AI Music Startups Suno and Udio Seek Music Industry Partnerships After Copyright Battles

The AI song generator companies were sued by major record labels in 2024 but are now negotiating deals to join the industry they once angered.

Feb. 26, 2026 at 2:28am

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AI music platforms Suno and Udio were sued by major record labels in 2024 for allegedly exploiting the recorded works of professional musicians. Now, after their users have flooded the internet with millions of AI-generated songs, the leaders of Suno and Udio are trying to negotiate with record labels to secure a foothold in an industry that shunned them. The companies are striving to make peace with the industry, with Suno striking a settlement with Warner and Udio signing licensing agreements with Warner, Universal, and independent label Merlin. However, the music industry remains skeptical, with many professional musicians criticizing the AI companies for exploiting their intellectual property without transparency, consent, or payment.

Why it matters

The battle between the AI music startups and the music industry highlights the ongoing tension between technological innovation and the protection of intellectual property rights. As AI-generated music becomes more prevalent, the industry is grappling with how to balance the potential benefits of these technologies with the need to ensure fair compensation and recognition for the artists whose work is being used.

The details

Suno and Udio, two AI music generation startups, were sued by major record labels in 2024 for allegedly exploiting the recorded works of professional musicians without permission. The companies have since been working to negotiate deals with the industry, with Suno striking a settlement with Warner and Udio signing licensing agreements with Warner, Universal, and independent label Merlin. However, the music industry remains skeptical, with many professional musicians criticizing the AI companies for exploiting their intellectual property without transparency, consent, or payment.

  • In 2024, major record labels sued Suno and Udio for copyright infringement.
  • Last year, Suno struck a settlement with Warner Music.
  • Udio has signed licensing agreements with Warner Music, Universal Music, and independent label Merlin.

The players

Suno

An AI music generation startup founded in 2022, now valued at $2.45 billion.

Udio

An AI music generation startup founded in 2023, employing around 25 people.

Mikey Shulman

The co-founder and CEO of Suno.

Andrew Sanchez

The CEO of Udio.

Tift Merritt

A singer-songwriter and co-chair of the Artists Rights Alliance, who has helped organize a campaign by artists against AI music companies.

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What they’re saying

“Having a close relationship with the music industry is elemental to us. Users really want to have an anchor to their favorite artists. They want to have an anchor to their favorite songs.”

— Andrew Sanchez, CEO of Udio

“The economy of AI music is built totally on the intellectual property, globally, of musicians everywhere without transparency, consent, or payment. So, I know they value their intellectual property, but ours has been consumed in order to replace us.”

— Tift Merritt, Singer-songwriter and co-chair of the Artists Rights Alliance

“To the creative musician, AI represents both enormous potential benefits in terms of streamlining things and frankly making kinds of music-making possible that weren't possible before, and making it more accessible to people who want to make music.”

— Jonathan Wyner, Professor of music production and engineering at Berklee College of Music

What’s next

The lawsuits between the AI music startups and the major record labels are still ongoing in federal courts in Boston and New York. The outcome of these legal battles will likely shape the future relationship between the AI music industry and the traditional music industry.

The takeaway

The conflict between AI music startups and the music industry highlights the ongoing tension between technological innovation and the protection of intellectual property rights. As AI-generated music becomes more prevalent, finding a balance between the potential benefits of these technologies and ensuring fair compensation for artists will be crucial for the future of the music industry.