Live Performance Royalties Grew 22%, Reflecting The Music Industry's Resilience

The music industry is at a critical juncture, as the rapid pace of technological innovation continues to reshape how music is created, distributed, and consumed. At the heart of this transformation lies generative artificial intelligence (AI), which is increasingly being integrated into music creation and monetization processes. While AI offers vast potential for innovation, it also presents significant challenges for copyright protection and creator compensation. As we reflect on the lessons of 2024 and look ahead to 2025, it is clear that policymakers and industry stakeholders must act swiftly to safeguard the rights of creators and ensure a fair, sustainable future for the music industry.

Generative AI has rapidly emerged as a transformative force in the music and audiovisual industries. In 2024, tools like Beatoven.ai and Suno.ai enabled users to generate full musical compositions with minimal input, making music creation more accessible than ever before. However, this rise in AI-driven content has raised serious concerns about copyright, as AI models often use existing works without proper authorization to train their algorithms. The potential financial implications of this rapid growth are staggering. By 2028, the market for AI-generated music and audiovisual content is expected to rise from €3 billion to €64 billion. Meanwhile, the revenues from AI services in both sectors are projected to reach €9 billion, up from just €0.3 billion today.

These staggering figures highlight the rapid expansion of AI-generated content presenting significant risks to traditional creators. By 2028, up to 24% of revenues from music creators and 21% from audiovisual creators could be at risk due to competition from AI-generated works. This underscores the urgent need for industry-wide collaboration to ensure that creators’ rights are preserved and that fair compensation systems are put in place. Without robust legal and regulatory frameworks, the rapid growth of AI-generated content could undermine the financial stability of the creators it aims to support.

While the rise of AI-generated content presents challenges, there are also positive developments to note. In 2024, global royalty collections grew by 7.6%, reaching €13.1 billion. Digital platforms have cemented their position as the leading source of income, accounting for 35% of total collections. At the same time, live and public performance royalties saw a remarkable 22% increase, reflecting the ongoing resilience of the music industry. These trends highlight the continued value of intellectual property and the importance of protecting creator compensation in an increasingly digital-first world.

Cross-border collaborations, such as the KOLAB Indo-Korean music initiative, demonstrate the potential for international partnerships to fuel innovation. These collaborations underscore the need for a unified global framework to protect creators’ intellectual property. As more international projects emerge, the industry will require stronger, more consistent copyright protections to ensure that creators from all regions benefit from these collaborations and that their works are fairly compensated.

Looking to 2025, the challenge of generative AI will only intensify. Policymakers must prioritize the development of clear, comprehensive regulations around the use of AI in music creation. These regulations must ensure that AI companies respect existing copyright laws and that creators are compensated fairly for the use of their works. Recent lawsuits involving AI companies using copyrighted materials without authorization have underscored the urgency of addressing these issues. As these cases set legal precedents, future copyright frameworks will need to adapt and incorporate lessons learned.

To address these challenges, rights management organizations will likely increase their adoption of advanced technologies such as automated recognition systems. These tools offer a promising path forward for managing copyrights, ensuring transparency, and protecting creators’ rights in the age of AI-generated content. By providing greater control over works and improving royalty distribution systems, these technologies will play a key role in ensuring creators are recognized and compensated for their contributions, whether the music was created by humans or AI systems.

The integration of AI in music production presents both challenges and opportunities for improving licensing and royalty distribution systems. AI-driven tools like Beatoven.ai and Suno.ai have enhanced creativity and efficiency, yet they also raise concerns about the devaluation of human artistry. While AI can streamline music recognition and tracking, ensuring fair compensation for creators, it could also lead to an oversaturation of low-quality music, displacing jobs and diminishing the cultural value of music. The industry must strike a balance by leveraging AI for innovation while safeguarding the integrity of human creativity. This balance is essential for maintaining both efficient processes and the cultural significance of music.

As AI continues to shape the music industry, the future of copyright will depend on developing sustainable revenue models that fairly compensate creators for both AI-generated and human-created works. With AI-based music services projected to generate €9 billion by 2028, it's essential for industry stakeholders to collaborate on licensing models that ensure AI doesn’t undermine traditional revenue streams but rather compliments them, providing new avenues for creators' income.

In conclusion, the evolving music copyright landscape requires a balanced approach. As AI reshapes the industry, it’s crucial for policymakers, creators, and rights organizations like the Indian Performing Right Society (IPRS) to work together to ensure fair compensation, protect creators’ rights, and adapt to new technological realities. IPRS remains committed to advocating for creator’s rights, ensuring that creators’ intellectual property is preserved in this rapidly changing environment.