Universal and Sony reject AI startup's distribution proposal, demanding generated music stay locked inside apps
Negotiations between major record labels and AI music startup Suno have broken down over fundamental disagreements about how AI-generated songs should exist in the world.
Universal Music Group and Sony Music rejected Suno's latest proposal for distributing AI-generated tracks, according to reporting today from the Financial Times. Universal demands that any AI-generated music remain locked within apps like Suno. No downloads, no uploads to Spotify, no TikTok soundtracks. Suno wants its users' creations to flow freely across platforms.
The companies disagree about whether AI-generated music deserves to exist alongside human-made songs in the same marketplaces. The breakdown comes as both sides face mounting pressure from investors worried about AI disruption on one side and ongoing copyright lawsuits on the other.
The timing matters. Last week, Udio announced distribution deals with independent labels. Stability Audio released its open-source music model. Meta's MusicGen continues improving. Every month without a deal pushes Suno further toward the unlicensed path that got them sued in the first place.
According to the Financial Times, the talks exposed major divisions about copyright payments and protections. The labels want guarantees that their catalogs won't be used for training, a particularly sensitive point given ongoing accusations that Suno trained its models on unlicensed music ripped from YouTube.
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The YouTube allegations add another layer. A recent analysis circulating on the platform details what creators call The SUNO Legal Mistake, pointing to evidence of stream-ripping from YouTube to build training datasets. The video highlights how independent artists' work may have been absorbed into these models without consent or compensation, a claim Suno has neither confirmed nor denied in court filings.
Universal's containment strategy shows their calculation. They're not trying to stop AI music. They're trying to prevent it from competing directly with their catalog.
But containment strategies rarely work in digital spaces. Users screenshot NFTs, download TikToks, screen-record everything. If someone generates a track they love on Suno, the technical barriers to sharing it are trivial. The legal barriers are what Universal hopes will matter.
Sony and Universal declined to provide comment to the Financial Times beyond confirming talks had stalled. Suno's proposal details aren't public, though sources suggest the company pushed for a revenue-sharing model similar to streaming platforms, a comparison the labels apparently found insulting.
Labels want AI music contained within apps, not distributed to streaming platforms. Suno needs legitimate distribution paths to avoid further copyright violations. Independent artists remain unprotected as their work gets absorbed into training data. The standoff pushes other AI music companies toward unlicensed creation. Investors are pressuring both sides.
The collapse leaves everyone in limbo. Suno faces ongoing lawsuits with no settlement path. Labels face an AI music ecosystem developing without their input or control. Artists watch their work get synthesized into models with no recourse. Users keep generating tracks, indifferent to the legal machinery grinding above them.