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On Oct. 29, Universal Music Group (UMG) announced a landmark deal with AI music startup Udio. As part of the agreement, Udio, which UMG was suing for widespread copyright infringement along with the two other major music companies, offered a compensatory settlement with UMG, effectively ending UMG’s part of the lawsuit and paving the way for a new version of Udio, set to release in 2026, which would be a “new commercial music creation, consumption and streaming experience” that would remunerate participating UMG artists.
To survey the industry’s reaction to the deal, Billboard spoke with professionals who have been following the development of AI music closely from various vantage points, including labels, investment firms, AI music start-ups, the songwriting community and consultancies.
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“This deal is beneficial for the music industry,” one label professional tells Billboard. “My question is, though, is it beneficial for Udio? In the short term, they’re going to go through some tension as they do a reset, but this could be great. It’s early.”
To most who spoke to Billboard for this story, the timing of the deal wasn’t entirely surprising. One label executive points out that news of the agreement was cleverly released just hours before UMG’s Q3 earnings call. Still, Sean Power, CEO of Musical AI, says he “expected a deal in Q1 of 2026, not now.”
Since this summer, reports have circulated that the majors have been discussing settlements with Suno and Udio, leading many to believe the talks were getting close. But as the year wore on, some grew skeptical that settlements would be reached by the end of the year. Though the UMG-Udio deal represents the start of reconciliation, these lawsuits are far from over — Warner Music Group and Sony Music are still pursuing their claims against Udio, and all three majors are still pursuing their lawsuit against Suno.
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Vickie Nauman, founder of music-tech consultancy CrossBorder Works, says she’s been watching out for this deal since Lucian Grainge, UMG’s chairman/CEO, released a letter on Oct. 13 expressing the company’s plans to pursue AI deals. “I saw that as Lucian putting a stake in the ground about AI,” Nauman says. “When I read that, I thought, ‘He wouldn’t say this unless he’s pretty sure he will reach a deal soon.’ That letter exuded confidence.”
As part of the deal with UMG, Udio is pivoting its offerings, launching a new version of the service in 2026 that will be focused on building fandom and encouraging engagement with existing music, rather than just offering brand-new songs at the click of a button, as it does now. The new version of Udio will feature a number of tools that will allow users to remix, mash up and riff on the songs of participating UMG artists. Users will also be able to create songs in the style of participating artists and use some artists’ voices on songs.
One investor, who has not invested in Suno or Udio and spoke to Billboard on the condition of anonymity, said that he fears Udio will run into the same problems as AI film company Runway, which signed a deal with Lionsgate to adapt their intellectual property — a partnership that, one year later, has yet to produce results. “The Lionsgate catalog is too small to create a model,” a person familiar with the situation told The Wrap. “In fact, the Disney catalog is too small to create a model.”
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A label executive, who spoke under the condition of anonymity, adds: “I’d like to see Udio succeed, because I think they’re trying to get on the right side of history. Do I think this deal puts them in a little bit of a box, though? Yes.”
Songwriter/producer Oak Felder raised another point in my TikTok comment section: “The question is: how does [this deal] affect catalogs that are split between Universal and Sony or any other publisher without a deal[?] Udio can’t utilize a song in Universal’s catalog that’s split between writers on non-Universal publishers, right?” (A UMG rep declined to provide specific details on that point.)
Udio and UMG’s deal allows artists to opt in with “granular” controls, as Udio CEO Andrew Sanchez told Billboard shortly after the deal was announced, over which parts of the new Udio service they want to participate in — seen as a win for artists’ autonomy. But the investor asks: “How many of these artists are actually going to opt in?”
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Another possible challenge for Udio: there are already multiple companies offering, or planning to offer, remixing and fan-focused AI features. This includes MashApp, Hook and Spotify, which recently announced that it’s working on AI music products, including remixing features, with the consent of the majors and some large independent music companies.
“It’s a calculated risk,” says Nauman about Udio’s decision to pivot, but she notes that trying to build a business that allows everyone to create quick songs was a risk, too. “I think that just the idea of being able to prompt a few songs easily is kind of a fad, so this [new Udio service] could be interesting. But users will be the ultimate arbiter here.”
Executives interviewed for this story were mixed on how they think Udio’s deal with UMG will impact Suno. “If I were Suno, I would be feeling a lot of pressure after this deal,” says Power. “But also, I don’t imagine that its investors are scared of litigating this to the end.”
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Barclays Research recently pointed out that Suno’s fundraising better insulates it from the impact of these lawsuits with the majors than Udio: “Even a [tough] settlement…would likely only mean the disappearance of Udio, while…Suno may have the necessary financial firepower.”
The anonymous investor adds, “One thing that helps Suno here is they will capture all the Udio users that are going to unsubscribe,” given that Udio is pivoting to become a different service. As part of the UMG deal, Udio prevented its users from exporting their work from Udio, effective immediately. This led to backlash among users, who felt they should’ve been warned about the change. Soon after, Udio allowed users to export their work during a 48-hour window.
Nauman says the UMG-Udio deal “puts every single AI music company, including Suno, on notice. I’ve already seen a number of comments from people in music who are saying Udio is very impressive and friendly. That’s an important piece to this. When engaging with rights holders and licensing, it’s both incredibly transactional but also very relationship and trust-driven. Udio is in a strong position by earning that trust.”
Most interviewed for this story saw the deal as an important step forward for the music business. But does it make Warner and Sony more likely to come to the table? “What Sony and Warner do here, I’m not exactly sure,” says Power. “I’m going to be very interested to see where things land, and I’m really thinking about Universal here. They’re now the ones who can say they made the big move.”
Trending on Billboard Danish rights organization Koda has filed a lawsuit against AI music company Suno, alleging that it infringed on copyrighted works from its repertoire — including songs by Aqua, MØ and Christopher. Koda claims that Suno used these works to train its AI models without permission and has concealed the scope of what […]
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On Wednesday night (Oct. 29), Universal Music Group (UMG) and AI music company Udio announced they had reached a strategic agreement. Importantly, this agreement not only settled UMG’s involvement in the massive copyright infringement litigation the major labels brought against Udio and another AI music company, Suno, last summer, but also paved the way for the two companies to “collaborate on an innovative, new commercial music creation, consumption and streaming experience,” according to the announcement.
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The newly revamped version of Udio is set to debut in 2026, and it will feature fully-licensed UMG sound recordings and publishing assets that are totally controlled by UMG — but only those from artists that choose to participate.
Here, Billboard looks at the deal more deeply and answers some questions that have arisen in the wake of the first-of-its-kind agreement.
Why did UMG and Udio decide to come together and settle this week?
It’s hard to know exactly what happened behind closed doors, but reports that the major music companies had been in talks to settle with Udio — and Suno, which was also sued in a nearly identical lawsuit by the majors — have been circulating since this summer, making it relatively unsurprising to hear that at least one deal has been finalized.
One clue as to why there was incentive to settle here comes from a recent Barclays Research report on the majors’ lawsuits against the AI music firms, which stated that it could be “prohibitively expensive to lose” for Udio, much more than Suno, given the two firms had raised $10 million and $125 million, respectively, at the time the report was published on Tuesday (Oct. 28). Even a tough settlement, the report states, “would likely only mean the disappearance of Udio.”
The timing of the press release about the UMG-Udio deal also arrived the night before UMG’s Q3 earnings call, which took place yesterday (Oct. 30). The company has a history of announcing big news just before earnings calls in general, including one instance when UMG reached an agreement with TikTok the night before earnings in 2024 after a three-month standoff.
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What exactly will this 2026 version of Udio entail?
The new version of Udio will feature a number of tools to allow users to remix, mash up and riff on the songs of participating UMG artists. Users will also be able to create songs in the style of participating artists and use some artists’ voices on songs.
According to Udio CEO Andrew Sanchez, who spoke to Billboard just after the deal was announced, “[Udio is] going to involve all kinds of AI models, like a base model… The best way to explain it, [is it] will have sort of like flavors of the model that will be specific to particular styles or artists or genres. And this, again, provides an enormous amount of control.”
How can UMG artists and songwriters participate, and can they get paid for that?
Yes, UMG artists and songwriters will be remunerated for participating in Udio. According to a source close to the deal, this will include financial rewards for both the training process of the AI model and for its outputs. The details of exactly how that payment will work beyond this are unclear. Sanchez declined to answer a question about whether the model uses attribution (tracing back which songs in a training dataset influenced the outputs of a model) or digital proxies (a selected benchmark, like streaming performance, used to determine the popularity of songs in a dataset against others overall) as a way to determine payment — two of the most often proposed methods of AI licensing remuneration.
This answer is also made more complicated when considering the breadth of AI tools Udio plans to offer on its service. Importantly, artists can pick and choose exactly which Udio tools they “opt-in” to: “We’re going to launch with a set of features that has a spectrum of freedom that the artist can control,” Sanchez said. “There are some features that will be available to users that will be more restrictive in what they can do with their artists or their songs. And then there will be others that are more permissive. The whole point of it is not only education but just meeting artists at the levels they’re comfortable with.”
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Who is the target audience for the newly revamped Udio?
According to Sanchez, it’s fans: “We want to build a community of superfans around creation. As we say internally, it’s connection through creation — whether that’s with artists or that connection with other music fans. We want to lean into that. I think it’s going to be a huge asset for artists and fandoms.”
Are Sony and Warner still pursuing their lawsuits against Udio?
Yes, for now. UMG’s settlement and deal with Udio does not impact Sony Music and Warner Music Group’s lawsuit against Udio for widespread copyright infringement. While some industry onlookers posit that Sony and Warner are more encouraged to settle now that UMG is no longer pursuing litigation against Udio, there’s no indication that these companies are definitely planning to do so yet.
Why are some Udio users upset about this deal?
By doing this deal with UMG, Udio has agreed to a major pivot in its offering to users. Currently, the site is known for helping users make songs from simple text prompts, which they can then export and upload to streaming services, share on social media — or whatever they want to do.
Users are particularly upset because, as part of this deal with UMG, Udio immediately removed its users’ ability to download their work from the service. Angry subscribers gathered on a subreddit to complain. “This feels lie an absolute betrayal,” wrote one user. “I’ve spent hundreds of $$$ and countless hours building tracks with this tool,” wrote another. “No one warned us that one day, we wouldn’t even be able to access our own music. You can’t just pull the plug and call that a ‘transition.’”
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In a statement to Billboard on Thursday (Oct. 30), an Udio spokesperson said that disabling exports on the platform is “a difficult but necessary step to support the next phase of the platform and the new experiences ahead.” On Friday (Oct. 31), Udio relented slightly, writing on Reddit that starting Monday (Nov. 3), the platform will give users a 48-hour window to download their existing songs — and that any songs downloaded during that time will be covered by the terms of service that existed before the UMG deal was signed.
The move to restrict downloads in the long term may prove to be more than just an inconvenience for users — Udio could also be hit with legal claims over it. There could be arguments made that disabling downloads was a breach of the subscription contract that Udio signed with users, or that Udio falsely advertised its services in violation of consumer protection laws. It wouldn’t be the first time this has happened in recent memory: Just last year, Amazon Prime users brought claims like this over changes to the cost of ad-free movie and TV streaming for subscribers.
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Universal Music Group and Udio have settled their legal battle by striking a deal for a fully-licensed artificial intelligence music platform. But the broader litigation involving rival AI firm Suno and both Sony Music and Warner Music is still very much pending.
The deal, announced Wednesday, will end UMG’s allegations that Udio broke the law by training its AI models on vast troves of copyrighted songs. Under the agreement, Udio will pay a “compensatory” settlement and the two will partner on a new subscription AI service that pays fees to UMG and its artists, and allows artists to opt in to different aspects of the new service.
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But that agreement will not resolve the entire legal battle, in which all three majors teamed up last year to sue both Udio and Suno — the other leading AI music firm — for allegedly “trampling the rights of copyright owners” by infringing music on an “unimaginable scale.”
For now, Sony and Warner will continue to litigate their case against Udio, but a settlement like the one struck by UMG obviously creates a framework for them to reach a similar deal. The revamped Udio 2.0 will not be an exclusive UMG partner, according to sources close to the situation — meaning it’s able to strike similar catalog licensing deals with Sony and Warner, as well as any other parties.
Udio has ample incentive to do so. Past experience has shown that music licensing for tech platforms is something of a zero-sum proposition; it often doesn’t work for users if you have glaring gaps in your catalog of songs. Spotify wouldn’t be nearly as ubiquitous if it were missing catalogs by Taylor Swift, Drake or The Beatles, while TikTok’s standoff with UMG last year ended up impacting non-UMG recording artists like Beyoncé and Adele due to rights being owned by different companies.
In striking the deal, Udio has also effectively put its cards on the table: it wants to be the music industry’s AI good guy. Though not legally impossible, it’s hard to argue in court that you don’t need training licenses and artist consent while touting the benefits of both in press releases. Udio has also already made concrete changes to its platform, including controversially disabling downloads for its existing subscribers — a further sign that it’s no longer looking to fight it out.
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It’s worth noting that the settlement makes for odd bedfellows in any ongoing litigation. The same team of lawyers that repped UMG in its claims against Udio — now settled with a first-of-its-kind partnership — is also representing competitors Sony and Warner as they continue to sue that company. Ditto for Suno, which is defended by the same team of attorneys as Udio, which just agreed to sign a licensing deal that’s antithetical to Suno’s core argument that no such deals are needed.
But such situations are par for the course for cases like these, where industry rivals team up for a legal case, and each company on both sides almost certainly signed agreements waiving any legal right to argue that their lawyers have a conflict of interest.
The case against Suno, on the other hand, looks more likely to keep going. All three majors are still suing that company, and Suno has long been seen in industry circles as more the more combative of the two. One can’t imagine that Suno’s will to fight will be reduced by the Udio deal; if anything, it has a clearer runway to AI music dominance now that its largest text-to-audio rival has effectively left the space to cultivate its own walled-off garden.
The Suno lawsuit remains at the earliest stage, where a defendant will file a motion to dismiss a case, which is typically the first big ruling in a civil litigation. If both sides decide to fight it out, the case and resulting appeals could go on for years into the future. But the key battle lines of the litigation are already clear.
The multi-million-dollar question is whether training AI platforms like Suno on millions of unlicensed copyrighted songs counts as “fair use,” a legal doctrine that allows for the reuse of protected works in certain circumstances. That issue is also at the heart of dozens of other lawsuits filed against booming AI firms by book authors, news outlets, movie studios, comedians and visual artists — meaning it might really be more of a trillion-dollar question.
Can Suno prevail on that point, making Udio look silly for settling so early? The proverbial jury is very much still out.
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One federal judge, ruling on a major case against Anthropic, sided resoundingly with AI firms, saying that unlicensed training was clearly a fair use because it was no different than a human writer taking inspiration from copyrighted books they had read. But another judge ruled that such training would be illegal “in many circumstances” and that AI firms expected to generate “trillions” in profits “will figure out a way to compensate copyright holders.”
A separate, emerging flashpoint in the case is whether Suno broke the law by “stream-ripping” its training songs from YouTube. That’s a key issue in the wake of a court ruling this summer that said AI training on copyrighted works itself is fair use, but that using illegally-obtained works to do so could lead to billions in damages for AI firms.
In the wake of this week’s Udio settlement, the record labels likely see that deal as setting a helpful precedent: “See, AI companies do need licenses to train their models — Udio just took one.” And in that same vein, when it comes to that all-important courtroom battle over fair use, those same music companies likely view this week’s Udio deal as potential legal ammo.
A key factor in the fair-use analysis is whether exploiting a copyrighted work for free caused market harm — whether it hurt the ability of the original author to monetize their own creative output. A major licensing deal with a direct competitor would seem to be a very obvious market that would be harmed by the conduct of Suno, which says it can build its AI models without such deals.
But that argument has already been rejected in both of those earlier fair-use rulings. Even for the judge who said AI training would be illegal in most circumstances, that kind of argument would be “circular” — since essentially any copyright owner could argue that the specific thing they’re suing over is a lost market opportunity. That means the Udio deal might help the labels in the business world and the court of public opinion, but likely not in actual court. For now, time will tell.
For deeper reading, go check out the full lawsuits against Suno and Udio, and go read the responses from Suno and Udio. And stick with Billboard for updates as the cases move ahead.
The three major music companies — Sony Music, Universal Music Group and Warner Music Group — are in talks with AI music companies Suno and Udio to license their works as training data, despite suing the two startups for infringement “on an almost unimaginable scale” last summer. Now, executives in the “ethical” or “responsible” AI music space are voicing displeasure that the alleged infringers could potentially benefit from their actions.
Several of those ethical AI companies said they were led to believe they would be rewarded by the record labels for going through the tough process of licensing music from the beginning, in what one AI music company founder previously told Billboard would be “a carrot and stick approach to AI,” penalizing those who raced ahead and trained models without permission or compensation.
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“That’s all out the window,” that founder says now. “I was talking to another founder that does ethical AI voice models, and he told me, ‘F–k it. I don’t care anymore. Why does it matter to be ethical if we just get left behind?’”
Ed Newton-Rex, founder of non-profit Fairly Trained, which certifies ethically-trained AI models, adds: “If I were running a startup that had tried to do the right thing — respecting creators’ rights — and investors had rejected me because I wasn’t exploiting copyrighted work like so many others, and then this happened? I’d definitely be pissed off.”
Tracy Chan, CEO of AI music company Splash, told Billboard via email that she stands by her decision to license music from the start. “At Splash, being ethically trained wasn’t a debate — it was obvious,” she says. “We’re musicians and technologists. We believe AI should amplify creativity, not exploit it. We don’t need to scrape the world’s music to make that happen.”
It remains unclear how far along these licensing talks are between the major music companies and Suno and Udio, and if deals will even come to fruition to avert the blockbuster lawsuits. It’s common in costly and lengthy litigation like this for the two sides to discuss what it would look like to settle the dispute outside of court. Plus, licensing is what the majors have wanted from AI companies all along — does it matter how they come to it?
Multiple executives expressed fear that if the majors ditch the lawsuit and go for deals, they will set a bad precedent for the entire business. “Basically, if they do this deal, I think it would send a message to big tech that if you want to disrupt the music industry, you can do whatever you want and then ask for forgiveness later,” says Anthony Demekhin, CEO/co-founder of Tuney.
This, however, is not the first time the music business has considered a partnership with tech companies that were once their enemy. YouTube, for example, initially launched without properly licensing all of the music on its platform first. In his 2024 New Years’ address to staff, Lucian Grainge, CEO/chairman of UMG, alluded to this, and how he would do it differently this time with his so-called “responsible AI” initiative. “In the past, new and often disruptive technology was simply released into the world, leaving the music community to develop the model by which artists would be fairly compensated and their rights protected,” he wrote, adding that “in a sharp break with the past,” UMG had formed a partnership with YouTube to “give artists a seat at the table” to shape the company’s AI products, and that the company would also collaborate “with several [other] platforms on numerous opportunities and approaches” in the AI space.
Another part of Grainge’s “responsible AI” initiative was “to lobby for ‘guardrails,’ that is public policies setting basic rules for AI.” Mike Pelczynski, co-founder of ethical AI voice company Voice-Swap, also worries that if these deals go through, they could weaken the music industry’s messaging to Capitol Hill, where bills like the NO FAKES Act are still in flux. “All the messaging we had before, all the hard-lining about responsible AI from the beginning, it’s gone,” he says. “Now, if policy makers look at [the music business] they might say, ‘Wait, what side should we take? Where do you stand?’”
If talks about licenses for Suno and Udio move forward, determining exactly how that license works, and how artists will be paid, will be complex. To date, almost all “ethical” AI companies are licensing their musical training data from production libraries, which offer simple, one-stop licenses for songs. Alex Bestall, CEO of music production house and AI company Rightsify, says that the structure of those deals are typically “flat-fee blanket licenses for a fixed term, often one to three years or in some cases perpetuity… all data licensing [music or otherwise] is pretty standardized at this point.”
It’s unclear if the deals the majors have discussed with Suno and Udio will follow this framework, but if they did, the question then comes — how do the majors divide up those fees for their artists and writers? The Wall Street Journal reported that “the [music] companies want the startups to develop fingerprinting and attribution technology — similar to YouTube’s content ID — to track when and how a song is used.” In that scenario, the money received would be given to signees based on usage.
While there are a few startups working on music attribution technology right now, multiple experts tell Billboard they don’t think the tech is ready yet. “Attribution is nowhere,” says Newton-Rex, who also previously worked as vp of audio at Stability AI. “It’s not even close. There’s no system that I have seen that would do a decent job of accurately assigning attribution to what has inspired a given song.”
Even the possibility of deals between the parties has sparked a larger conversation about how to handle tech companies who ask for forgiveness — and not for permission — from the music business.
“If the two biggest offenders actually become the legal standard, it’s effectively like making Pirate Bay into Spotify,” says Demekhin. “I understand it from a business perspective because it’s the path of least resistance [to settle and get a license now]. But this could send a message to tech that could bite the industry on the next wave.”
Over the weekend, Bloomberg broke the news that the Sony Music, Universal Music Group and Warner Music Group are in talks with Suno and Udio to license their music to the artificial intelligence startups. If the deals go through, they could help settle the major music companies’ massive copyright infringement lawsuit against Suno and Udio, filed last summer.
Billboard confirmed that the deals in discussion would include fees and possible equity stakes in Suno and Udio in exchange for licensing the music — which the two AI firms have already been using without a license since they launched over a year ago.
That sounds like a potentially peaceful resolution to this clash over the value of copyrighted music in the AI age. But between artist buy-in, questions over how payments would work and sensitivities on all sides, the deals could be harder to pull off than they seem. Here’s why.
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You need everyone on board
Ask anyone who’s tried to license music before: it’s a tedious process. This is especially true when a song has multiple songwriters, all signed to different companies — which is to say, almost all of pop music today. Since any music that is used as training data for an AI model will employ both its master recording copyright and its underlying musical work copyright, Suno and Udio cannot stop at just licensing the majors’ shares of the music. They will also need agreements from independent labels and publishers, too, to use a comprehensive catalog.
And what about the artists and songwriters signed to these companies? Generative AI music is still controversial today, and it is foreseeable that a large number of creatives will not take too kindly to their labels and publishers licensing their works for AI training without their permission. One can imagine that the music companies, to avoid a revolt from signees, would allow talent to either opt-out of or opt-in to this license — but as soon as they do that, they will be left with a patchwork catalog to license to Suno and Udio. Even if a song has one recording artist and five songwriters attached to it, it only takes one of those people to say no to this deal to eliminate the track from the training pool.
Is the expiration date really the expiration date?
Licensing music to train AI models typically takes the form of a blanket license, granted by music companies, that lasts between one and three years, according to Alex Bestall, CEO of Rightsify, a production music library and AI company. Other times it will be done in perpetuity. Ed Newton-Rex, former vp of audio for Stability AI and founder of non-profit Fairly Trained, previously warned Billboard that companies that license on a temporal basis should look out for what happens when a deal term ends: “There’s no current way to just untrain a model, but you can add clauses to control what happens after the license is over,” he said.
Attribution technology seems great — but is still very new
Many experts feel that the best way to remunerate music companies and their artists and songwriters is to base any payouts on how often their work is used in producing the outputs of the AI model. This is known as “attribution” — and while there are companies, like Sureel AI and Musical AI, out there that specialize in this area, it’s still incredibly new. Multiple music industry sources tell Billboard they are not sure the current attribution models are quite ready yet, meaning any payment model based on that system may not be viable, at least in the near term.
Flat-fee licenses are most common, but leave a lot to be desired
Today, Bestall says that flat-fee blanket licenses are the most common form of AI licensing. Given the complexities of fractional licensing (i.e., needing all writers to agree) with mainstream music, the AI music companies that are currently licensing their training data are typically going to production libraries, since those tend to own or control their music 100%. It’s hard to know if this model will hold up with fractional licensing at the mainstream music companies — and how they’ll choose to divide up these fees to their artists.
Plus, Mike Pelczynski, founder of music tech advisory firm Forms and Shapes and former head of strategy for SoundCloud, wrote in a blog post that “flat-fee deals offer upfront payments but limit long-term remuneration. As AI scales beyond the revenue potential of these agreements, rights holders risk being locked into subpar compensation. Unlike past models, such as Facebook’s multi-year deals, AI platforms will evolve in months, not years, leaving IP holders behind. Flat fees, no matter how high, can’t match the exponential growth potential of generative AI.”
There’s still bad blood
The major music companies will likely have a hard time burying the hatchet with Suno and Udio, given how publicly the two companies have challenged them. Today, Suno and Udio are using major label music without any licenses, and that defiance must sting. Suno has also spoken out against the majors, saying in a court filing that “what the major record labels really don’t want is competition. Where Suno sees musicians, teachers and everyday people using a new tool to create original music, the labels see a threat to their market share.”
Given that context, there is a real reputational risk here for the labels, who also represent many stakeholders with many different opinions on the topic — not all of them positive. For this licensing maneuver to work, the majors need to be able to feel (or at least position themselves to look like) they came out on top in any negotiation, particularly to their artists and songwriters, and show that the deals are in everyone’s best interests. It’s a lot to pull off.
AI music company Suno has debuted a number of new features, allowing users to have more control over the creation and customization of their songs. The company has been known as a powerful generative tool that can make realistic songs at the click of the button with just a few simple prompts, but now, it is embracing more of a collaborative approach between the user and its AI technology.
Now, users can upload up to eight minutes of audio, whether its a hummed melody or a mostly-completed track, and then use Suno to remix it or expand it. Through their new Song Editor features, users can replace lyrics and reimagine sections of songs, as desired. Offering what it calls the “creative slider” users can rework a song into a new genre by using simple toggles that can up a song’s “weirdness” “style strength” or “audio strength.”
The company has also integrated a stem extraction tool to split a Suno-generated song into 12 clean stems, which can then be exported to a user’s preferred DAW.
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Suno CEO/founder Mikey Shulman says of the new features: “We envision Suno as a core part of musical creativity, for everyone from novices to Grammy winners. Our new tools offer powerful ways to explore new sonic ideas, remix, and iterate. Our upgraded editing suite gives artists more control than ever over their music.
We’re also working to better integrate Suno into the music production process. For example, Suno’s new stem extraction feature allows artists to more easily bring what they do with Suno into their favorite DAW, and vice versa. We’re excited to keep building tools like these to augment the creativity of musicians and expand access to serious music making.”
The announcement comes just a couple days after news broke that Suno, and its competitor Udio, are in talks with the major music companies — Sony Music, Universal Music Group and Warner Music Group — about licensing their copyrights for AI training. This may include the majors receiving some equity in the two AI music firms, as they have done in previous licensing agreements with new tech companies, like Spotify.
Last summer, Sony, Universal and Warner came together to sue Suno and Udio for copyright infringement of their sound recordings “at an almost unimaginable scale” to train their AI music models. If these licensing deals were to go through, it would likely lead to a settlement of the lawsuits.
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.
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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.
Amazon has partnered with AI music company Suno for a new integration with its voice assistant Alexa, allowing users to generate AI songs on command using voice prompts. This is part of a much larger rollout of new features for a “next generation” Alexa, dubbed Alexa+, powered by AI technology.
“Using Alexa’s integration with Suno, you can turn simple, creative requests into complete songs, including vocals, lyrics, and instrumentation. Looking to delight your partner with a personalized song for their birthday based on their love of cats, or surprise your kid by creating a rap using their favorite cartoon characters? Alexa+ has you covered,” says an Amazon blog post, posted Wednesday (Feb. 26).
Other new Alexa+ features include new voice filters, image generation, smart home operation, Uber booking and more. It also includes an integration with Ticketmaster to “find you the best tickets to an upcoming basketball game or to the concert you’ve been dying to go to,” according to the blog post.
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Suno is known to be one of the most powerful AI music models on the market, able to generate realistic lyrics, vocals and instrumentals at the click of a button. However, the company has come under scrutiny by the music business establishment for its training practices. Spearheaded by the RIAA, Universal Music Group, Sony Music and Warner Music Group came together last summer to sue Suno and its rival Udio, accusing the AI music company of copyright infringement “on an almost unimaginable scale.” At the time, neither AI company had admitted to training on copyrighted material.
In a later filing, Suno admitted that “it is no secret that the tens of millions of recordings that Suno’s model was trained on presumably included recordings whose rights are owned by the Plaintiffs in this case.” Its CEO, Mikey Shulman, added in a blog post that same day, “We see this as early but promising progress. Major record labels see this vision as a threat to their business. Each and every time there’s been innovation in music… the record labels have attempted to limit progress,” adding that Suno felt the lawsuit was “fundamentally flawed” and that “learning is not infringing.”
More recently, German collection society GEMA also took legal action against Suno in a case filed Jan. 21 in Munich Regional Court.
Still, a couple of music makers have sided with Suno. In October, Timbaland was announced as a strategic advisor for the AI music company, assisting in “creative direction” and “day-to-day product development.” Electronic artist and entrepreneur 3LAU has also been named as an advisor to the company.
News of Amazon’s deal with Suno comes just months after its streaming service, Amazon Music, was commended by the National Music Publishers’ Association for finding a way to add audiobooks to its “Unlimited” subscription tier in the U.S. without “decreas[ing] revenue for songwriters” — a contrast to Spotify, which decreased payments to U.S. publishers by about 40% when it added audiobooks to its premium tier.
In case you missed it: Suno has picked up another lawsuit against it.
Before you read any further, go to this link and listen to one or two of the songs to which GEMA licenses rights and compare them to the songs created by the generative music AI software Suno. (You may not know the songs, but you’ll get the idea either way.) They are among the works over which GEMA, the German PRO, is suing Suno. And while those examples are selected to make a point, based on significant testing of AI prompts, the similarities are remarkable.
Suno has never said whether it trained its AI software on copyrighted works, but the obvious similarities seem to suggest that it did. (Suno did not respond to a request for comment.) What are the odds that artificial intelligence would independently come up with “Mambo No. 5,” as opposed to No. 4 or No. 6, plus refer to little bits of “Monica in my life” and “Erica by my side?”
“We were surprised how obvious it was,” GEMA CEO Tobias Holzmüller tells Billboard, referring to the music Suno generated. “So we’re using the output as evidence that the original works were elements of the training data set.” That’s only part of the case: GEMA is also suing over the similarities between the AI-created songs and the originals. (While songs created entirely by AI cannot be copyrighted, they can infringe on existing works.) “If a person would claim to have written these [songs that Suno output], he would immediately be sued, and that’s what’s happening here.”
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Although the RIAA is also suing Suno, as well as Udio, this is the biggest case that involves compositions, as opposed to recordings — and it could set a precedent for the European Union. (U.S. PROs would not have the same standing to sue, since they hold different rights.) It will proceed differently from the RIAA case, which involves higher damages, and of course different laws, so Holzmüller explained the case to Billboard — as well as how it could unfold and what’s at stake. “We just want our members to be compensated,” Holzmüller says, “and we want to make sure that what comes out of the model is not blatantly plagiarizing works they have written.”
When did you start thinking about bringing a case like this?
We got the idea the moment that services like Suno and Udio hit the market and we saw how easy it was to generate music and how similar some of it sounds. Then it took us about six months to prepare the case and gather the evidence.
Your legal complaint is not yet public, so can you explain what you are suing over?
The case is based on two kinds of copyright infringement. Obviously, one is the training of the AI model on the material that our members write and the processing operations when generating output. There are a ton of legal questions about that, but I think we will be able to demonstrate without any reasonable doubt that if the output songs are so similar [to original songs] it’s unlikely that the model has not been trained on them. The other side is the output. Those songs are so close to preexisting songs, that it would constitute copyright infringement.
What’s the most important legal issue on the input side?
The text and data-mining exception in the Directive [on Copyright in the Digital Single Market, from 2019]. There is some controversy over whether this exception was intended to allow the training of AI models. Assuming that it was, it allows rights holders to opt out, and we opted out our entire membership. There could also be time and territoriality issues [in terms of where and when the original works were copied].
How does this work in terms of rights and jurisdiction?
On the basis of our membership agreement, we hold rights for reproduction and communication to the public, and in particular for use for AI purposes. As far as jurisdiction, if the infringement takes place in a given territory, you can sue there — you just have to serve the complaint in the country where the infringing company is domiciled. As a U.S. company, if you’re violating copyright in the EU, you are subject to EU jurisdiction.
In the U.S., these cases can come with statutory damages, which can run to $150,000 per work infringed in cases of willful infringement. Is there an amount you’re asking for in this complaint?
We want to stake out the principle and stop this type of infringement. There could be statutory damages, but the level has to be calculated, and there are different standards to do that, at a later stage [in the case].
Our longterm goal is to establish a system where AI companies that train their models on our members’ works seek a license from us and our members can participate in the revenues that they create. We published a licensing model earlier this year and we have had conversations with other services in the market that we want to license, but as long as there are unlicensed services, it’s hard for them to compete. This is about creating a level playing field
How have other rightsholders reacted to this case?
Nothing but support, and a lot of questions about how we did it. Especially in the indie community, there’s a sense that we can only discuss sustainable licenses if we stand up against unauthorized use.
The AI-created works you posted online as examples are extremely similar to well-known songs to which you hold rights. But I assume those didn’t come up automatically. How much did you have to experiment with different prompts to get those results?
We tried different songs, and we tried the same songs a few times and it turned out that for some songs it was a similar outcome every time and for other songs the difference in output was much greater.
These results are much more similar to the original works than what the RIAA found for its lawsuits against Suno and Udio, and I assume the lawyers on those cases worked very hard. Do you think the algorithms work differently in Germany or for German compositions?
I don’t know. We were surprised ourselves. Only a person who can explain how the model works would be able to answer that.
Tell me a bit about the model license you mentioned.
We think a sustainable license has two pillars. Rightsholders should be compensated for the use of their works in training and building a model. And when an AI creates output that competes with input [original works], a license needs to ensure that original rightsholders receive a fair share of whatever value is generated.
But how would you go about attributing the revenue from AI-created works to creators? It’s hard to tell how much an AI relies on any given work when it creates a new one.
Attribution is one of the big questions. My personal view is that we may never be able to attribute the output to specific works that have been input, so distribution can only be done by proxy or by funding ways to allow the next generation of songwriters to develop in those genres. And we think PROs should be part of the picture when we talk about licensing solutions.
What’s the next step in this case procedurally?
It will take some time until the complaint is served [to Suno in the U.S.], and then the defendant will appoint an attorney in Munich, the parties will exchange briefs, and there will be an oral hearing late this year or early next year. Potentially, once there is a decision in the regional court, it could go [to the higher court, roughly equivalent to a U.S. appellate court]. It could even go to the highest civil court or, if matters of European rights are concerned, even to the European Court of Justice [in Luxembourg].
That sounds like it’s going to take a while. Are you concerned that the legal process moves so much slower than technology?
I wish we had a quicker process to clarify these legal issues, but that shouldn’t stop us. It would be very unfortunate if this race for AI would trigger a race to the bottom in terms of protection of content for training.
