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The AI Gold Rush has begun. Tech companies around the world are doing everything in their power to integrate artificial intelligence into their products. The music business is no exception. Leading the way is Spotify, which recently partnered with OpenAI to bring the company’s ubiquitous ChatGPT to the platform.
What does the world’s largest music streaming service want from an AI chatbot? Well, the answer is actually ingenious. Harness the world’s hottest AI, mix Spotify’s formidable music recommendation algorithms, bang on the AI voice generator, and you’ve got yourself a Spotify DJ. This is a tireless artificial disc jockey who never runs out of things to say and always knows what to ask.
This new feature, currently available in the US and Canada only, is sure to delight subscribers and corporate investors. But it could also inadvertently add fuel to a long-simmering battle that has plagued Spotify and major labels throughout the streaming era. Of course, we are talking about royalty payments.
To understand this issue, we have to look back at radio, the great grandpa of telecommunications. In the UK, when a song is played on the radio, the resulting royalties are split he 50/50 between the artist and the record label. This is due to a concept in English law known as ‘fair remuneration’. In contrast, if the same artist sells a physical album, the amount they receive is determined by the recording contract, most commonly with his 80% of royalties going to the label and the artist only 20% of hers. Not given.
Given this financial incentive, it’s no surprise that when streaming platforms first appeared, many major record labels argued they weren’t the same as radio. Warner Music, Universal Music Group, and Sony lobbied for a legal framework that would classify individual streams as sales, much like you would buy a record or CD. This clever trick allowed them to take the lion’s share of the profits.
This leads to Spotify’s DJ, a feature that almost exactly mimics the radio format. First, a song is selected. You can skip tracks you don’t want, something radio can’t do, but the ultimate goal is that you don’t have to. A key feature of algorithmically generated playlists is that track selection becomes increasingly seamless and requires less and less input from the user as the player learns about you.
Then there’s the digital host, which provides a stream of AI-generated yet incredibly human interactions. Modeled after the voice of Spotify’s head of partnerships, Xavier Jernigan, the DJ breaks up the listening experience by offering artist biographies and musical trivia.
All of this raises the following conundrum: Artists must earn a 50% royalty split if their song is played by a live DJ, but a 20% split if it is played by an artificial DJ. Why should I earn
And what about infinite radio stations that use machine learning to generate infinitely evolving songs on the fly? Aimi already offers that. The company recently launched a series of live Youtube streams. Each suits a particular mood. He can tune in and vibe out without fear of hearing the same song twice. The company’s mobile his app, currently in beta, is getting more advanced, allowing users to mix, match, and modify sounds in real time.
Thankfully, Aimi’s team makes it clear that their machine learning algorithms are “ethically and legally trained.” The company has worked with a group of artists including Max Cooper, Ian Pooley, I. Jordan, Hammer, Dam Swindle, DJ Minx, Object Blue and more. All were tasked with creating the raw materials needed to create this marvel of music.
However, other companies may not recognize the need for such ethical standards. Both the publishing and art worlds have been shaken in recent months as countless copyrighted images and texts were scraped from the internet and used as training data for generative AI applications like Midjourney and ChatGPT.
Do musicians also let their songs be sucked into algorithms without permission and used to generate endless replays? Almost certainly. What royalties, if any, are you entitled to? Nobody knows. Our legal system is still catching up with the technological breakthroughs of the 2010s, not to mention generative AI of the 2020s.

But payment issues are neither trivial nor speculative. A musician is one of the most economically vulnerable professions in society. His November 2022 survey by the UK-based charity Help Musicians found that 90% of the musicians surveyed had concerns about whether they would be able to get food in the next six months. I know you’re holding me.
At the same time, the music industry as a whole is experiencing seven consecutive years of economic growth, with a large portion of that growth coming from streaming. Universal Music, the world’s largest music company, said his group’s 2022 revenue was his $10.96 billion, up 21.6% year-on-year.
Of course, radio and music streaming are not the same. There are a number of structural, technical and economic differences that are evident. But it’s equally clear that playing a song on Apple Music or Tidal is very different from buying a record. The fact that it seeks to tackle this problem by applying legal concepts designed for terrestrial radio and physical album sales speaks volumes about how outdated music royalty regulations are. I’m here.
Campaigns such as Broken Record are drawing attention to this absurd situation and are lobbying for drastic reform. Among the many proposed changes, the group has called for streaming to be included in fair compensation laws that already cover radio and other public performances. The extent to which this solves the economic polarization of the music industry is debatable, but it is definitely a step in the right direction.
One thing that is indisputable is AI’s potential to reshape the creative industries. How music is made, how it is consumed, and who gets paid for it could be open questions in the years to come. Sooner or later, creators, lawyers and governments will want some answers.
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