Independent digital licensing agency Merlin has announced a partnership with AI music generation platform Udio, establishing a licensing framework for its member labels’ catalogues. The agreement will allow Udio to train new AI models using licensed music from participating Merlin members, with terms designed to compensate rights holders and incorporate protections for artists.
The deal marks one of the most significant formal agreements between a major AI music tool and a consortium of independent music companies. It follows a period of industry-wide legal disputes and negotiations over the use of copyrighted recordings in AI model training, positioning licensing as a central path forward.
Merlin, the global digital licensing agency representing a network of independent labels and distributors including Beggars Group, Secretly Group, and [PIAS], has been active on multiple strategic fronts.
The organization recently announced its board for the 2026-27 term, welcoming five new members including Bugwu Aneto-Okeke, Founder and CEO of Nigerian music services company M.A.D Solutions, a move that broadens its global governance perspective.
“As AI develops, it is critical to Merlin that we work with partners who respect artists, their work, and the requirement to license music,” said Charlie Lexton, CEO of Merlin. He noted that discussions with Udio have been focused on “consent and fair remuneration,” adding that the partnership illustrates Merlin’s commitment to “participating in shaping the opportunities AI promises, rather than simply reacting to its development.”
As AI Develops, It Is Critical To Merlin That We Work With Partners Who Respect Artists, Their Work, And The Requirement To License Music
Charlie Lexton, CEO of Merlin
Udio, a platform that allows users to generate songs from text prompts, is positioned by the partnership as a licensed counterpart to other AI music services currently facing litigation from major record companies and publishers.
The company’s CEO, Andrew Sanchez, emphasized the role of independent artists in the initiative.
“Independent artists are the driving force of this partnership,” Sanchez said. “By teaming up with Merlin, we’re ensuring they maintain control over their work and are compensated for their creativity. Together, we’re building a platform that gives fans and creators unmatched tools, real power and a deeper connection to the music they love.”
Together, We’re Building A Platform That Gives Fans And Creators Unmatched Tools, Real Power And A Deeper Connection To The Music They Love. We’re Not Just Imagining The Future Of Music Creation We’re Making Sure Independent Artists Are Helping Us Lead It
Andrew Sanchez, Co-Founder and CEO of Udio
The collaboration also aims to explore new forms of AI-assisted creative expression, though specifics of these planned tools or features were not detailed in the initial announcement. The move aligns with a growing segment of the industry seeking to establish commercial and ethical frameworks for generative AI, rather than pursuing solely litigious routes.
For Merlin’s member labels, the deal presents a potential new revenue stream and a structured approach to AI licensing. It also raises questions about how individual artists and rights holders will be consulted, how their music is opted-in, and how the partnership’s promised protections are implemented technically and contractually.
The agreement signals a continued bifurcation in the industry’s approach to AI. While major rights holders like Universal Music Group are engaged in lawsuits against AI firms such as Anthropic and Suno for alleged copyright infringement, partnerships like Merlin-Udio propose a licensed model.
