Use the sharing options by clicking the share icon on the side or top of each article. FT.com’s terms and conditions and copyright policy are broken when articles are copied for distribution. Send an email to [email protected] to purchase more rights. With the gift article service, subscribers may share up to 10 or 20 articles each month. You may find out more at https://www.ft.com/tour.The content is 5948ea26-17eb-4408-ac47-8f38961b62ae.As the first artist to do so since the Grammy Awards were established in the 1950s, Taylor Swift made history on Sunday by taking home the highly sought-after album of the year award, surpassing musical greats like Frank Sinatra.

Notwithstanding her commercial and cultural achievements, the music industry appears to be much less confident this year.

This week, Swift was already the talk of Los Angeles, as the greatest names in music—executives and performers alike—gathered for events leading up to the biggest night in the business. The Grammy Awards have commercial ramifications in addition to the glamour and red carpets of the ceremony. Winning artists typically receive increases in sales and streaming as well as increased negotiating power for future contracts.

Swift was named the most powerful person in the industry by Billboard, a title usually awarded to male executives. Swift’s sales last year accounted for an estimated 2% of the US music industry, more than the whole jazz or classical music category.

On Wednesday night, Swift, 34, surprised everyone in the room by defeating everyone in her own label, Universal Music CEO Lucian Grainge, who was demoted to the number two spot in Billboard’s rankings. The very competitive Grainge joked, “I’ve never, ever in my entire career been so thrilled to be number two on a list.”

However, Swift’s achievement is an exception rather than a sign of things to come for the company as a whole.

Swift is tied to Universal, the industry titan, which plans to fire hundreds of employees in the upcoming weeks. According to those familiar with the situation, the corporation is not hosting its yearly pre-Grammys artist showcase, which is usually a lavish affair, for concern that it will come out as unsympathetic in the midst of the downsizing.

After years of explosive expansion, the CEO of a major music company referred to the current state of affairs in Los Angeles as “a hangover.” The CEO declared, “We’re in a different phase now.” “Let’s be honest.”

Numerous other music corporations have also been reducing employment, most notably Spotify, the streaming service that let go of almost 2,000 employees in the previous year. In March of last year, Warner Music took off about 270 employees, or roughly 4% of its workforce, and publisher BMG fired off about 40 employees in October.

While the music industry is still expanding, it is doing so more slowly than it did in years past, when streaming was in a different stage of development. The nine months ended September 30, 2023, saw a 7% increase in Universal’s revenue year over year. By contrast, during the same period in 2022, its sales growth was 24%. Similar slowdowns are being experienced by other musical groups.

In the meantime, concerns about AI have taken over the music industry in recent months, and Universal and TikTok, two major players in the market, are engaged in a full-scale financial battle. This week, Universal made the bold decision to remove its music from TikTok following the breakdown of contentious licensing discussions.

The extent to which the two corporations’ relationship has degenerated is evident from their recent public back-and-forth. TikTok called Universal’s action “self-serving” and “greedy,” while Universal charged the Chinese social media platform with “bullying.”

Swift’s music was routinely taken down and muted on TikTok starting on Thursday, along with tracks by ABBA, Drake, Ariana Grande, Lana Del Rey, Olivia Rodrigo, and other stars from Universal. As a last resort, fans are now employing renditions of their favorite songs as the background music for their TikTok videos.

Breakout sensation Noah Kahan, who is up for a Grammy Award for “Best New Artist,” expressed concern over his label’s choice. “I will no longer be able to use TikTok to market my songs.I’m sure I’ll be alright, right? “, he wrote on the app. “You think I’ll land on my feet? Correct?