Universal Music Group (UMG) and the AI music company Udio have reached a settlement that resolves their long‑running copyright infringement dispute and marks a turning point in how the music industry engages with AI. The agreement comes after UMG’s lawsuit alleged that Udio used UMG’s copyrighted sound recordings without authorization to train its AI music‑generation models. As part of the deal, the two companies will not only settle the legal claim but also collaborate on a licensed platform that uses AI‑generated music grounded in authorized material.

According to Pitchfork, under the terms of the settlement, Udio will compensate UMG for past uses of UMG’s repertoire in AI training, and a new licensing framework will ensure that UMG‑controlled sound recordings and publishing assets are properly used in the future. The deal creates a platform launching in 2026 where users can remix, mash up and customize music from UMG artists within a “walled‑garden” environment under control and opt‑in by the artists.

UMG CEO Lucian Grainge described the settlement as a demonstration of UMG’s commitment to embracing new technologies while protecting the rights of its artists and songwriters. At the same time, Udio’s CEO, Andrew Sanchez, called the partnership a “transformative moment” for music creation and engagement. The platform will allow creators to access licensed music, alter vocals, change tempo or swap voices of participating UMG artists, but it will be controlled so that all derivative outputs are traceable and artists are compensated.

With industry watchers closely examining how AI disrupts songwriting, performance rights, and revenue models, this deal between UMG and Udio may herald the first of many strategic agreements rather than purely defensive lawsuits.