Major Record Labels in Talks to License Music to AI Startups Udio and Suno Amid Copyright Lawsuits

Major record labels are reportedly engaging in licensing negotiations with AI music firms Udio and Suno, according to a recent Bloomberg report. Universal Music Group, Warner Music Group, and Sony Music Entertainment are exploring frameworks to regulate how AI companies compensate artists for using their work. These talks are significant because the record labels are seeking a small stake in both Udio and Suno. Such an arrangement could provide them with greater influence over the startups' operations and future direction. Udio and Suno offer aspiring musicians a way to create audio recordings through simple text prompts. For example, users can request “a modern country ballad about unrequited love,” and the AI systems will generate the corresponding track. This technology has the potential to democratize music creation, making it easier for newcomers to produce high-quality content. However, this innovative approach has not been without controversy. Last year, the major record labels sued Udio and Suno for copyright infringement, claiming that the AI-generated music used elements of copyrighted songs without proper authorization. The ongoing lawsuits have prompted both parties to seek a mutually beneficial agreement rather than continue their legal battles. At the heart of these discussions lies a desire for balance. The music companies are aiming to maintain control over the use of their intellectual property, ensuring that artists are fairly compensated. Meanwhile, the AI startups are looking for the flexibility to experiment and innovate within the industry. If successful, these negotiations could set important precedents for how AI technologies interact with traditional music rights and royalties.