UMG becomes the first major label to settle an AI lawsuit and launch a licensed AI music platform with Udio in 2026

Key Highlights:

• UMG and Udio settled lawsuit, launching licensed platform 2026
• Artists opt in and get paid for data use
• Udio stays active with better security and more credits

Universal Music Group became the first major label to turn a copyright lawsuit into an AI partnership. The UMG press release announced a settlement with Udio. The deal includes plans for a subscription platform launching in 2026. The platform will use licensed music training data. This changes the approach from the labels negotiating deals strategy that started earlier this year.

The agreement lets artists choose to participate. Artists who join will get paid for training data usage. They also get paid when subscribers create content using their music. Sir Lucian Grainge is UMG Chairman and CEO. He said, “These new agreements with Udio demonstrate our commitment to do what’s right by our artists and songwriters.” This ethical AI tools approach differs from past unauthorized scraping practices. Those practices led to the original lawsuit.

UMG’s partnership puts the label ahead of Sony and Warner. Those two labels are still suing both Udio and Suno. The Reuters report confirms this deal follows UMG’s pattern of AI collaborations. UMG has worked with YouTube, TikTok, and Meta. Meanwhile, indie class-action lawsuits from independent artists continue against both platforms.”

In June 2026, this settlement money became its own battleground. The musicians’ union AFM sued Universal and Warner, arguing the labels kept the Suno and Udio proceeds from the session players who appear on the licensed recordings.