Spotify and Universal's AI Deal Explained

Welcome back to the podcast. Today we have huge news for those of you who uh do the Spotify streaming side hustles. Now, Spotify and Universal have struck a deal allowing fan made AI covers and remixes to be uh posted and I believe even monetized on Spotify. So this is huge. Um especially again like those of you who um

Jaden is huge on the his AI music streaming and AI podcasts. He does this every single day. He makes thousands of dollars of this per month. Use uh thousands of dollars doing this per month. And um so we're gonna get into this article today. Before we do, I wanna tell you about our school community. Uh this called AI Hustle. We'll link it in the description below. But uh this is where Jaden and I dive deep into all the different ways that we Actually are using AI to make money online.

And how you can too. So uh one of these pillars that we we always talk about is is streaming uh using AI generated content. And um so uh there's a whole strategy to it that Jaden will walk you through in this this course. We also have been deep into vibe coding and creating new apps and websites. Um and we cover that. Each week we release bonus content over there, uh really high value stuff, and we think you will really love being a part of our community.

Uh it's nineteen dollars a month and if you join today, it will be locked in at that price forever. So we'd love to see over there. But Jaden, why don't you tell us about the specifics of this new deal struck between Universal and

Okay. Well the thing that I love about that is uh there's a whole article in TechCrunch about this and they were just like, Watch out like Suno, like here comes Spotify and I think well first of all, I think this will be eventually a good competitor to Suno, which If you haven't tried it, Suno's a um a huge app that I use all the time, a premium subscriber to it.

um and have generated a ton of different music, done a lot of different projects with it, have posted music. I actually have an album that makes me um six hundred dollars a month. that I generated on Suno, relaxing piano music that I just labeled and posted. And uh yeah. And it it makes me six hundred bucks a month generated from Suno. So like I've done a lot here.

But what I will say is I don't think this this Spotify deal is going to go and kill Suno. I think Suno has a lot of really cool features. One of them being they have basically like a DOD, a digital audio workstation. um workspace where you can like basically generate a song, split it into different stems, and then modify all the different stems and generate different um uh instruments in there, right? So you like create a song and you can also do things where you upload yourself singing um and

And it can like add instruments in the background. Anyways, they do like a ton of really cool, very customized stuff. Suno isn't perfect, I will also say. Um, so I'm curious what what kind of quality Spotify comes out with. We've also just had eleven labs jump into this, and eleven labs is a new music generator, um, and a couple other players. I'm trying to remember someone else just came out with one. Um oh um

Yeah. There was one from Stable Diffusion or Stability AI. Uh they came out with a music generator, which I have been told is garbage, but it can make six minute long songs. So it can do longer songs. I think Eleven Labs, when they first came out, made thirty second songs. Now they can do full songs. Anyways. There's a lot of people and and there's Yu Dio too, which I haven't been a huge user of Yu Dio, but I hear it's pretty good. So

There's a lot of competition in this space. I think that's why it makes a lot of sense for Spotify to get in. Suno has a massive valuation, a massive user base. People absolutely love it. Um, the big problem that we saw with music generation and AI music generation from the very beginning was that a lot of people were making covers like, you know, Katy Perry sings XYZ or Snoop Dogg. Like they would go find a famous person and they would make them sing their song. And of course

then Katy Perry or Taylor Swift or whoever would get mad and there's like a lawsuit and then they go and sue like Suno or whatever music generation tool was used to make it because how dare you steal my likeness. Anyways, there's a whole bunch of um legal stuff that goes into all of that and Spotify because they already have licensing and a lot of deals with all these companies. I think they went and easily made one. And now you're gonna be able to make a cover.

of you know an actual artist that opts in. All these artists have to opt in by the way. So it's not like Spotify is doing this behind their back. But if you opt in, your fans can make covers using your voice and your style. And you as the artist will actually get paid a royalty for every stream, along with the person that created it. So there's actually, I think, a lot of um

a lot of opportunity to make music and covers of different artists and uh get paid if you get a lot of listens on that. I have no idea what the split is gonna be right now if you do a cover like traditional cover licensing, just so everybody knows, if you I haven't done this before, so I actually have a song. I'll pull up the stats for it. That'll be fun. Um I have a song that I got someone to make a cover of and i if I remember correctly it was like

Seven cents for every dollar I make in streaming revenue. The original artist gets seven cents or maybe 14 cents. I can't remember. Seven or fourteen cents. Um, so so that already exists. You just go get a cover license, it's cost fifteen dollars to get it on DistroKid or on Lander. So it's it's an easy thing that's already in the market. Um The thing that Spotify had to get permission for with on this deal was allowing you to clone an artist.

voice and style and make songs like that, which gives them a very unique edge because on Suno you cannot do this. And actually on a no one can do this right now. So if Spotify is able to do that, that would be Pretty crazy and you can make a lot of cool stuff. I don't know, Jamie. Would you make anything?

I mean I think I do think there's a lot of opportunity, especially, you know Right now the big thing in the past few years has been all the TikTok sounds basically. People will remix a song to fit their video and then that sound goes viral. I don't believe there's any royalty things right now, at least for artists, which there probably should be, but I think having access to the original artist and their their likeness is going to be

Yeah, I think people are gonna be able to make some really cool things. Now, as you had kinda mentioned, I don't know how complex the Spotify AI builder will actually be and what people will be able to do with it, but Um I think I think it's a cool idea. Um I think

There will definitely be some a lot of slop out there. Um so I hope that Spotify's user experience doesn't change too much with this, you know, because like let's say you're searching for a certain song and there's like two hundred and fifty remixes of it.

you know, I I hope it's still easy to find the original. Um, but I do like that the the artists are actually getting compensated for this. The original artists, I think it's a way to protect them and still allow, you know, artists to make money well at the same time. um people are able to, you know, use AI, create new new things and I don't know. I I do I think it's kind of it's an interesting business model. I don't I also I don't picture

random people making covers unless they're side hustlers and trying to make some money. So I don't think like your average person is gonna go remix songs for fun. Um I kind of think it'll go the way of Sora, uh, where it kind of flops and people don't actually but I think peop I think entrepreneurs will maybe make uh make some money doing this. But what what are your thoughts?

I think I think that we'll probab maybe even normal people. I don't know. I I think if there's a financial incentive, uh the market will grow and there's like a very clear streaming kind of financial incentive here. So something like Sora, that's a actually a really good point, right? Because with Sora you could make You could have like, I don't know, like Sam Altman in your video with you and and like the whole it was like an AI slop deep fake platform was like the whole point of it.

And uh yeah, it flopped. But there was you weren't getting paid anything. It was kind of for kicks and giggles. This, if you did make a high quality song that people like, which by the way, there have been a bunch of AI songs that have gone viral lately. Um most recently I saw like a friend had posted in her story um like a song. It was like anyways, and I was like, oh, this song sounds cool. And I clicked on it and I went and tried to find it. And then I'm like, wait, this is AI generated.

And uh I was blown away, but the the hook on it was really good that was like used in the story or whatever. And it was a trending sound on on Instagram and it was an AI generated song. So, anyways, I think that uh you can make really good stuff and

If there's a financial incentive, a lot more people will do it, right? Like if you can just go make songs like your favorite artist and you're gonna get paid like a thousand bucks a month, like people are gonna do it because you really can get paid that kind of money. Um, so anyways. I think that for that reason it will do better than Suno, but I think you make a good point that not everybody's is going to be high quality. So I'm curious to see how.

how that filter happens basically, right? Like I don't think if you go to Taylor Swift's uh Spotify page, you're gonna see everyone that's made a Taylor Swift cover'cause there's gonna be a a lot of slop. But there might be like, you know, like

20 or 30 people that make incredible covers. I mean, let's face it, Taylor Swift and most famous artists don't write all of their music. They buy music from other songwriters. All of those songwriters could just be going and creating these covers now with artists that they like. And uh I would predict that if any of these songs do well enough, any of the AI generated fan covers do good enough, the artist will actually go and cut a real record.

AI song, maybe spiff it up or change the lyrics a little bit. But like you can imagine if you had, you know, Post Malone going super viral for an AI generated song, why wouldn't he just go and like actually record the song, pay whoever came up with it like a little bit more?

and uh make it a real thing and maybe change the lyrics to be a little bit more personalized to him. But I don't know. I think I think it could be like almost a pipeline for finding new trending sounds that artists could go and cover and make a real real uh albums with.

Yeah, no that's interesting. And like we mentioned at the beginning, I I'm curious to see if it is like a full digital audio workspace like you mentioned, or is it just like a click to remix, you know, capabilities. I'm I'm curious to see what they roll out. Anyways, I uh I realized I gotta get onto my phone and authenticate some stuff to show my um

to show how much money I actually made from my cover music. But I will screenshot that after the episode and post it in the school community. If anyone's interested, I did uh I had a cover song that I paid a girl to sing a cover to a popular song, got over a million streams. I made a lot of money. So anyways, I'll screenshot that and put it over in the the school community uh for anyone that's

listening. You can go find it over there. All right, guys. Thank you so much for tuning into the podcast today. All sorts of incredible new ways to make money are coming out. Um if you're interested in learning more about how to do that, we would love to have you in our community and we hope you all have an incredible rest.