A new report says the indies' best shot at AI licensing is open right now, and closing

Research firm Stvdio and Secretly Distribution published a 36-page report on September 2 called Independent Music 2026: The Fight for Music’s Infrastructure. Its central claim is that independent music has never held more market share and never owned less of the plumbing underneath it.

The number that opens the report is the good news. Independents account for 46.7% of global recorded music revenue, 35% of streaming consumption and 40% of album sales. Everything after that is about what happens to those numbers when somebody else owns the pipes.

What the report means by an erosion of independent distribution

A distributor is the company that gets your release onto Spotify, Apple Music and the rest, and collects the money that comes back. The report’s first chapter argues that most of the big independent ones are no longer independent.

It lists the 2026 deals in order. Universal closed its $775 million acquisition of Downtown, which brought FUGA, CD Baby and Songtrust with it. Warner acquired Revelator, a white label platform that quietly runs distribution and royalty accounting for hundreds of indie labels. DistroKid sold at a reported $2 billion valuation to private equity firm CVC Capital, moving data for around 2 million artists and an estimated 30% to 40% of all new music releases into new hands.

The conclusion is uncomfortable and specific: an artist can turn down a record deal, keep their masters and their publishing, call themselves DIY, and still upload through a distributor Universal owns.

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Independent roots are being pulled up, replaced with major label pipes at almost every layer of the stack, while AI prepares to rewrite music's next royalty system.

Darius Van Arman of Secretly Distribution puts the risk in the report as a market that over concentrates until the biggest companies gain the necessary leverage to be able to rewrite the rules for other market participants.

Why the report calls AI licensing the indies’ opening rather than their threat

Chapter two is the one worth your time, and it scores AI licensing as medium risk and high opportunity. The argument is that Suno and the majors have both taken positions independents should not want to live under.

On one side, Suno argues training on unlicensed music is fair use. If that wins, the report says an artist’s life’s work goes into the machine with no attribution and no royalty.

On the other side, the major label deals are converging on walled gardens and remix tools, where music cannot leave the platform. The report points out the royalty flaw in that model: a drum and bass AI remix of Taylor Swift pays Taylor Swift, not the bedroom producer whose drum sounds helped train the remix model.

It also has a number that should make the majors uncomfortable. Udio’s website visitors dropped more than 60% after its major label deals were finalised, while Suno’s growth kept accelerating.

The ElevenLabs deal the report holds up as the working model

The middle path is not theoretical. ElevenLabs licensed training rights from Merlin, which represents thousands of independent labels, and from independent publisher Kobalt.

Those licences are opt-in. Artists and songwriters choose whether their work trains the model, and they share in the revenue if it does. Kobalt also got a most favored nation clause, which upgrades its terms automatically if the majors ever negotiate something better.

The result, per the report, is a fully licensed model with no legal overhang and no walled garden, which other products can build on top of.

Then comes the number that undercuts the optimism. Secretly Distribution offered that licence to all 100-plus of its label partners. Three labels and seven artists said yes.

Three open questions the report says independents could still answer

The report is honest that the rules are not written yet, and it names the gaps.

Attribution comes first. There is no agreed industry-wide way to measure how much a catalog influenced an AI model, or to turn that into usage reporting. Royalty distribution is second: the ElevenLabs agreement has early structures, but no public detail on the actual rates or how a per-use payout gets calculated.

Catalog participation is third, and it’s the one independents control on their own. Every label that opts in makes the licensed model better, which is the only thing that gives independents leverage over the infrastructure.

What an independent artist should take from this

The practical part of the report is chapter three, and it is not about lawsuits.

It documents indie collectives moving faster than usual: 24 labels investing together in the streaming app Cantilever through ORCA, Merlin buying Curve Royalty Systems with Jamen Capital to keep royalty infrastructure independent, Futures Music Group raising $6 million. It points at niche services growing where the giants cannot, with Qobuz at 1.2 million monthly active users and subscriber revenue up 45% in 2025, and Audiomack clocking 58 billion Afrobeats streams in Nigeria.

And it puts hard numbers behind owning your audience, naming Mitski, Japanese Breakfast, JVKE and BLOND:ISH, with tactics as ordinary as Instagram tour announcements, QR codes at the venue and a first-listen sign-up. Two of those campaigns converted more than 200,000 fans onto a mailing list.

That last section is the one you can act on this week, and it’s the same argument I keep making here: the fan you can email is the only part of this stack nobody can acquire out from under you.

Music Ally covered the report on publication, and it is available from Secretly Distribution.