Negotiations between the three major record labels and AI‑music start‑up Suno have stalled, revealing a split over how AI‑generated songs should be licensed. Universal Music and Sony have walked away from Suno’s proposal, while Warner Music only signed a deal last November. Sources say no substantive progress has been made since those talks began. Both sides cite copyright concerns and revenue splits.

Suno, valued at $2.45bn after last year’s funding round, boasts two million paying subscribers and lets users create tracks from text prompts in seconds. The impasse centers on distribution: Universal wants creations confined to its own apps, preventing internet‑wide sharing, whereas Suno pushes for broader user‑driven distribution. That disagreement has become the “major roadblock” in talks. Labels also fear dilution of artist brand value.

The deadlock arrives as label shares sit at three‑year lows and investors gauge whether AI will erode royalties or open new revenue streams. Earlier this year, the majors sued Suno and rival Udio for copyright infringement, prompting limited licensing pilots with other AI firms. Without a settlement, the industry risks prolonged litigation and uncertain monetisation of AI‑created music. Stakeholders will watch the outcome for clues.