Universal Music Group has settled its widely publicised lawsuit against Udio, which last year accused the AI music generation platform of “unimaginable scales” of copyright infringement.

So what exactly has led to the two battling companies reaching an amicable settlement?

Well, it was speculated back in June that major labels, including UMG, were in talks with Udio – as well as Suno, another platform UMG sued in 2024 over alleged copyright infringement – to discuss potential licensing deals that would bring in fees and also include a small equity stake in the companies.

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Now, UMG and Udio have not only settled their differences, but announced plans to collaborate on a new music creation, consumption and streaming experience. Here’s what we know:

In a new statement shared publicly by UMG, it announced that both itself and Udio have laid out “industry-first strategic agreements”. The company says that in addition to the “compensatory legal settlement”, new licence agreements for recorded music and publishing will “provide further revenue opportunities for UMG artists and songwriters.”

“The new platform, which will be launched in 2026, will be powered by new cutting-edge generative AI technology that will be trained on authorised and licensed music,” reads the statement. “The new subscription service will transform the user engagement experience, creating a licensed and protected environment to customise, stream, and share music responsibly on the Udio platform.”

UMG is also the first company to enter into AI-related agreements with YouTube, TikTok, Meta, KDDI, KLAY Vision, BandLab, Soundlabs and Pro-Rata, among others. It also shares that Udio’s existing product will remain available to users during the transition period with “creations controlled within a walled garden and the service amended in multiple ways”.

Andrew Sanchez, Co-Founder & CEO of Udio, comments: “We couldn’t be more thrilled about this collaboration and the opportunity to work alongside UMG to redefine how AI empowers artists and fans.

“This moment brings to life everything we’ve been building toward – uniting AI and the music industry in a way that truly champions artists. Together, we’re building the technological and business landscape that will fundamentally expand what’s possible in music creation and engagement.”

Sir Lucian Grainge, Chairman and CEO of UMG, adds: “These new agreements with Udio demonstrate our commitment to do what’s right by our artists and songwriters, whether that means embracing new technologies, developing new business models, diversifying revenue streams or beyond.  We look forward to working with Andrew who shares our belief that together, we can foster a healthy commercial AI ecosystem in which artists, songwriters, music companies and technology companies can all flourish and create incredible experiences for fans.”

Find out more about Udio, and read the full statement from Universal Music Group.

The post Universal accused Udio of “unimaginable scales” of copyright infringement. That lawsuit’s just been settled – here’s what we know appeared first on MusicTech.