Record Labels

Amid the rapidly-shifting sands at the intersection of AI and music — which involves a whole lot of accusations on both sides, endless questions of ethics, and dozens of companies vying for attention and a share of the market — no story came to define the situation quite like the three major labels teaming up to sue AI music generation companies Suno and Udio for $500 million, alleging copyright infringement on “an unimaginable scale.” Without clear legal precedent on whether it was “fair use” for Suno and Udio to train their algorithmic models on unlicensed music, the two seemed to be digging in for a long, establishment-setting fight — only for Universal, then Warner, to settle with Udio in October, followed by Warner’s settlement with Suno the following month.

The result is changes to some of the parameters around how such music can be utilized outside of the companies’ platforms. On Udio, users can no longer take their creations outside the platform’s walled garden, and for Suno, there will be limits for paid subscribers and remuneration for artists and songwriters who opt in to having their music licensed to the platforms. There is still a long road ahead (and Sony hasn’t settled either case), but some clarity is beginning to emerge around AI and music from a major-label legal perspective.

For much of the past few years, the rise of AI has loomed as a specter over the music business: a technology that was certainly going to be disruptive, but that still existed largely in the abstract, as an issue that hadn’t been fully formulated. That changed this past year, when Hallwood Media won a multimillion-dollar bidding war to sign Xania Monet, the AI-assisted artist crafted by Mississippi creator Telisha Jones. Jones had written the lyrics to Monet’s songs, then used Suno to generate the music, building up a fan base and racking up enough streams, downloads and radio airplay to begin debuting on the Billboard charts. It’s a phenomenon that has only accelerated in recent weeks, as more and more AI-assisted artists and songwriters have made waves by debuting on the charts, albeit often on lower-stakes download sales tallies (though their actual popularity is thus far overblown).

It should be noted that Monet wasn’t the first AI-assisted artist signed by Hallwood, founded by former Interscope executive Neil Jacobson. Two months before that September deal, the company had signed the artist imoliver — a self-described “AI music designer” who also used Suno to craft his music — to a record deal that it touted as the first of its kind at the time. At the time of the Monet deal, Billboard reported that several major labels had been interested, only to back away after learning that the artist had used Suno, which all three majors were actively litigating against at the time. Now that some of those deals have settled, could they also be jumping into the AI-assisted artist world?

When Universal Music Group (UMG) announced that its Virgin Music Group division had reached an agreement to buy Downtown Music Holdings — which houses FUGA, CD Baby, Songtrust and more — for $775 million last December, it seemed another example of the long-running consolidation phase of the music business, with the majors looking to snap up smaller labels and especially distribution companies as a way to vacuum up market share in the growing indie space. What UMG perhaps did not fully anticipate was the level of blowback it would receive over the deal.

Coming amid that aforementioned consolidation — UMG had also acquired indie distributor and label group [PIAS] in October 2024 — several indie trade groups and labels objected strongly to the proposed deal, saying it would stifle competition, leave indies with few options to do business outside the majors’ purview, and open many of them up to the possibility that UMG could now see sensitive label data to which it would otherwise not be privy. The backlash, and related concerns about market power, sparked an antitrust review in the European Union, which ultimately issued some formal objections last month. While the proposed acquisition wends its way through the process, the sale remains up in the air — and the rancor over the deal shows few signs of going away, even if it is ultimately approved.

In April, Arista Records president David Massey announced he was retiring from the music business after an illustrious career that spanned more than 40 years, during which he led Mercury, Island and Arista at various points and headed up Epic’s A&R department and his own Daylight Records. After Massey officially left at the end of June, he took Billboard on a trip down memory lane, sharing stories of working with the likes of Oasis, Shawn Mendes, Shakira, the Jonas Brothers, Good Charlotte, Avicii, Demi Lovato, Maneskin and many more.

Later in the year, legendary executive Sylvia Rhone announced that she would be leaving Epic Records — where she first served as president, then as chair/CEO — after 11 years. Rhone did not announce her retirement, but her exit was an opportunity for many to assess a career that was nothing short of trailblazing and historic: Rhone was the first-ever woman to chair a major record company — East West Records, in 1990 — and then broke another glass ceiling by becoming the first Black woman appointed chair/CEO of a major record company, Elektra Entertainment Group, in 1994. After a decade in that role, Rhone became president of Universal Motown Records and chairman of Universal Motown Records Group in 2004, before eventually moving to Epic in 2014. Her accomplishments across her five-decade career — and the artists she helped nurture — are too many to count, and she may not be done just yet.

Over the past 13 months, all three heads of the major labels’ Nashville operations have turned over, ushering in a new era of leadership in the country music capital. The first came last November, when longtime Sony Nashville chief Randy Goodman retired, with Taylor Lindsey taking over as chair/CEO. Then in February, Cindy Mabe — who had spent less than two years as chair/CEO of Universal Music Nashville — was ousted and replaced by Mike Harris, who proceeded to rebrand the division as MCA. Then, last month, Warner Nashville co-president Cris Lacy was promoted to chair/president of the label, which was then rebranded as Warner Records Nashville, as her other co-president, Gregg Nadel, shifted into a broader A&R role at Warner Records.

But it wasn’t just the Nashville divisions retooling their leadership ranks. Several frontline coastal labels also continued their entry into Nashville with not just co-signings, as had been the recent trend, but with full-on imprints landing in the city. Most notably, Interscope relaunched its Lost Highway imprint under Robert Knotts and Jake Gear, signing Kacey Musgraves as its first artist; and Atlantic Music Group debuted Atlantic Outpost under Jeff Levin and Ian Cripps. Elsewhere, Warner Records Nashville was reorganized under the broader Warner Records banner. Whether through new leadership, new imprints or new initiatives, Nashville got a whole refresh this year — with more to come.

Three years into Robert Kyncl’s reign atop the Warner Music Group, he continued his overhaul of the label group: In July, he announced that the company would be executing a further round of layoffs and cost-cutting measures in an attempt to save $300 million, which it planned to reinvest in A&R across the company and mergers and acquisitions targets. But that wasn’t all Kyncl did this year: He also further implemented a new reporting structure that had begun the year prior, bringing Warner Nashville (rebranded as Warner Records Nashville) under the Warner Records Group purview; aligned the Warner UK and Atlantic UK leadership groups under their U.S. counterparts as part of of a trans-Atlantic decision-making apparatus, which led to Warner Music UK boss Tony Harlow’s departure; oversaw a new leadership structure at ADA, as Cat Kreidich left the company and oversight was handed to Warner Latin president Alejandro Duque; and formally moved 10K Projects under the Atlantic Music Group umbrella, among other moves.

While full-year revenues grew 4% in earnings released in late November, costs associated with some of that restructuring led to falling profits year over year. But as Kyncl said in his July memo announcing the cuts, his aim was to begin “future-proofing” the label at a time of seismic change.

While not unheard of, licensing deals — in which a label contracts a song or record for a set period of time, but does not command ownership of the recording — have now become the norm for artists at almost all stages of their careers. For decades, the majors in particular would demand lifetime ownership, a practice that is becoming rarer and rarer as artists gain more leverage in negotiations and more control over what is possible in their own careers. And while that’s changing the short-term economics of the label business — these days, artists can often command a 50% split, if not higher, from the beginning — it could have a much larger effect on the long-term economics for the majors, too, particularly as catalog (releases more than 18 months old) continues to command a larger slice of the business. It could make the bidding for superstar artist catalogs even more lucrative and ultimately erode market share as those catalogs change hands much more often than the those of generations past. But the ultimate impact is far from certain.

It seems like every few years the industry gets jolted by a new phenomenon that springs from the bottom up — literally, in the sense that children dictated a large part of the biz this past year. Whether it was the Frozen craze of 2013/2014, the “Baby Shark” insanity of 2016/2017 or the breakthrough success of Encanto in 2021, kids — and their demands on their parents — occasionally dictate the charts in ways that are not always predictable. This year, that was clear with the success of KPop Demon Hunters, the Netflix film that spawned a hit soundtrack and the breakout single “Golden,” which spent eight weeks at No. 1 on the Billboard Hot 100 and more than a dozen atop the Global 200.

But it wasn’t just the surprise of the Demon Hunters. Another genre that seemed to explode this year was Christian/Gospel, which spawned several breakout hits and artists (Brandon Lake and Forrest Frank most notably) and made big strides year over year, growing 16.6% through the week ending Nov. 20 over the same period in 2024, according to Luminate.

After its Christmas 2024 debut led to rave reviews and some box office success, the Bob Dylan biopic A Complete Unknown kicked the year off with eight Oscar nominations, including best picture and best actor for the Dylan-portraying Timothee Chalamet, though it ultimately came up empty at the show. But it proved a coup for Sony, Dylan’s recording home his entire career, and kept the label’s parade of biopics going into this year, including the Bruce Springsteen biopic Deliver Me From Nowhere, which has garnered Oscar buzz for leading man Jeremy Allen White. To varying degrees, Sony also played a role in the Whitney Houston film I Wanna Dance With Somebody (Houston’s estate is part-owned by Primary Wave) and the upcoming Michael Jackson movie, Michael, set for next year.

Sony isn’t the only company going hard on the musical biopic front, of course: the aforementioned Primary Wave has had its hand in sevearl such films, while Universal was part of the Bob Marley biopic Bob Marley: One Love (also a Primary Wave vehicle), Queen’s Bohemian Rhapsody and Elton John’s Rocketman in recent years, while Warner will also be heading further down that path further moving forward. This wave is not cresting quite yet.

When the 2026 Grammy nominations were announced in early November, a few notable achievements were notched in the Big Four categories of album, song and record of the year and best new artist. First, Interscope Geffen A&M — with eight nominations among the 32 on offer in those categories — led all labels for the fifth time in eight years, behind the strength of Kendrick Lamar, Billie Eilish and Lady Gaga. That marked the second time in as many years that the label had two artists — Eilish and Lamar — land nominations in both record and song, a major achievement for any one label to have. But Interscope actually had three nominated this year, as Gaga also picked up noms in both categories.

But Interscope wasn’t the only label to make serious waves. Last year, Island Records made history as the first label to have two artists nominated in each of the Big 4 categories in the same year — Chappell Roan, who ultimately won best new artist, and Sabrina Carpenter, who didn’t win in any of the Big 4 categories but did take home best pop vocal album. This year, Island not only saw Roan and Carpenter each pick up a second straight record of the year nom apiece (for “The Subway” and “Manchild,” respectively), but Carpenter became just the fifth artist since 1980 to be nominated for album of the year in back-to-back years. The others to do it? Taylor Swift, who did it twice (Folklore and Evermore in 2021/2022; Midnights and The Tortured Poets Department in 2024/2025); Gaga (The Fame and The Fame Monster in 2010/2011); Kanye West (The College Dropout and Late Registration in 2005/2006) and Billy Joel, who, like Swift, also did it twice (52nd Street and Glass Houses in 1980/1981; The Nylon Curtain and An Innocent Man in 1983/1984).