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Udio & UMG AI Deal: Lawsuits Will Continue

by James Carter Senior News Editor
written by James Carter Senior News Editor

The AI Music Revolution: Udio’s Settlement Signals a Licensing Future, But Suno Still Has Fight Left

The music industry is bracing for a seismic shift. A recent settlement between Universal Music Group (UMG) and AI music platform Udio isn’t just a legal win for the labels; it’s a stark signal that the era of unlicensed AI music creation is rapidly drawing to a close. While Udio has effectively chosen a path of collaboration, the ongoing legal battle with Suno – and the broader implications for copyright in the age of artificial intelligence – could ultimately determine whether AI becomes a partner or a predator to the creative world.

Udio’s Strategic Retreat and the Rise of Licensed AI

UMG’s lawsuit against Udio, alleging copyright infringement through the training of AI models on copyrighted songs, has ended with a landmark agreement. Udio will pay a settlement and, crucially, partner with UMG on a new subscription service that compensates artists and allows them to control their participation. This move is a calculated one by Udio, signaling a desire to be seen as the “good guy” in the AI music space. Disabling downloads for existing subscribers, while controversial, further underscores this commitment to a legally compliant future.

This settlement isn’t an isolated incident. It sets a precedent that Sony and Warner Music Group are likely to follow, potentially reaching similar licensing deals with Udio and other AI platforms. As Udio 2.0 expands, it will actively seek catalog licensing agreements with all major rights holders, recognizing that a fragmented catalog – like the issues Spotify faced with Taylor Swift and others – severely limits user appeal. The lesson from platforms like TikTok’s dispute with UMG is clear: comprehensive licensing is essential for success.

Suno’s Defiant Stand and the “Fair Use” Battleground

While Udio is building bridges, Suno remains firmly entrenched in a legal battle with all three major labels. Suno’s core argument – that training AI models doesn’t require licensing – is now directly challenged by the Udio settlement. However, Suno appears willing to fight, potentially positioning itself as the last bastion of the “free data” approach to AI music generation. This could allow Suno to capture a larger share of the market, at least in the short term, by offering a more unrestricted service.

The central question in the Suno case revolves around the legal doctrine of “fair use.” Does training AI on copyrighted material constitute transformative use, or does it infringe on the rights of copyright holders? This isn’t just a music industry issue; it’s a trillion-dollar question impacting book authors, news organizations, filmmakers, and visual artists alike. Recent court rulings have been split. One judge sided with AI firms, drawing parallels to human inspiration, while another suggested that AI companies generating massive profits “will figure out a way to compensate copyright holders.”

Stream-Ripping and the Shadowy Side of AI Training Data

Adding another layer of complexity, the legality of how Suno obtained its training data is under scrutiny. The practice of “stream-ripping” – extracting audio from platforms like YouTube – could lead to significant damages, even if AI training itself is deemed fair use. A recent court ruling clarified that while training on copyrighted works may be permissible, using illegally obtained works to do so is not. This highlights the importance of data provenance and ethical sourcing in the AI development process.

The Implications for Artists and the Future of Music Creation

The Udio settlement provides a potential roadmap for a future where AI and the music industry coexist. However, the details of artist compensation and control within the new subscription service will be critical. Will artists have genuine agency over how their work is used, or will they simply receive a small share of the profits generated by AI-powered music? The answer to this question will shape the relationship between artists and AI for years to come.

The legal battles surrounding AI music are far from over. The outcome of the Suno case will have far-reaching consequences, not just for the music industry, but for the entire creative landscape. The stakes are high, and the future of music – and potentially all creative content – hangs in the balance. For a deeper dive into the legal complexities, explore the full lawsuits against Suno and Share: Billboard’s coverage of the Suno lawsuit provides a comprehensive overview.

What are your predictions for the future of AI-generated music? Share your thoughts in the comments below!

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Entertainment

UMG CEO Lucian Grainge Decries Drake’s ‘Not Like Us’ Lawsuit as ‘Ridiculous

by Marina Collins - Entertainment Editor
written by Marina Collins - Entertainment Editor

Lucian Grainge, the CEO of Universal Music Grouphas issued his first public response (and it’s a fiery one) to Drake’s lawsuit against the company for what he alleges to be the strategically defamatory promotion of Kendrick Lamar’s hit diss song “Not Like Us.”

Earlier this week, Drake’s attorneys attempted to force Grainge to submit documents they believe would build their case of the alleged CEO’s involvement in the planning and release of “Not Like Us” in filings reviewed by Rolling Stone. In turn, in filings submitted by UMG attorneys to the Southern District of New York presiding over the case (which Rolling Stone also reviewed), Grainge called the idea that he had anything to do with the minutiae of the song’s release “farcical,” among other choice words.

While claiming that Grainge had personal involvement in the distribution of “Not Like Us,” Drake’s motion for documents from the executive also pointed to his authorship of the company’s Code of Conduct, where it claims he wrote that UMG’s leadership should be held “accountable for the decisions we make and how we conduct ourselves.”

The motion asserts that Grainge instead has been allegedly aware of and callous towards the impact Lamar’s assertion that Drake is a “pedophile” in his lyrics and on the single artwork. It also cites the fact that Grainge publicly celebrated “Not Like Us” winning the Grammy for Record of the Year alongside its allegation of Grainge’s critical involvement as part of an attempt to “devalue Drake’s music and brand in order to gain leverage in negotiations for an extension” of his contract.

Grainge isn’t having it. “Given Drake’s motion, I would like to make it quite clear that I had never heard the recording ‘Not Like Us,’ nor ever saw the corresponding cover art or music video, until after they were released by Interscope Records,” the CEO said in declaration attributed to him personally.

“Whilst, as part of my role, I certainly have financial oversight of and responsibility for UMG’s global businesses, the proposition that I was involved in, much less responsible for, reviewing and approving the content of ‘Not Like Us,’ its cover art or music video, or for determining or directing the promotion of those materials, is groundless and indeed ridiculous.”

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Given his responsibilities as the at the top of “a publicly-traded, multi-billion dollar, multi-national corporation whose operations in over sixty countries covering nearly 200 markets,” Grainge adds that it “makes no sense whatsoever” that he was “in the weeds as to the release and promotion of any particular sound recording, from the thousands of UMG releases throughout the world.”

Grainge noted that he is accustomed to personal attacks, and that his company is accustomed to litigation tactics that “attempt to waste my and UMG’s time and resources with discovery of the sort that Drake is seeking here — either in an attempt to gain media attention or in an effort to force some kind of commercial renegotiation or financial concessions.”

As far as devaluing Drake goes, Variety reports that the star – who is also signed to UMG under Republic Records while Lamar distributes his music through the company’s Interscope subgroup – is one of the highest selling artists there, in turn earning a $400 million contract in 2022. Grainge cited the company’s massive investments in Drake as part of the so-called ridiculousness of his allegations.

“Claims that I was behind a scheme to ‘devalue’ [Drake’s] brand through the release and promotion of the Kendrick Lamar recording ‘Not Like Us’ — an allegation that makes no sense due to the fact that the company that I run, Universal Music Group N.V., has invested hundreds of millions of dollars in Drake, including longstanding and critical financial support for his recording career, the purchase and ownership of the bulk of his recording catalog, and the purchase of his music publishing rights,” Grainge wrote.

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Drake first filed his suit against UMG for defamation and harassment through Lamar’s “Not Like Us” in January. He also sued iHeartMedia for allegedly accepting “covert payments” to promote airplay of Lamar’s diss track “Not Like Us” from UMG. In March, that suit settled, with a source at iHeartMedia telling Rolling Stone“In exchange for documents that showed iHeart did nothing wrong, Drake agreed to drop his petition. No payments were made – by either one of us,” a source at iHeartMedia tells Rolling Stone.

In a separate statement, Drake’s legal team said, “We are pleased that the parties were able to reach a settlement satisfactory to both sides and have no further comment on this matter.”

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Entertainment

Lucian Grainge Counters Drake’s “Farcical” Allegations with Firm Response

by Marina Collins - Entertainment Editor
written by Marina Collins - Entertainment Editor

Lucian Grainge‘s patience is seemingly wearing thin as Universal Music Group‘s legal battle with rapper Drake rumbles on. In a declaration letter, filed on Thursday with the Southern District of New York and obtained by The Hollywood Reporterthe all-powerful head of UMG, the world’s biggest music company, fired back at Drake’s latest push to secure more documents related to the company’s relationship with Kendrick Lamardescribing the specific claims made by Drake as “farcical,” “nonsensical” and “groundless and indeed ridiculous,” with Grainge pointedly remarking that the company had spent “hundreds of millions” in supporting the Canadian rapper’s music career.

Earlier this weekDrake’s legal team made moves to find more ammunition in his defamation lawsuit against UMG. In a discovery bid, Drake urged the court to force UMG and Grainge to turn over the label’s contract with Lamar, as well as information relating to allegations of domestic violence and other alleged crimes committed by the Compton rapper.

In his declaration letter, Grainge made clear he was not involved with the release and promotion of “Not Like Us” and also sought to make clear that UMG was not trying “devalue” Drake, one of their best-selling artists. Lamar (Interscope Records) and Drake (Republic Records) are represented by different divisions of UMG.

Grainge writes that “claims that I was behind a scheme to “devalue” [Drake’s] brand through the release and promotion of the Kendrick Lamar recording “Not Like Us” — an allegation that makes no sense due to the fact that the company that I run, Universal Music Group N.V., has invested hundreds of millions of dollars in Drake, including longstanding and critical financial support for his recording career, the purchase and ownership of the bulk of his recording catalog, and the purchase of his music publishing rights.”

Further, Grainge said it “makes no sense whatsoever” that he was “in the weeds as to the release and promotion of any particular sound recording, from the thousands of UMG releases throughout the world” as his job encompassed “global strategy” at “a publicly-traded, multi-billion dollar, multi-national corporation whose operations in over sixty countries covering nearly 200 markets,” adding, claiming otherwise was “farcical.”

Grainge ends the letter with a more emphatic statement that he had nothing to do with “Not Like Us.” “Given my role, I am accustomed (and unfortunately largely resigned) to personal attacks, and I further recognize that a frequent strategy of UMG’s litigation opponents is to attempt to waste my and UMG’s time and resources with discovery of the sort that Drake is seeking here — either in an attempt to gain media attention or in an effort to force some kind of commercial renegotiation or financial concessions,” Grainge writes.

He adds, “But given Drake’s motion, I would like to make it quite clear that I had never heard the recording “Not Like Us,” nor ever saw the corresponding cover art or music video, until after they were released by Interscope Records. Whilst, as part of my role, I certainly have financial oversight of and responsibility for UMG’s global businesses, the proposition that I was involved in, much less responsible for, reviewing and approving the content of “Not Like Us,” its cover art or music video, or for determining or directing the promotion of those materials, is groundless and indeed ridiculous.”

In a separate letter submitted by UMG’s lawyers to the Southern District of New York on Thursday, the company said, “Drake’s motion is a transparent attempt to use discovery to harass UMG and force it to waste time and resources out of spite.”

The letter adds that “the premise of Drake’s motion — that he could not have lost a rap battle unless it was the product of some imagined secret conspiracy going to the top of UMG’s corporate structure — is absurd. Sir Lucian is the CEO of a multinational enterprise; his days are spent determining and implementing global strategy, not vetting individual tracks or album covers or driving the release and promotional plans for any one recording. And even if Sir Lucian had any responsive documents, they would surely be captured by discovery from UMG’s other document custodians, who were actually responsible for releasing and promoting “Not Like Us.” Drake does not come close to meeting his burden of showing that Sir Lucian must be a custodian. His motion should be denied.”

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Entertainment

Universal Music Group Reports Slight Year-on-Year Revenue Increase

by Marina Collins - Entertainment Editor
written by Marina Collins - Entertainment Editor

Universal Music Group Reports Strong Q2 Growth, Eyes Health Sector & Navigates AI Challenges

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Universal Music Group (UMG) showcased robust financial performance in the second quarter, fueled by continued growth in streaming adn a standout surge in music publishing revenue. The company reported an overall revenue increase, highlighted by an notable 11.5% jump in its music publishing division.

Growth within UMG’s recorded music business was driven by both subscription-based streaming platforms, up 5.3%, and ad-supported free streaming services, which saw a 4.4% increase.During the company’s recent earnings call, CEO sir Lucian Grainge pointed to strong performance in key global markets like China and Japan. He also revealed UMG’s growing interest in exploring opportunities within the health and wellness sector, stating the potential for music in this field is “still in its embryonic stage” and offers significant upside.

Grainge also addressed the ongoing European Commission probe into UMG’s proposed acquisition of Downtown Music Holdings. He expressed confidence the deal would be approved, emphasizing its benefits for autonomous labels and artists. “The combined company will help support the growth and success of independent labels and their artists…we remain confident that the transaction will pass that review and will be completed before the end of the year,” he stated.

digital chief Michael Nash discussed the potential of “superfan” tiers within streaming services, and addressed questions regarding the relationship between UMG and Spotify, stressing a shared commitment to quality releases. Both UMG and Spotify, he indicated, prioritize getting the product right over rushing to market.

Nash specifically praised Chinese digital service provider Tencent Music’s ‘SVIP’ tier, noting its success – particularly its pricing, which is “five times the standard-tier pricing” – as a strong validation of UMG’s strategy in a historically challenging monetization market.

The company also reaffirmed its core principles regarding artificial intelligence, outlining measures to protect artists’ rights. These include preventing the use of artists’ work to train AI models without consent, removing AI-generated recordings trained on UMG content, safeguarding artist royalties from dilution by AI-generated music, and removing content that infringes on artists’ identities and publicity rights.

How does UMG’s investment in artist development contribute to its overall financial performance?

Universal Music Group Reports Slight Year-on-Year Revenue Increase

UMG’s Financial Performance: A Closer Look

Universal Music Group (UMG), the world’s leading music company, has announced a modest year-on-year revenue increase for the first half of 2025. While not a dramatic surge, the growth signals continued resilience in the face of evolving industry dynamics and economic uncertainties. This report details the key findings,contributing factors,and future outlook for the music giant. The financial results cover January 1st to June 30th, 2025.

Key Financial Highlights – H1 2025

Total Revenue: €8.04 billion,representing a 2.8% increase compared to €7.82 billion in the first half of 2024. This demonstrates sustained demand for music across various formats.

Digital revenue: Continues to dominate, accounting for 73.1% of total revenue. Streaming remains the primary driver, with subscription revenue showing consistent growth.

Physical Revenue: Experienced a slight decline, but remains a meaningful contributor, particularly in specific genres like vinyl.Vinyl sales continue to defy expectations,showcasing a resurgence in popularity.

Publishing Revenue: Increased by 6.5%, driven by strong performance in performance rights and synchronization revenue. this highlights the growing importance of music publishing in the overall revenue mix.

Adjusted EBITDA: Reached €1.89 billion, with an adjusted EBITDA margin of 23.5%. This indicates strong operational efficiency and profitability.

Drivers of Revenue Growth

Several factors contributed to UMG’s positive, albeit moderate, revenue growth:

  1. Streaming Dominance: The continued expansion of music streaming services (Spotify, Apple Music, Amazon Music, etc.) remains the cornerstone of UMG’s revenue. Increased subscriber numbers and higher average revenue per user (ARPU) are key drivers.
  2. Growth in Emerging Markets: UMG is actively expanding its presence in emerging markets like India, Latin America, and Africa, were music consumption is rapidly increasing. These regions offer significant growth potential.
  3. Successful Album Releases: Key artist releases from Taylor Swift, drake, and Billie Eilish contributed substantially to revenue during the reporting period.Strategic album rollouts and marketing campaigns played a crucial role.
  4. Music Publishing Strength: The increasing value of music copyrights and the growing demand for music in film, television, and advertising boosted publishing revenue. Synchronization licenses are becoming increasingly lucrative.
  5. Vinyl Revival: The ongoing resurgence of vinyl records provided a surprising boost to physical revenue, appealing to collectors and audiophiles.

Segment Performance Breakdown

Here’s a detailed look at how each of UMG’s segments performed:

Recorded Music: Revenue increased by 2.1% to €6.49 billion. Streaming revenue grew by 4.8%, offsetting declines in physical and download revenue.

Music Publishing: Revenue increased by 6.5% to €1.55 billion. Performance rights revenue grew by 7.2%, driven by increased usage of UMG’s catalogue.

UMG Nashville: Demonstrated strong performance, fueled by country music’s continued popularity and successful artist signings.

Impact of Artificial Intelligence (AI) on UMG

Universal Music Group is actively navigating the challenges and opportunities presented by Artificial Intelligence.

Copyright Protection: UMG has been vocal about protecting the rights of its artists and songwriters in the age of AI-generated music. They are actively working with technology companies to develop solutions that prevent copyright infringement.

AI-Powered Tools: UMG is exploring the use of AI-powered tools to enhance music creation, production, and marketing. These tools can help artists streamline their workflows and reach new audiences.

Licensing Agreements: UMG is negotiating licensing agreements with AI companies to ensure fair compensation for the use of its music in AI-generated content.

Future Outlook & Investment Strategies

UMG remains cautiously optimistic about its future prospects. The company is focused on:

Investing in Artist Development: Identifying and nurturing new talent remains a top priority.

expanding Global Reach: Continuing to expand its presence in emerging markets.

Leveraging Technology: Utilizing AI and other technologies to enhance its operations and create new revenue streams.

Strengthening Music Publishing: Investing in music publishing assets and maximizing the value of its catalog.

Exploring Web3 Opportunities: Investigating potential applications of blockchain technology and NFTs in the music industry.

Case Study: Taylor Swift’s “The tortured Poets Department” Impact

The release of Taylor Swift’s “The Tortured Poets Department” in April 2025 had a significant impact on UMG’s revenue. The album broke streaming records on Spotify and Apple Music, generating significant revenue for the company. The album’s success demonstrates the power of a major artist release to

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