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Does TikTok Promote or Cannibalize Music Streaming? Estimands and Identification with Heavy-Tailed Outcomes

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Listed:
  • Daniel Winkler
  • Christian Hotz-Behofsits
  • Nils Wlomert
  • Dominik Papies
  • J=ura Liaukonyt.e

Abstract

We study how TikTok affects demand for music on paid streaming platforms. We use Universal Music Group's (UMG) global withdrawal of its catalog from TikTok as a quasi-natural experiment. Recent work using this setting reaches mixed conclusions about whether TikTok promotes or cannibalizes streaming demand. We show that these findings can be reconciled by making the estimand explicit: with heavy-tailed exposure and outcomes, common difference-in-differences (DiD) implementations in levels, logs, and Poisson answer different economic questions. In our data, the top 10% of songs account for 96% of TikTok creations and 76% of Spotify streams, which makes the distinction between the typical song and the economically consequential song central. We find that removing TikTok access lowers Spotify demand for UMG titles, with losses concentrated among viral songs and little economically meaningful change for the long tail. Because the viral head accounts for a disproportionate share of listening and revenue, these losses drive aggregate implications. A TikTok creator-side analysis shows that some activity reallocates toward non-UMG audio when UMG content is unavailable. This substitution is limited in magnitude but economically relevant for interpreting the treatment effect because streaming compensation depends on relative stream shares. Finally, using the 2025 U.S. TikTok outage, which affected all labels symmetrically and is not subject to the label-specific spillover concern as the UMG withdrawal, we find corroborating evidence that disruptions to TikTok access reduce monetized streaming. We also provide a practitioner companion that guides the choice of DiD estimands, estimators, and diagnostics in heavy-tailed outcome settings.

Suggested Citation

  • Daniel Winkler & Christian Hotz-Behofsits & Nils Wlomert & Dominik Papies & J=ura Liaukonyt.e, 2024. "Does TikTok Promote or Cannibalize Music Streaming? Estimands and Identification with Heavy-Tailed Outcomes," Papers 2405.14999, arXiv.org, revised May 2026.
  • Handle: RePEc:arx:papers:2405.14999
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    1. Luis Aguiar & Joel Waldfogel, 2021. "Platforms, Power, and Promotion: Evidence from Spotify Playlists," Journal of Industrial Economics, Wiley Blackwell, vol. 69(3), pages 653-691, September.
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    3. Tobias Kretschmer & Christian Peukert, 2020. "Video Killed the Radio Star? Online Music Videos and Recorded Music Sales," Information Systems Research, INFORMS, vol. 31(3), pages 776-800, September.
    4. Scott Hiller, R., 2016. "Sales displacement and streaming music: Evidence from YouTube," Information Economics and Policy, Elsevier, vol. 34(C), pages 16-26.
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