AI companies want access to music catalogs. That's not speculation. UMG and Warner have already signed licensing deals with Suno and Udio. All three majors licensed KLAY Vision for an AI music platform launching this year. ElevenLabs cut deals with Merlin and Kobalt. The money is moving, and the catalogs are following.
For independent artists and labels, this raises a question nobody used to ask when picking a distributor: what happens to my music after I upload it?
Most distributors don't answer that question. Their terms were written before AI was a factor, and they haven't been updated. There's no mention of AI training, no definition of what an "AI DSP" even is, and no controls for artists or labels to manage how their content interacts with AI platforms.
We decided not to wait for the industry to figure it out.
What We Built Into Our Terms
LabelGrid's Terms of Service define three things that most distribution agreements don't mention at all:
AI DSP — any platform that uses sound recordings, metadata, or other content for AI training, model development, synthetic media generation, or similar purposes.
AI Uses — ingestion, storage, reproduction, encoding, analysis, training, development, testing, fingerprinting, watermarking, content recognition, and similar technical uses required by an AI DSP.
AI-Generated Content — any content wholly or partially generated, synthesized, modified, or enhanced using AI or machine learning systems.
These aren't buried in legal footnotes. They're defined upfront in Section 2 of our TOS, alongside standard terms like "DSP" and "Your Content."
Your distribution license is also specific about what it covers. Section 5 limits our rights to delivering your content to the DSPs you select. No broad "any purpose" language. No "otherwise exploit" clauses. The license covers distribution. That's it.
How the Controls Work
Three rules govern how your content interacts with AI platforms on LabelGrid:
1. AI delivery is off by default. If we add AI DSPs to our delivery network in the future, they won't be enabled on your account. You have to turn them on yourself.
2. Auto-opt-in doesn't apply to AI. Even if you've enabled "automatically deliver to new DSPs," AI platforms are excluded from that setting. They require a separate, explicit opt-in.
3. You control it per release. Enable an AI DSP at label level? You can still exclude specific releases. The controls work at both label and release level, so you decide exactly which content goes where.
Compare that to a typical distribution agreement. Most use broad language like "for any purpose on or in connection with the Services" or "to otherwise exploit such content." That language was written for traditional distribution, but it doesn't specifically address AI. It doesn't give you any controls. And it doesn't define what an AI platform even is.
We're not saying other distributors are doing something wrong. We're saying the industry hasn't caught up yet, and artists shouldn't have to guess where they stand.
Why This Matters Right Now
The scale of AI in music has changed faster than most people realize.
Suno, the AI music generator, hit 2 million paid subscribers and $300 million in annual revenue as of February 2026. Its users generate 7 million songs per day. Udio, its main competitor, settled copyright lawsuits with both UMG and Warner and is now building licensed models with major label catalogs.
On the streaming side, Deezer reports that 39% of all daily music uploads are now AI-generated. That's 60,000 AI tracks landing on one platform every single day. Up to 85% of those AI music streams turn out to be fraudulent. Spotify removed 75 million spam tracks in 12 months, roughly matching its entire legitimate catalog.
The legal landscape is shifting just as fast. In November 2025, a German court ruled that OpenAI's ChatGPT infringed copyright by memorizing and reproducing song lyrics. That was the first court ruling globally to hold that AI training on copyrighted music is infringing. The European Commission opened an antitrust investigation into Google for potentially using YouTube content for AI training without proper consent or compensation. In the UK, more than 1,000 musicians released a silent album to protest proposed copyright changes that would have allowed AI training on their work. The government reversed course in March 2026.
On the regulatory front, the EU AI Act's bulk requirements take effect on August 2, 2026, with new transparency and copyright compliance obligations for AI providers. In the US, the NO FAKES Act (protecting voice and likeness from AI) was reintroduced in April 2025, and the proposed Blackburn AI framework would explicitly state that unauthorized AI training is not fair use under copyright law.
In this environment, "we'll figure it out later" isn't good enough. Artists and labels need to know, right now, how their distributor handles AI. Not vague promises. Not buried clauses. Specific definitions, specific controls, specific answers.
That's what we've built.
What Artists Are Telling Us
The concern is real. Surveys show 70% of creators want the ability to choose whether their music is used for AI training. 90% believe they should be compensated if it is. And 80% want AI-generated music clearly labeled so listeners can tell the difference.
Listener sentiment lines up. Deezer and Ipsos surveyed 9,000 people across 8 countries and found that 97% of listeners can't tell AI-generated music from human-made music in blind tests. 80% of them said they want AI music clearly labeled. iHeartRadio launched a "Guaranteed Human" branding campaign, and 96% of their listeners said they found the concept appealing.
The message is clear: people want transparency, and they want control. That applies to how music is made, how it's labeled, and how it's used.
We Welcome AI-Created Music Too
This isn't an anti-AI position. LabelGrid accepts AI-assisted and AI-generated music with clear disclosure requirements.
When you upload, you declare AI involvement at two levels: per-release (artwork) and per-track (audio). Three options: no AI used, AI-assisted, or AI-generated. That disclosure gets transmitted to every DSP automatically, aligned with Apple Music's Transparency Tags, Spotify's DDEX standard, and YouTube's policies.
The rules are simple: be honest about what you made. No impersonation, no deepfakes, no mass-produced AI spam. Original synthetic voices and AI production tools? Welcome.
87% of artists already use AI somewhere in their workflow, according to a 2025 LANDR study of over 1,200 music makers. Most use it for mastering, stem separation, or noise reduction. Some use it for composition or arrangement. A growing number use AI generators like Suno or Udio for parts, demos, or full tracks.
We think that's fine. AI is a tool. The question isn't whether artists should use it. The question is whether the platforms and distributors they work with give them the transparency and control they need.
We protect human-made music from unauthorized AI use. And we give AI creators a compliant path to distribute their work. Both can exist on the same platform, with the right controls.
Read the Fine Print (Ours Is Actually Clear)
Our full Terms of Service are at labelgrid.com/terms-of-service. Sections 2, 5, and 6 cover AI specifically. We wrote them to be readable, not just legally defensible.
If you want details on how AI disclosure works in practice, check our AI content guide.
And if you're currently distributing through a platform that hasn't addressed any of this? Read their terms. Ask the question. If the answer isn't clear, that tells you something.
