Suno, the quickly-emerging AI music platform, recently raised $250 million in a Series C funding round. That hefty investment raised its valuation to a whopping $2.4 billion! However, the company is now embroiled in legal disputes with two major music labels, Sony Music Entertainment and Universal Music Group. The lawsuits claim that Suno trained its AI systems on protected content owned by all of these labels – and potentially many others – without any licenses to do so.
It’s got the whole music industry buzzing. This latest wave of excitement comes on the heels of the viral success of a song produced using Suno’s cutting-edge technology. Telisha Jones, a 31-year-old from Mississippi, has created an R&B song from her spoken word poetry. She used the platform to title and promote the single, “How Was I Supposed To Know.” The song’s success has demonstrated the vast potential of AI technology to synthesize new music and sparked concern over copyright violations.
Suno’s AI persona, Xania Monet, has quickly become a heavyweight on the scene. Monet, in turn, received a handful of lucrative record deal offers. Ultimately, she made the decision to sign with Hallwood Media, scoring a contract valued at approximately $3 million. This development is a significant marker in the trend towards the intersection of artificial intelligence and the music industry. At the same time, legacy labels are raising a ruckus over IP.
In a similar song, music distribution platform Bandcamp announced its decision to prohibit the use of AI in the production of music and audio in September. Protecting our company’s vision is paramount. Most notably, it has pledged to ensure the legitimacy of the music it offers on its service. Bandcamp emphasized, “We want musicians to keep making music, and for fans to have confidence that the music they find on Bandcamp was created by humans.”
This ban is in stark contrast to the music industry’s current struggle with AI’s effects on their field. Drake’s drama around an AI-generated track with Tupac using Drake’s voice has certainly made a splash. This incident has led to a firestorm of conversation around the ethical use of AI in creative spaces.
Amanda Silberling is a senior TechCrunch rider who writes about the intersection of technology and culture. She stressed the harmful implications of these legal disputes on the future of AI-created music in light of recent news. She received her B.A. in English from the University of Pennsylvania. Further, she honed her professional acumen as a Princeton in Asia Fellow in Laos.
With revenues in the ballpark of $200 million reported, Suno’s final funding round of 2023 valued the company at an incredible $2.45 billion. This latest financial success is further evidence of the investor confidence in Suno’s business model amid continued ongoing legal battles. Now, some industry watchers are warning not to get ahead of oneself in valuing this company as liability from current and future lawsuits loom large.
A major tech company may have recently gotten their $1.5 billion slap on the wrist. This dismay is quite small potatoes for a company worth $183 billion. This new context deepens concerns about what the penalties might be. How will these penalties shape companies such as Suno as they begin to make sense of the tricky new AI music landscape?
Then, mark your calendars for TechCrunch’s next big shindig in San Francisco, occurring on October 13-15, 2026. Attendees will enjoy vibrant debates about AI’s effects on all sectors of life while giving particular focus to music.
