The popular music streaming platform announced Thursday it has reached an agreement with Universal Music Group that will enable paying customers to generate artificial intelligence-powered song covers and remixes, representing the service’s initial foray into allowing user-generated AI content.
Following the announcement, the company’s stock price jumped approximately 16%.
Neither organization revealed monetary details of their partnership or specified which recording artists would be included in the upcoming feature during Thursday’s joint statement. Universal Music represents major performers such as Taylor Swift, Ariana Grande, Drake and Billie Eilish.
This development places the streaming service in more direct rivalry with emerging companies like Udio and Suno that offer AI-driven music production capabilities.
According to both companies, the upcoming feature will generate additional revenue streams for recording artists and composers beyond their current earnings from the platform, including royalty payments.
“What we’re building is grounded in consent, credit and compensation for the artists and songwriters that take part,” stated Spotify Co-CEO Alex Norström.
Leading recording companies have been pursuing fresh licensing agreements to protect their extensive music libraries as artificially generated music becomes more widespread and listeners find it increasingly difficult to distinguish from human-created compositions.
In the previous year, Udio negotiated agreements with UMG and Warner Music Group to resolve copyright disputes, while Suno achieved a settlement with WMG.
However, both AI music enterprises are currently defending against class action litigation from over 1,800 independent musicians, who claim the companies’ conduct “were an attack” on the music industry’s “most vulnerable and valuable members.”
The streaming platform has previously rolled out multiple AI-enhanced music discovery tools designed to increase user retention and participation, including voice capabilities for its customized music feature AI DJ and the ability to create playlists through natural-language requests.
