Universal Music Group (UMG) has reached a settlement with AI music creation startup Udio, resolving copyright infringement claims and announcing a collaborative effort to develop a licensed AI music service. This partnership aims to create new AI-powered tools for music creation while protecting artists’ rights. UMG Chairman Sir Lucian Grainge stated that the move supports artists and embraces new technologies and revenue models. Udio CEO Andrew Sanchez emphasized that the partnership marks a transformation in music creation. The settlement comes after UMG, Sony Music, and Warner Records sued Udio and another AI firm, Suno, in 2024 for allegedly using copyrighted music to train their AI systems, risking harm to human musicians. While Udio claimed such use constitutes fair use, litigation continues with Sony and Warner still pursuing claims against Udio, and all three labels against Suno. This case adds to broader legal debates over AI training using copyrighted material without authorization. ([reuters.com](https://www.reuters.com/business/media-telecom/universal-music-settles-copyright-dispute-with-ai-firm-udio-2025-10-30/?utm_source=openai))
As part of the agreement, Udio has ceased allowing users to download AI-generated songs, leading to a backlash and subscription cancellations among users who felt betrayed. The collaboration marks the first such deal following Universal’s legal action against Udio and another AI platform, Suno, over imitation of classic songs. The new AI-powered subscription service, launching next year, will let fans remix music under artist-approved terms, but content will be kept within a controlled, non-downloadable environment. The development highlights the disruptive impact of AI in the $20 billion music streaming industry, intensifying debates around AI-generated content, artist rights, and music quality. Universal also announced a separate AI collaboration with Stability AI to create professional music tools. ([apnews.com](https://apnews.com/article/b90f9f5f968101ef617e41c5369da02a?utm_source=openai))
In June 2024, UMG, along with Sony Music Entertainment and Warner Records, filed lawsuits against Udio and Suno, accusing them of mass copyright infringement by using the labels’ recordings to train music-generating AI systems. The labels alleged that the AI companies copied hundreds of songs from some of the world’s most popular musicians to teach their systems to create music that would “directly compete with, cheapen, and ultimately drown out” human … . At the time, Suno and … . ([reuters.com](https://www.reuters.com/business/media-telecom/universal-music-settles-copyright-dispute-with-ai-firm-udio-2025-10-30/?utm_source=openai))
While UMG has settled its claims against Udio, the lawsuits filed by Sony Music and Warner Records against Udio, as well as the collective action against Suno, remain ongoing. This case adds to broader legal debates over AI training using copyrighted material without authorization. ([reuters.com](https://www.reuters.com/business/media-telecom/universal-music-settles-copyright-dispute-with-ai-firm-udio-2025-10-30/?utm_source=openai))
The settlement between UMG and Udio underscores the evolving relationship between the music industry and artificial intelligence. By collaborating on a licensed AI music service, both parties aim to harness the potential of AI in music creation while ensuring that artists’ rights are protected and new revenue streams are explored. ([reuters.com](https://www.reuters.com/business/media-telecom/universal-music-settles-copyright-dispute-with-ai-firm-udio-2025-10-30/?utm_source=openai))