TikTok -- the hugely popular mobile video app with more than 1 billion users -- has been taking its first steps to break into a new screen, the TV screen, launching and integrating a new app called TikTok TV first with Amazon Fire TV, and then Google TV and other Android TV OS devices, LG Smart TVs, and Samsung Smart TVs. Today comes news of another front in that strategy: TikTok has inked a partnership with Atmosphere, the startup that provides licensed and curated streamed video content for commercial venues like Westin, Taco Bell and Texas Roadhouse, as well as doctors' offices, gyms and other venues where people spend dwelling time.
Initially, the partnership will see Atmosphere develop a new channel on its platform dedicated to curated TikTok videos. It will be the first time that TikTok content is being used for an out-of-home video service.
“TikTok has become a destination for more than a billion people to be entertained, get inspired, and find community,” said Dan Page, head of global business development, new screens at TikTok, in a statement. “By partnering with Atmosphere, we’re excited to make it easy for people to experience TikTok together by bringing the joy and creativity of our platform to new screens, venues, and audiences.”
Atmosphere has been using the CES tech event to announce a series of milestones. Earlier this week, it revealed that it had raised $100 million on the back of very strong growth in the last year: it doubled the number of venues using its ad-supported streaming services to 19,000, covering some 20 million monthly unique users.
Although Atmosphere already repurposes content from platforms like YouTube in channels that it builds, this will be the company's first channel dedicated to a single social media brand. Leo Resig, the co-founder and CEO of Atmosphere, said his company and TikTok have been working on this deal and how the channel would look for eight months.
"They are the largest internet social media platform right now, and so they are very particular about how their brand and content are distributed," he said. "But they see the power of our platform."
To be clear, TikTok has confirmed to TechCrunch that the Atmosphere partnership is not another outlet for, or a repurposing of, TikTok TV, as TikTok's consumer-focused TV app is called. Instead, it's an example of how, as TikTok continues to mature, it's diversifying in how to reach new audiences, and build different revenue streams to complement advertising and other revenue models in its main app.
In this case, a team of people from Atmosphere will have access to a library of TikTok content, from which they will select videos they believe might work well on an Atmosphere channel. The team then connects with the individual creator to get the okay to use the video, and to work out how to credit said creator. Atmosphere then strips out all the audio, overlays it with its own optional audio (or none at all -- many of the venues that are Atmosphere customers use the service on mute by default), adds its own captions, and collates all that into its own video stream. The commercial arrangement in this deal is between TikTok and Atmosphere, which will run ads in the channel. That is to say, creators themselves -- at least for now -- do not get paid.
The financial details are not being disclosed but generally it sounds like content providers are paid, and Atmosphere makes its revenues from the advertising it runs alongside the content. As as for a basic guideline on payouts to providers, Resig said that currently the company pays "low millions of dollars per year" to content creators, but, he added, "We get most of our content for free," instead giving creators attribution to help them grow their audiences and brands. TikTok is not an investor in Atmosphere, the startup pointed out (it said that avoiding confusion is why it chose to separate its funding news from the TikTok news).
From what we understand, Atmosphere will be able to access a selection of TikTok videos -- tens of thousands of videos -- rather than the much bigger catalogue.
For a first foray into partnering with a social media company to bring content from that platform to Atmosphere, TikTok is something of a bullseye for the startup. TikTok was already looking for more opportunities to expand to a wider variety of screens (and specifically TV screens), and this gives it an opportunity to repurpose and give new life to the long tail of its back catalogue of videos that might no longer get picked up for viewing via TikTok's algorithms on its main app. On top of that, TikTok already had some parallels with Atmosphere in terms of how the two are being used, starting with audio consumption.
Atmosphere's Resig told TechCrunch that more than 99% of its customers were already streaming its services with the sound off, which led the company to building out more content with the audio removed altogether. TikTok, as it happens, also has an audience that consumes videos on its platform with the sound off, so much so that TikTok has built its own captioning technology to let creators on the platform either add their own words as graphics or use TikTok's AI to do this for them. Resig said that in the initial integration, the videos that Atmosphere will be curating from TikTok are not necessarily going to be these, and it will be overlaying its own captioning around them for TikTok's Atmosphere channel.
TikTok last year scored a notable point during the US Olympics, where it carved out a place for itself not as a destination for official Olympic event streams, or even official clips (these could be found on there from official accounts, yet they were elsewhere, too); but as a place for user-generated content from people on the ground -- athletes, audience, others involved in the Olympics -- that was either a complement to the official coverage, or sometimes (such as with the news of Simone Biles facing challenges in her exercises) ahead of it altogether.
Atmosphere also has carved out a place for itself in providing sports content that is complementary to what a bar or other venue might already be showing. In fact, so far it has eschewed trying to provide its customers with a direct replacement for premium sports channels, which comprise some of the most popular content that they broadcast in their venues, bringing in customers and often the driver for a venue paying a premium for a commercial pay-TV subscription in the first place. These days, an Atmosphere customer -- such as a bar -- that has TVs installed broadcasting sports on them will continue doing so even as they bring in Atmosphere on other TVs.
"Right now, we coexist with sports," Resig said, noting that on average, Atmosphere will be on 25% of a venue's screens, with the other TVs broadcasting more traditional content. "We don't want to be on every screen."
That's slowly changing. As Atmosphere scales, it is starting to have more conversations with sports media organizations -- the companies that broadcast and manage the rights for teams, leagues, and so on -- and is now thinking more about what shape Atmosphere premium sports content might take. Interestingly, it seems like this is precisely the place with TikTok is with sports, too.
This is just an early and first move into a partnership between the two. If it clicks, down the line there may also be more questions about how it will evolve as a business relationship. Right now, Resig confirmed that the commercial relationship it has here is with TikTok, not the creators on the platform, who are not being paid individually. Their compensation, such as it is, is currently coming in the form of promoting the creators and providing links to find them elsewhere.
One option down the line might be if creators one day start to build content specifically for TV rather than mobile formats. This would make some sense, considering how many of the videos now appear in awkward formats that need large areas of blurring on either side of the action to fill out the space on the horizontal TV screen.
"Will creators create content specifically for TikTok's TV activities in the future? Absolutely," predicted Resig. "Once it becomes ubiquitous those who create content will see value in the native app, and separately the TV format." He said this is not something being discussed right now, but with any platform, "you know you’ve made it when people are creating content specific for that platform."