UMG Deals and Generative AI in Music

Sunday Edition #22: Also, Amtrak, Lemons, and Revisions, Revisions, Revisions

Welcome to the Sunday Edition, where I share interesting articles and links alongside what I’ve been up to!

UMG Generative AI Deals

Two weeks, I was in a local cafe when I noticed a looping AI slop video on the screen showing classy jazz musicians singing. It’s then I realized it’s connected to the jazz fusion/blues that was coming over the speakers. When I shazamed the songs, nothing came up. It was AI generated music. I noticed that other patrons even started commenting on the music without realizing it was AI generated. It was a realization, that, especially in music, most people wouldn’t be able to tell the difference between genre generative AI and real genre music. I’m definitely not able to. If it wasn’t for the video, I would not have been the wiser.

So, it’s not a big surprise that the labels want their share of this. AI generated music is already topping Billboard charts.

UMG announced two generative AI deals. One with UDIO, settling litigation, and partnering on a creation, consumption, and streaming product and with Stability.ai for tools. Udio gets access to train their models on UMG’s catalogue. They are still deciding what music to utilize for training. Details on this matter is not clear yet.

CEO Andrew Sanchez of UMG said this in Rolling Stone:

“The vision is that you’re gonna be able to consume and interact with your favorite songs and artists in the same place,” Udio CEO Andrew Sanchez tells Rolling Stone. “I might wanna listen to songs that are made by my favorite band, and then maybe I wanna remix one. Or, ‘I’ve been listening to this band and this other band, I’m gonna mash ’em up together and then I might listen to those new songs as well.’” Sanchez calls it “a massive expansion… a paradigm that doesn’t exist right now” — part Spotify-like service, part creator platform, part social network. “We want to build a community of superfans around creation,” he adds. “As we say internally, it’s connection through creation.”

In trying to find reactions, an unexpected backlash comes from Udio users that have had their experience locked down because downloads had been disabled. So, Udio is turning more into a walled garden.

Now Universal and Udio are targeting 2026 for the launch of their joint platform, which will be a “walled garden” where no AI creations can be downloaded or posted outside of the site. The idea, according to UMG executive vice president and chief digital officer Michael Nash, is to avoid “direct cannibalization,” preventing the AI songs from competing with artists’ actual tracks on streaming, and making sure the platform generates entirely new revenue.

Being able to remix a song will be opt-in on part of the artist (but they don’t seem to have any say in their songs being used for training or not).

I did try to find more takes from musicians, but the response has been muted. I guess, a label creating a walled garden means that anyone training or using their work keeps it inside a controlled environment.

And, I think most musicians have already given up to some extent with the nature of music industry as it is today. For much of the generative AI slop, to me, it’s mostly felt as going from 1 to 10, not 0 to 1. The real threat and damage to creative industries came from the platform economies and generative AI just adds noise.

So, on the one side, I can see why people might see this as somewhat of a win, because at least, you know, the generative AI music will stay within a controlled environment. But, what bothers me more, is the lack of dynamism, or rather continuation of it. Part of the reason music is where it is, is that the major labels strong-armed the DSPs like Spotify in favour of the labels (and for that matter, the big artists). It just created a stronger power-law distribution. Conglomeration begets conglomeration. Now, the labels just become more powerful. What does this look like if Disney does the same? They then not only produce much of the media, but also any AI generated fan-fic is also owned/distributed by them. It’s always why the arguments for stronger copyright in the wake of generative AI felt scary. It’s not really going to get creators that much more compared to the power of mega corps consolidating power.

Lemons and Slop

Speaking of platform economies, this article highlights a problem, a race to the bottom, related to George Akerlof’s concept of a market for lemons.

The thinking goes like this: if a buyer can’t distinguish between good and bad, everything gets priced somewhere in the middle. If you’re selling junk, this is fantastic news—you’ll probably get paid more than your lemon is worth. If you’re selling a quality used car, this price is insultingly low. As a result, people with good cars leave the market to sell their stuff elsewhere, which pushes the overall quality and price down even further, until eventually all that’s left on the market are lemons.

He uses the example of shopping for sleeping masks.

I thought about this last week while shopping online for a sleep mask. Brands like MZOO, YFONG, WAOAW popped up, and these seemed less like companies and more like vowel smoke ejected from a factory flue hole, then slotted into a distribution platform. The long tail of generic brands on e-commerce platforms is a textbook lemons market: good products get drowned out by these alphabet soup products, who use their higher margins to buy sponsored placement in search results. Both buyers and sellers eventually lose (and perhaps the platforms win, as long as they don’t wear out their reputation).

Ultimately, the platform gets hijacked by performativity to the medium, where the incentive to hide information becomes valuable.

Instead, let’s zag and revisit my point earlier about system-gaming becoming the most viable playbook instead of focusing on the product. As a consumer and as a designer, I hope this is a temporary state before a massive recalibration. The primacy of meta-activities—optimizing for algorithms, visibility theater, consumer entrapment, externalization of costs, performative internal alignment, horse-trading amongst a set of DOA ideas—is poison. It is a road to nowhere worth going.

This happened everywhere online: from online dating to search. Having to play to meta activities to succeed.

I get his proposed solution, but I don’t fully agree:

The safest, smartest path is also the most mundane: keep the main thing the main thing. Outcomes matter, but output literally comes first. Outputs are the business to everyone outside it—what customers see, buy, and use. You can’t stay safe in abstractions forever. Eventually, you must attend to the reality of what’s in front of you, because that’s where work gets done and where assumptions get validated or falsified (because reality has a surprising amount of detail).

In other words, the meta ruins things for everyone. To hide in abstractions is to dodge the reality of your choices. These tactics may get you profit, but you sacrifice benefit. The climb may feel like progress, but at the end you’ll find yourself at the top of a mountain of lemons, perhaps not of your own making, but almost certainly of your own doing.

One of these meta activities is something you also see in general in systems. Once a system produces valuable output, people play to the form and aesthetics of the system, rather than its functions. It becomes primarily a LARP. Like, people buying fake luxury goods to signal perceptions of wealth.

Unfortunately, I don’t think we exist anymore in an information market where the good and best thing beats out the wide distribution of the okay thing. And platform economies are to blame. I’m a broken record on this (just see my previous newsletters), but the way out is to opt out of these distribution systems. I don’t think one consumer is going to make a big impact. But, I think people are recognizing the local fitness function trap, particularly in domains like social media. Authenticity beats slop and if people recognize how much “fast food” exists in our platform economies, they’d break off to fair trade and organic authenticity instead. But, as we’ve seen in markets like this, it was focused on the consumer that could afford more expensive food. Obesity kept rising, until recently… Which does make me wonder: what is the “ozempic” of this? It would be something that not just moves people away from distribution slop (losing weight), but also makes them prefer authenticity in general (losing weight turns into you preferring healthier options in general). With GLP-1s also changing people’s general cravings, maybe it *is* GLP-1s. (ht Rian)

Photo by arianka ibarra on Unsplash

Amtrak vs Shinkansen

Every time I look the NE US megalopolis corridor, I cry tiny tears at how much better its train system could be. Amtrak is fine, but man would it be wonderful to get to NYC in an 1h30 from DC. At that speed, it’s fast enough to even consider going for dinner in NYC after work and getting a later train back. Quico has a short article that juxtaposes it to Japanese trains (and airplane travel).

Amtrak takes a different approach. Somebody must have decided that since airlines are the Acela’s main competitor, the trick is to make the Acela experience as airline-like as possible. You see nods to this throughout the passenger journey.

I hadn’t realised this myself, but the design metaphor lands. I do wonder whether it will see increased ridership if it goes back to being more train-like (no lining up and more regular schedules). Due to the speed, it’s not really trips that people simply do last minute. There’s a sweet spot, though, that if it’s regular enough, it can be done like that. I’ve started taking far more DC public transport once they brought back automation on the tracks and the trains literally starting coming more regularly by a few minutes. It’s now short enough that I don’t have to plan for when the trains arrive. And that create huge induced demand by just crossing that threshold. There’s definitely a dream here where Randy Clarke, running WMATA, gets mega funding to build a dream project of regular high speed rail on the US East corridor. But, this is also America, uniquely hamstrung by its own culture of reduced appetite for mega public works projects and onerous regulations making these projects cost far too much money (#abundance). Maybe, one day. (ht VGR)

What I’ve Been Up To

I’m testing a new title design for the Sunday Edition. Feel like adding in Sunday Edition at the top is pointless. I thought I would have had more time to write regular essays, but alas not. So, keeping the focus on just publishing these roundups/essays as-is. Several years into writing this newsletter and I still don’t really know what I’m doing, except that I enjoy writing this every week. :)

✍️ Writing - Novel #2 Revisions

I’m not as far as I had hoped, but progress is continuing well regardless. The previous draft was 66,000 words which felt slightly on the low end, so I’ve also been taking the liberty to add some extra scenes. Hoping to finish this revision soon. Or, at least, send out a bunch of new query letters in the next week or two, as I work to complete this draft.

🕹️ Gaming - Hades 2

Haven’t had much time to game this week, but still enjoying adding in a run or two.

📺 Watching - Out of Africa

I know Robert Redford passed away this year and I realised I don’t think I’ve watched any of his classics. I enjoyed it. Meryl Streep’s performance is spectacular, and I was quite surprised to discover that this was actually all based on real-life events (yes, been living a bit under the rock on this). It was interesting to read the letterboxd reviews. “Out of all the Academy Award Best Picture winners I have seen, this is clearly the one that was released in 1985.” Which, yes, is true. Its depictions of Africa has not aged that well. But, I think that’s missing the point a bit. Not every film needs to be watched with the lens of 2025. To each their own.

👻 Halloween - Severance

I went as Mark S. from Severance this year. I enjoyed dressing up! Halloween in the US is always great. People are really into it here.

🏃‍♂️ Running - Tapering-ish

Definitely feeling fatigued as I’m hitting the peak of my training for Ultra Trail Cape Town. Learned to get my nutrition down for 3+ hour efforts, which I’m happy about. But, I’m stuck in a fatigue loop, where no matter what I do (protein, magnesium, anti-inflammatory), muscle soreness keeps me awake at night, which continues the loop of fatigue. So, I have to rest. So, starting the taper a bit sooner than planned.

🎶 Listening - Killen. - Mojo

Great dance track! :)

That’s it for this week folks. Hope you get to enjoy a lovely sunset.

Simon