
We are already experiencing the consequences of the unbridled development and use of AI. Copyrighted material is being routinely ingested and used by AI conglomerates without the consent or even knowledge of rights holders. AI-generated vocals and deepfakes — given prominence by the Fake Drake and The Weeknd’s “Heart On My Sleeve” saga — are prevalent and becoming more realistic by the day. “Artificial streaming” — whereby AI bots create and upload songs, and then artificially inflate streaming numbers — is a massive issue for the streaming industry. Misinformation and inaccuracies in AI output are rampant. Generative AI programs suffer from what experts call “hallucination” — where they make up or misrepresent facts. The victims are widespread, ranging from lawyers given fake legal cases to cite in court papers, to a professor named as the accused in a sexual harassment scandal fabricated by AI.
Nicholas Saady
The lacuna of AI regulation and long wait for decisions in significant AI court cases leaves rights holders, and broader society, at the mercy of big tech. That includes the protagonists of the 2016 Cambridge Analytica scandal (where there were laws in place prohibiting such misconduct), Frances Haugen’s 2021 revelations about Facebook and its platforms’ impact on issues such as teen health and even human trafficking, as well as those being investigated by the FTC for engaging in unfair or deceptive practices causing harm to consumers. Some in this group have recently shown immense hostility to lawmakers, and threatened to leave the EU if it regulates AI. None are those whose history or current actions compel public trust.
We also have minimal, if any — a point recently illustrated by the California Stability AI lawsuit, in which key issues are copyright infringement and data scraping — transparency around the ingestion and scraping of data by companies that own generative AI. Content and data protections were not formulated with current forms of AI in mind. Nor were copyright and right of publicity laws. It is unclear whether they provide sufficient protections, and in any case, are difficult to enforce amidst the black box of AI data ingestion.
Draconian regulation is not the answer to these issues. Nor is inaction. Congress has been exceptionally slow to move. While some lawmakers have proposed legislation, held a few congressional hearings, and suggested new federal agencies to deal with AI, nothing meaningful has resulted. The significant AI litigation is also not progressing quickly. Recently, a Federal Judge indicated that he was inclined to dismiss the California Stability AI lawsuit, but would give the plaintiffs a chance to reformulate their case. This means any decision or guidance is unlikely this year. Similar court cases will not provide definitive guidance soon, and many may settle. Even if decisions are released, they will not be universally applicable.
U.S. Congress’ inaction starkly contrasts the European Union’s continued development of its “AI Act,” which includes important guardrails for the use of AI. For generative AI such as ChatGPT, the AI Act requires disclosure of content generated by AI; prohibitions on the ability to generate illegal content; and publication of copyrighted data used for training. It also prohibits real-time and remote biometric identification systems and cognitive behavioral manipulation using AI. While the final form of the Act is being negotiated, the EU hopes to “reach an agreement by the end” of 2023.
However, the EU AI Act is not a panacea — especially not for artists and creators, as music industry organizations like GESAC, ICMP, IFPI, IMPALA and IMPF recently pointed out to the EU. To properly protect human creativity and rights in creative output, more can be done to increase transparency regarding the data on which AI is trained and record keeping of the same — particularly content which is protected by registered copyrights. Such publicly accessible information will enable artists and creators to determine if their content has been ingested by AI, and also to make fully informed assessments as to whether AI outputs constitute infringement or fair use of their content. Stronger protections around the use of video and audio deepfakes and digital recreations of humans, particularly celebrities, are becoming an increasing priority to protect privacy, creativity and livelihoods.
The stakes are too high for a wait and see approach. We saw what happened when that approach was employed with cryptocurrency: FTX and other similar debacles. The potential impact of generative AI is greater because of its universal application and almost limitless potential. As history and the cacophony of current AI lawsuits make clear, big tech has little regard for the intellectual property, livelihoods and creativity of artists and creators, nor for individuals’ privacy and personal information.
The recent “voluntary commitments” won’t change a thing. Congress should take swift action. It has a unique opportunity to lead the world in AI regulation by passing an enhanced version of the EU AI Act. The risks of inaction amidst the rapid development and use of generative AI — like AI’s capabilities — are in many respects, existentially threatening.
Nicholas Saady is a U.S. and Australian lawyer, who represents high-profile organizations and individuals — including major artists, labels and agents — regarding complex intellectual property, technology and commercial matters. He has also published widely on issues relating to technology, AI, NFTs and cryptocurrency.
Futureverse — a multi-hyphenate AI company — published a new research paper on Thursday (June 9) to introduce its forthcoming text-to-music generator. Called Jen-1, the unreleased model is designed to improve upon issues found in currently available music generators like Google’s MusicLM, providing higher fidelity audio and longer, more complex musical works than what is on the market today.
“Jen is spelled J-E-N because she’s designed to be your friend who goes into the studio with you. She’s a tool,” says Shara Senderoff, co-founder of Futureverse and co-founder of Raised in Space, about the model in an exclusive first-look with Billboard. Predicted to release in early 2024, Jen can form up-to three minute songs as well as help producers with half-written songs through offering ‘continuation’ and ‘in-painting’ as well.
‘Continuation’ allows a music maker to upload an incomplete song to Jen and direct the model to create a plausible idea of how to finish the song, and ‘in-painting’ refers to a process by which the model can fill in spaces of a song that are damaged or incomplete in the middle of the work. To Aaron McDonald, the company’s co-founder, Jen’s role is to “extend creativity” of human artists.
When asked why Jen is a necessary invention during a time in which producers, songwriters and artists are more bountiful than ever, McDonald replied, “I think musicians throughout the ages have always embraced new technology that expands the way they can create music,” pointing to electronic music as one example of how new tools shape musical evolution. “To imply that music doesn’t need [any new] technology to expand and become better now is kind of silly… and arbitrary.”
He also sees this as a way to “democratize” the “high end of music [quality],” which he says is now only accessible to musicians with the means to record at a well-equipped studio and with trained technicians. With Jen, Johnson and Senderoff hope to satisfy the interests of professional musicians and to encourage newcomers to dabble in songwriting, perhaps for the first time. The two co-founders imagine a world in which everyday people can create music, and have nicknamed the products of this type of user as ‘AIGC,’ a twist on the term User Generated Content (or ‘UGC’).
Futureverse was formed piecemeal over the last 18 months, merging eleven different pre-existing AI and metaverse start-ups together into one company to make a number of creative AI models, including those that produce animations, music, sound effects and more. To power their inventions, the company employs the AI protocol from Altered State Machine, a company that was founded by Johnson and included in the merger.
Senderoff says Jen will also be a superior product because Futureverse created it with the input of some of music’s top business executives and creators, unlike its competitors. Though Senderoff does not reveal who the industry partners are or how Jen will be a more ethical and cooperative model for musicians, but she assures an announcement will be released soon providing more information.
Despite its proposed upgrades, Futureverse’s Jen could face significant challenges from other text-to-music generators named in the new research paper, given some were made by the world’s most established tech giants and have already hit the market, but McDonald is unperturbed. “That forces us to think differently. We don’t have the resources that they do, but we started our process with that in mind. I think we can beat them with a different approach: the key insight is working with the music industry as a way to produce a better product.”
Universal Music Group is in the early stages of talks with Google about licensing artists’ voices for songs created by artificial intelligence, according to The Financial Times. Warner Music Group has also discussed this possibility, The Financial Times reported.
Advances in artificial-intelligence-driven technology have made it relatively easy for a producer sitting at home to create a song involving a convincing facsimile of a superstar’s voice — without that artist’s permission. Hip-hop super-fans have been using the technology to flesh out unfinished leaks of songs from their favorite rappers.
One track in particular grabbed the industry’s attention in March: “Heart On My Sleeve,” which masqueraded as a new collaboration between Drake and the Weeknd. At the time, a Universal Music spokesperson issued a statement saying that “stakeholders in the music ecosystem” have to choose “which side of history… to be on: the side of artists, fans and human creative expression, or on the side of deep fakes, fraud and denying artists their due compensation.”
“In our conversations with the labels, we heard that the artists are really pissed about this stuff,” Geraldo Ramos, co-founder and CEO of the music technology company Moises, told Billboard recently. (Moises has developed its own AI-driven voice-cloning technology, along with the technology to detect whether a song clones someone else’s voice.) “How do you protect that artist if you’re a label?” added Matt Henninger, Moises’ vp of sales and business development.
The answer is probably licensing: Develop a system in which artists who are fine with having their voices cloned clear those rights — in exchange for some sort of compensation — while those acts who are uncomfortable with being replicated by technology can opt out. Just as there is a legal framework in place that allows producers to sample 1970s soul, for example, by clearing both the master and publishing rights, in theory there could be some sort of framework through which producers obtain permission to clone a superstar’s voice.
AI-driven technology could “enable fans to pay their heroes the ultimate compliment through a new level of user-driven content,” Warner CEO Robert Kyncl told financial analysts this week. (“There are some [artists] that may not like it,” he continued, “and that’s totally fine.”)
On the same investor call, Kyncl also singled out “one of the first official and professionally AI-generated songs featuring a deceased artist, which came through our ADA Latin division:” A new Pedro Capmany track featuring AI-generated vocals from his father Jose, who died in 2001. “After analyzing hundreds of hours of interviews, acappellas, recorded songs, and live performances from Jose’s career, every nuance and pattern of his voice was modeled using AI and machine learning,” Kyncl explained.
After the music industry’s initial wave of alarm about AI, the conversation has shifted, according to Henninger. With widely accessible voice-cloning technology available, labels can’t really stop civilians from making fake songs accurately mimicking their artists’ vocals. But maybe there’s a way they can make money from all the replicants.
Henninger is starting to hearing different questions around the music industry. “How can [AI] be additive?” he asks. “How can it help revenue? How can it build someone’s brand?”
Reps for Universal and Warner did not respond to requests for comment.
The music industry has progressed rapidly over the last decade. TikTok is launching music careers, sites like YouTube are creating new distribution channels and artists like Grimes are open-sourcing their vocals for generative AI creation. But for all of that progress, the opaque systems that control the industry are not in favor of artists driving culture. As listeners, we’ve seen the tip of the iceberg with Taylor Swift’s highly publicized re-recording of her masters and Megan Thee Stallion’s legal dispute with her record label over unpaid royalties.
Music is the most consumed category of art on the planet, and it’s time to evolve the system so that all artists — from top recording stars to indie creators to those who are just getting their careers started — are set up to succeed. But to really grasp what’s needed to shift the power dynamic in the direction of artists, it’s important to peel back the complexities of music revenue.
Changing the narrative on music revenue
There’s a false narrative that is pervasive in the media that says music doesn’t generate any money, driven in large part by the litany of really bad record deals that draw public attention (like the aforementioned Megan Thee Stallion example). But in reality, music makes money — it’s the artists who don’t get paid what they deserve.
The streaming revolution of the 21st century has transformed the way people consume music. But despite streams making up 80-90% of the industry’s revenue, artists see few of those dollars after industry players take their inevitable cuts. Though record labels serve a valuable role in the music ecosystem (from marketing and developing an artist to licensing and distribution), artists can be haunted for decades by bad deals signed early in their careers that unknowingly give away creative control and a significant portion of their future earnings. Artists who have signed contracts with unfavorable terms typically don’t earn negotiating power until they’ve amassed a large following and a fruitful career.
Why the bad deals?
Most artists simply don’t know what they’re signing — it’s not necessarily that they’re making a bad decision. As an artist myself, I experienced this firsthand early in my career. It would take years for me to get paid for my songs — and as someone who’s proficient in accounting from my time studying business in college, my inability to see how much I made from my music was mind-boggling.
The reason that deals are so opaque is that music revenue is growing and coming from more sources than ever before, which creates a complex web of intermediaries within the ecosystem. Every different distributor has a different deal with every different streaming service, and every label has a different deal with every streaming service. And the streaming services are not transparent about how their rates differ across these various deals. Beyond that, there are numerous types of royalties — from performance royalties to mechanical royalties to in-app streaming royalties. Therefore, when it comes to signing on the dotted line, artists must blindly place their trust in a network of counterparties, lacking any real visibility into their actual earnings once every entity has taken their cut. All of this is perpetuated because record labels are incentivized to control information so they can make more competitive deals with artists.
As a result, artists gravitate to what comes naturally — the music. They don’t want to worry about the business side of things because the system isn’t set up in a way that empowers them to ask questions or negotiate favorable deals, and it distracts them from doing what they love.
Finding the opportunity in technology
To rewrite the way music institutions approach music revenue and income, we need to make it as transparent as possible. It seems like a lofty goal for an industry that has long been set in its ways, but technology is making it possible. My company Royal recently launched a free tool that allows any artist to estimate the streaming revenue for their songs. The hope is that artists become more empowered to make deals that uplift their careers.
I’ve also been bullish on crypto since its earliest days, for a variety of reasons, including its ability to transform the music industry with transparency. Blockchain is inherently transparent — in fact, the one thing you can’t do on a blockchain is hide information. It’s all there, at all times. It’s also time-stamped which establishes a clear provenance (traceability of ownership over time). This is especially useful in the music business, where copyright infringement plagues artists and record labels alike. Perhaps most importantly, leveraging tokens that represent rights enables artists to see the value of their songs and create tangible benchmarks upon which to negotiate better deals. With more information always comes more power.
Artists don’t know how much money they’re missing out on, but they could. And it doesn’t have to be a public battle when they do find out. If we embrace technological progress to improve outdated systems, we can create an open data ecosystem that gives artists not only more transparency into their earnings and fan bases but more control over their artistic careers. Better deals alongside more creative freedoms is a winning combination that can define the next 30 years of music — we just have to be willing to change.
Why should artists even care?
As much as streaming has changed the music industry for the better, there are still unanswered questions about how value accrues in this system. Do we equate the value of passively listening to a sleep playlist in the background to actively listening to your favorite album with friends?
This talk of numbers and questions of value may seem like a distraction for artists who just want to spend their time making music — but ignoring this topic completely opens the door to predatory industry practices that threaten musicians’ longevity and entire legacies.
More industry transparency should improve all the variables that play into an artist’s career and result in musicians keeping more ownership of the art they create. Having the humility to acknowledge what music is actually worth is the first step in unlocking more value in this new era of the industry.
Justin Blau is CEO of Royal and a world-renowned musician and producer, known as 3LAU. An early crypto adopter, Justin has been advocating for building the investable layer of music on blockchains since 2017. In 2021, he founded Royal to empower artists to share their music with fans and give people the opportunity to invest in music.
“Fake Drake” and similar controversies have gotten most of the attention, but not all uses of artificial intelligence in music are cause for concern.
The clock is ticking. Two weeks ago, TikTok announced the launch of the beta for its new streaming service in three new markets – Mexico, Australia, and Singapore – just a few weeks after it shared plans to roll out the app in Brazil and Indonesia. This suggests that the social media giant might also soon bring TikTok Music to the United States – although a source close to the matter claims TikTok has “no current plans” to do so.
However, if it does, TikTok Music could push the industry into a new, second generation of music streaming fueled by social media – and make ByteDance one of the most powerful and vertically integrated companies in the modern music business.
TikTok teased in a recent press release that TikTok Music will provide a “social music streaming” experience. Though it remains to be seen what the U.S. version of the forthcoming service will look like, a move to prioritize social interaction and cross pollination between the TikTok social app and its music streaming counterpart plays on the company’s greatest asset – and arguably also targets the incumbents’ greatest weakness.
The streaming services could be more social. It’s hard to find any examples of a music influencer that grew their following primarily on Spotify, Apple or Amazon. There is no longer a direct messaging feature on Spotify. There are practically no ways to engage with music beyond adding it to your personal library or clicking a “heart” icon. Unless, of course, the user leaves the app and shares a song to an Instagram story.
Instead, the current streamers invested in company-selected editorial playlists and radio stations. This allowed them to gain control in the promotion and marketing of music in the late 2010s and early 2020s as the streaming market in the United States began to mature. Top curators and hosts employed at Spotify and Apple in particular – like Zane Lowe or Tuma Basa – became modern kingmakers, much like radio DJs, MTV VJs, journalists and bloggers had been before.
But Billboard found that by late 2022, this was no longer moving the needle quite like it did just a few years before. At the peak of this model in 2019, a few high placements on key playlists often guaranteed a drastic influx of streams and interest from record labels, but its potency has since waned considerably. “There used to be a world where an unknown artist would get the cover of the Fresh Finds playlist [on Spotify] and they would get between 60,000 and 100,000 streams a week,” said one manager who works primarily with developing acts. “Now you’re looking at more like 15,000 to 20,000 streams a week.”
Instead, listeners – particularly Gen Z – increasingly turned to TikTok to find their new favorite songs, likely for its more interactive and organic feel; and labels in turn began offering lucrative contracts to artists who fared well on TikTok in the same way that they once offered deals to talent who landed on key playlists. In the words of MIDiA Research’s Tatiana Cirisano, the streaming services “cultural capital” was giving way to the China-based company which had become the most important place to market and promote music. As Chris Anokute, an A&R rep-turned-manager, previously put it to Billboard, “The biggest game in town is TikTok.”
The move into streaming, if successful, will allow TikTok to not only wield power over the marketing and promotion of music, but also the consumption of it. This, coupled with its popular music distributor and artist services company SoundOn, has the potential to make the company the most powerful in the industry today. With distribution, promotion, marketing and consumption all vertically integrated, ByteDance becomes a one-stop shop. (To take it even further, ByteDance also recently launched a music AI tool called Ripple, also inching the company into the music production process too).
SoundOn already has certain advantages over competitors like AWAL, Virgin and The Orchard: It can leverage access to TikTok data that lets signees identify promotional opportunities within the app. It can also afford to be a loss-leader, given that music is not ByteDance’s primary source of revenue. If SoundOn could add in the promise of editorial playlisting on a popular streaming service, it would be an even more formidable challenger for its competition. Today, traditional artist services companies cannot guarantee playlisting on any platform – all they offer is that their team will try. Imagine if an artist services company could guarantee social media success and playlisting for an emerging artist.
In many ways, TikTok’s democratization of music discovery is an exciting thing in that it has allowed artists without industry connections a chance to build an audience. But this comes at a cost. Today’s gatekeeper is not a music professional, it is an elusive, ever-changing algorithm, created by a company already criticized for its lack of transparency. In January, Forbes discovered that TikTok employees have access to a private “heating button” that can be employed to induce an uptick in video plays, and in March, a coalition of lawmakers cited potential issues with data privacy as a reason to ban the app nationwide. (Since then, Congress has gone mostly quiet on the idea of a TikTok ban.)
The incumbent streamers still have the upper hand against TikTok Music given their robust user bases. Though video streamers like Netflix, Hulu, and MAX struggle with constant cord cutting as users hop from service-to-service depending on their current film and TV offerings, music streamers generally offer the same catalog. This builds user loyalty to their music services and could possibly insulate Spotify, Apple and Amazon from a shiny new opponent like TikTok Music, even if that opponent’s experience proves better in some ways.
TikTok, however, has already influenced the rollout of new features on streaming services before it entered the streaming business itself. Take, for example, Spotify’s announcement earlier this year of a new vertical, swipeable discovery feed that sparked comparisons to the short-form video app, or its prior recruitment of TikTok-based music influencers – like Ari Elkins and Dev Lemons – to help popularize its now-defunct live audio app, Spotify Live. So even if TikTok can’t launch a streaming service that clinches the top market share, it will certainly continue to influence its competition even more than it already has. At the very least, TikTok Music’s launch signals the start of “music streaming 2.0,” – if not an even more seismic shift in power in the overall business.
Triller, a short-form video app in the style of TikTok, is planning to sell its common stock on the New York Stock Exchange through a direct listing under the ticker “ILLR,” according to the company’s S-1 filing released Wednesday (Aug. 2). The filing did not provide a date of the direct listing.
The direct listing — not an initial public offering, or IPO — will not have an underwriter that assumes the financial risk of selling the listed shares to institutional investors. Popularized by Spotify in 2018, a direct listing avoids the IPO’s road show and book-building process that establishes an initial selling price. Triller will not receive any proceeds from shares offered in the direct listing by its shareholders.
While TikTok had an estimated $9.4 billion in revenue in 2022 and is becoming an important source of royalties for record labels and music publishers, Triller is a far smaller affair. In the first quarter of 2023, the self-described “artificial intelligence powered technology platform” had revenue of $9.1 million and a net loss of $28.8 million. In calendar 2022, Triller had a net loss of $195.6 million on revenue of $47.7 million.
The S-1 paints a picture of a financially troubled company with numerous outstanding issues. Triller had just $2.2 million of cash and cash equivalents as of March 31. The company’s S-1 warns that Triller has incurred losses each year since its inception — not unusual for a high-growth tech startup — and has an accumulated deficit of $1.29 billion. Triller may incur additional costs related to outstanding litigation with Universal Music Publishing Group, as one example, and admits to not being in compliance with the payment obligations of “a significant number” of its music licensing contracts and “overdue on payments” to vendors that provide Triller with engineering, marketing and legal services, among other parties.
The S-1 also reveals that Triller entered into a confidential settlement agreement with Sony Music Entertainment on July 21, 2023, that requires it to make payments to SME for a breach of contract lawsuit brought by SME in 2022. On May 16, Triller was ordered to pay SME nearly $4.6 million. The settlement provided Triller with a payment plan. With 15 days of the direct listing, Triller will be obligated to pay SME under the settlement agreement.
Triller will have two classes of common stock: a Class A common stock with one vote per share and Class B common stock with ten votes per share. Upon completion of the reorganization, Proxima Media and Bobby Sarnevesht, Triller’s founding partners, will own about 15.4% of Triller’s common stock and have 60.6% of the company’s total voting power. In addition to Proxima Media, the other shareholders with greater than a 5% share of outstanding common stock are Paul Posner, CEO of Carnegie Technologies, and Tsai Ming Hsing. As of March 31, Triller had 282,017,038 shares of Class A common stock and 46,651,382 shares of our Class B common stock outstanding.
Triller claims to have over 550 million user accounts and had over 2.4 million creators as of March 31 — almost 100,000 more than it had two years earlier. It built its user base with acquisitions such as its 2021 purchase of Verzuz, the livestream platform created by of Swizz Beats and Timbaland that shot to fame during the pandemic. Swizz Beatz and Timbaland filed a $28 million lawsuit against Triller in August 2022 over unpaid monies promised in the deal. That lawsuit was settled out of court one month later.