Suno, one of many AI music era platforms dealing with authorized battles with copyright holders, introduced final Wednesday (November 19) that it had raised $250 million in a Sequence C funding spherical that valued the corporate at a jaw-dropping $2.45 billion.
The lead investor was Menlo Ventures, a long-running enterprise capital fund that helped fund quite a few identified tech manufacturers like Roku and Hotmail (earlier than it was acquired by Microsoft), and extra just lately turned its deal with AI corporations like Anthropic.
However one other, less-mentioned, investor might be of extra curiosity to the music enterprise – due to what its involvement means for the music business’s relationship with AI.
That investor is Hallwood Media, the music firm based in 2020 by Neil Jacobson, the previous President of Common Music Group’s Geffen Information.
In an Instagram put up printed over the weekend, Danny Jacobson, Hallwood’s Head of A&R, wrote: “Meet Hallwood Media Ventures (HMV). And should you’re not acquainted with SUNO, please meet one of the vital corporations in music (and the quickest rising software/workstation for Songwriters, Producers and Artists). We’re proud to have participated by their latest Sequence C spherical.”
Along with Managing Companions Todd Lowen and Neil Jacobson, Hallwood Media Ventures, the corporate’s funding arm, is led by just a few different UMG alumni, together with Common’s ex-CFO Chuck Ciongoli and ex-EVP Mike Biggane, who additionally served as Spotify’s Head of World Curation.
One other workforce member listed on Hallwood Media Ventures’ web site, who’ll be acquainted to many within the music business, is Paul Hourican, previously World Head of Music Operations at TikTok.
Merely put, Hallwood is staffed by some very well-connected music insiders – and the corporate is all in on AI-generated music. Earlier this yr, it established itself as a trailblazer within the legitimization of AI music throughout the business when it signed Imoliver to a file contract.
Why is {that a} large deal? As a result of Imoliver isn’t an artist – or a minimum of not the way in which most individuals would consider a music artist. He’s the most-streamed “music designer” (to make use of Hallwood’s time period) on Suno’s AI platform, who “makes use of the AI-powered platform to develop his lush sonic landscapes.”
“It’s an indication the business is able to embrace new concepts and new methods of making,” Imoliver mentioned. “This isn’t about changing artists, it’s about increasing what’s attainable.”
Maybe extra alarming to conventional artists is what Neil Jacobson needed to say concerning the deal.
“Imoliver represents the way forward for our medium,” Jacobson declared.
“Imoliver represents the way forward for our medium.”
Neil Jacobson, Hallwood Media
Those that worry AI is a risk to the music business can take some coronary heart in the truth that Imoliver – now a verified artist on Spotify – has to this point struggled to wow audiences within the broader music world like he did on Suno’s platform.
His label debut single, Stone, has clocked round 13,500 performs within the month it’s been out – far in need of the 3 million-plus performs it clocked on the Suno platform.
However one other Hallwood-signed act, the AI-generated Xania Monet, just lately turned the primary “AI-powered artist” to chart on considered one of Billboard’s airplay charts.
Each the Xania Monet avatar and her music are AI innovations, the work of Telisha “Nikki” Jones, who fed a poem she wrote into – you guessed it – Suno, and out got here How Was I Supposed To Know?, which went viral on TikTok earlier than it hit No. 1 on Billboard’s Digital Track Gross sales chart. It even reached No. 20 on the Sizzling R&B Songs chart, although it fell out of that chart in its second week.
Xania Monet now has 1.4 million month-to-month listeners in Spotify, the place How Was I Supposed To Know? has cracked 7 million streams.
In an interview with the Wall Road Journal, Jones defined that she used Suno to place her poem to music as a result of her singing voice, in her estimation, isn’t as much as the duty.
“I grew up singing in church, however I can’t do vocals as highly effective as what I created with Xania,” she mentioned.
On the again of her chart success, Jones scored a reported multi-million-dollar file deal. Who with?
Hallwood Media.
The response from some corners of music and media was swift and unequivocal.
In a put up on TikTok, singer Kehlani declared that “nobody will ever be capable to justify AI to me… I’m sorry, I don’t respect it.” The Guardian, in the meantime, described Xania Monet as “the newest digital nightmare to emerge from a hellscape of AI content material manufacturing.”
There’s additionally the truth that Suno is dealing with a number of copyright infringement lawsuits over its alleged use of copyrighted music to coach its AI fashions.
If the copyright holders are proper about that (they usually nearly actually are, on condition that Suno has just about admitted to utilizing copyrighted music with out authorization), then these Hallwood-signed artists have created music utilizing a expertise that ripped off different artists, with out credit score, permission, or fee.
In the meantime, AI music is starting to interrupt into the broader music scene.
As MBW reported earlier this yr, some AI “artists” are producing large numbers on streaming companies. Nation act Aventhis, with songs created by Suno and Riffusion, has round 1.3 million listeners on Spotify, whereas The Satan Inside has round 250,000 – down from 700,000 earlier this yr.
And there are many others. In an article printed on the finish of final month, Billboard counted six AI artists to have damaged onto its charts within the simply prior few months.
However the query stays: How giant is the marketplace for AI music? Hallwood is clearly betting that it’s giant sufficient to justify seven-figure file offers – and an funding in a legally questionable enterprise mannequin.
But on a latest earnings name, UMG Govt Vice-President and Chief Digital Officer Michael Nash mentioned the corporate’s analysis confirmed a restricted urge for food for AI-generated artists amongst listeners.
“The readout was 50% of music customers are very fascinated by AI in relationship to the music,” Nash mentioned.
“However that’s in relationship to their music expertise. The factor that ranks the bottom is artist simulation, what we’d name ‘pretend artists’. And also you’re seeing there’s an absence of traction round that apart from the occasional novelty phenomenon which will seize some headlines.
“That’s not what followers are fascinated by.”
“You’re seeing there’s an absence of traction round [AI artists] apart from the occasional novelty phenomenon which will seize some headlines. That’s not what followers are fascinated by.”
Michael Nash, Common Music Group
It could change into that AI-generated artists are only a “novelty phenomenon,” however one factor that seems to be right here to remain is the licensing of AI music mills.
In latest weeks, Udio settled its copyright lawsuits with each UMG and Warner Music Group, with each corporations placing licensing offers with the AI firm for a platform set to launch in 2026. Udio’s UMG announcement talked about that Udio will turn into a “walled backyard,” with its music shareable solely on the platform.
Given the latest investments and signings by Hallwood, it appears Suno isn’t headed in the identical path.
From one perspective, the latest licensing offers between main file corporations and AI platforms are an indication that AI builders are rising up, and at last deciding to do issues the official manner. However from one other perspective, we’re witnessing the legitimization of AI-generated music, and its induction into the music business correct.
Issues of human artists about AI aren’t more likely to go away anytime quickly.Music Enterprise Worldwide
