Universal Music Group is pressing streaming services to reconsider how they compensate music it describes as unethically generated with AI, while preparing to earn revenue from its own licensed AI partnerships. During its October 29 earnings call, chairman and CEO Lucian Grainge argued that industrial-scale AI content should not be compensated on the same basis as music that attracts lasting audience demand. His comments describe UMG’s negotiating position, rather than an industry-wide royalty rule already in force.

Grainge’s criticism focused on the way a shared streaming royalty pool can reward large volumes of content competing for listening time. UMG said undisclosed AI material and fraudulent consumption threaten both the listening experience and compensation for established creators. Those concerns should not be read as evidence that every AI-generated recording is fraudulent or unauthorized. The company is distinguishing uses it opposes from licensed products it is helping develop.

UMG also said it expects its AI partnerships to begin producing incremental revenue in fiscal 2027. Management identified new licensed service tiers, including Spotify’s planned AI offering, as potential sources of additional spending by existing listeners. That is a forward-looking expectation: the call did not establish guaranteed receipts for individual artists or disclose a universal formula for sharing AI income.

The discussion accompanied quarterly revenue of €3.394 billion, up 11.7% in constant currency, including the contribution from Downtown. Excluding Downtown, constant-currency revenue growth was 5.3%. Those distinctions matter when assessing the business: acquisition-driven growth, conventional streaming income and prospective AI revenue are separate components of UMG’s strategy.