Major Labels in Licensing Talks With A.I. Companies Suno & Udio Amid Blockbuster Lawsuit
Written by djfrosty on June 2, 2025
Universal Music, Warner Music and Sony Music are in talks with Udio and Suno to license their music to the artificial intelligence startups, Billboard has confirmed, in deals that could help settle blockbuster lawsuits over AI music.
A year after the labels filed billion-dollar copyright cases against Udio and Suno, all three majors are discussing deals in which they would collect fees and receive equity in return for allowing the startups to use music to train their AI models, according to sources with knowledge of the talks. Bloomberg first reported the news on Sunday (June 1).
If reached, such deals would help settle the litigation and establish an influential precedent for how AI companies pay artists and music companies going forward, according to the sources, who requested anonymity to discuss the talks freely.
Trending on Billboard
Such an agreement would mark an abrupt end to a dispute that each side has framed as an existential clash over the future of music. The labels say the startups have stolen music on an “unimaginable scale” to build their models and are “trampling the rights of copyright owners”; Suno and Udio argue back that the music giants are abusing intellectual property to crush upstart competition from firms they see as a “threat to their market share.”
Settlement talks are a common and continuous feature of almost any litigation and do not necessarily indicate that any kind of deal is imminent. It’s unclear how advanced such negotiations are, or what exactly each side would be getting. And striking an actual deal will require sorting out many complex and novel issues relating to brand-new technologies and business models.
Reps for all three majors declined to comment. Suno and Udio did not immediately return requests for comment. A rep for the RIAA, which helped coordinate the lawsuits, declined to comment.
If Suno and Udio do grant equity to the majors in an eventual settlement, it will call to mind the deals struck by Spotify in the late 2000s, in which the upstart technology company gave the music industry a partial ownership stake in return for business-critical content. Those deals turned out to be massively lucrative for the labels and helped Spotify grow into a streaming behemoth.
The cases against Udio and Suno are two of many lawsuits filed against AI firms by book authors, visual artists, newspaper publishers and other creative industries, who have argued AI companies are violating copyrights on a massive scale by using copyrighted works to train their models. AI firms argue that it’s legal fair use, transforming all those old works into “outputs” that are entirely new.
That trillion-dollar question remains unanswered in the courts, where many of the lawsuits, including those against Suno and Udio, are still in the earliest stages. But last month, the U.S. Copyright Office came out against the AI firms, releasing a report that said training was likely not fair use.
“Making commercial use of vast troves of copyrighted works to produce expressive content that competes with them in existing markets, especially where this is accomplished through illegal access, goes beyond established fair use boundaries,” the office wrote in the report.
Even with the legal landscape unsettled, some content companies have struck deals with AI firms. Just last week, the New York Times — which is actively litigating one of the copyright cases — struck a deal to license its editorial content to Amazon for AI training. Last fall, Microsoft signed a deal with HarperCollins to use the book publisher’s nonfiction works for AI model training.
Music companies have not struck any such sweeping deals, and instead have preferred more limited partnerships with tech companies for “ethical” AI tools. UMG signed a deal last summer with SoundLabs for an AI-powered voice tool for artists and another one in November with an AI music company called KLAY. Sony made an early-stage investment in March in a licensed AI platform called Vermillio.