NMPA Strikes 'First-Ever' Industry-Wide AI Music Licensing Deal With Udio, Plus Pact With KLAY
NMPA President David Israelite announced at the trade body's annual meeting in New York on June 10 that the organization had struck the first industry-wide AI licensing deal with Udio — notable for valuing compositions and sound recordings equally in AI training, which Israelite called a non-negotiable demand. An agreement in principle with a second platform, KLAY, was also revealed; KLAY had secured licenses from all three major labels in November 2025 before launching, which Israelite praised as the preferred model — 'permission before launch.' NMPA members can opt into the Udio deal from June 15, with KLAY's deal rolling out later this summer. The Udio agreement completes a remarkable transformation: the platform was sued by UMG, WMG, and Sony for 'mass infringement' in June 2024 and has since settled with UMG, WMG, Merlin, and Kobalt. Sony Music remains the sole major holdout.
THE BREAKDOWN
The NMPA's framing — 'licensing good AI partners and litigating bad actors is not in conflict' — is now the official two-track industry strategy, and every music manager should be able to articulate it to artist clients nervous about AI. For agents, any client with publishing rights should know that these opt-in licensing mechanisms represent new passive income streams from catalogs already being used in AI training. The KLAY model (licensing before launch) is the new industry-preferred template — agents should proactively flag which AI platforms haven't yet secured publisher deals, as those become the legal risk surfaces for clients. The Sony holdout is worth watching: their continued litigation signals either a more favorable deal in private negotiation or a strategic maximalist position for settlement leverage.
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