Suno Loses GEMA Copyright Case, EU AI Act Rules Take Effect, KOMCA Allows AI-Assisted Works

How The Music Business Works - Issue #73

August 6, 2026

Welcome back to How the Music Business Works.

This week’s issue starts with AI, copyright, and the systems now being built around both. Suno has lost a copyright case brought by GEMA in Germany, while key EU AI Act rules on labeling, training transparency, and rightsholder opt-outs are now being enforced.

South Korea’s KOMCA has also updated its AI policy, allowing AI-assisted musical works to be registered while keeping fully machine-generated works outside copyright registration.

After that, we’re looking at streaming business results. Spotify has reached 300 million Premium subscribers, while Warner Music Group’s preliminary calendar Q2 numbers show continued growth in subscription streaming and music publishing.

The main stories follow.

Suno loses GEMA copyright lawsuit in Germany

AI music generator Suno has lost a copyright infringement lawsuit brought by German collecting society GEMA at the Munich Regional Court. GEMA alleged that Suno used, stored, and reproduced copyrighted music represented by the society to train its AI tool without a license or payment to rightsholders. Reuters reported that the court found Suno was not entitled to use the music and ordered the company to disclose revenue information and pay damages, though the amount has not yet been set. The ruling is a first-instance decision and can still be appealed. GEMA represents about 95,000 members in Germany and more than two million rightsholders worldwide. The case focused on playable music tracks, with GEMA arguing that Suno outputs were misleadingly similar to works including “Forever Young,” “Mambo No. 5,” and “Daddy Cool.” Suno said it is evaluating options, including an appeal, while defending parallel copyright claims elsewhere.

Key EU AI Act rules are now being enforced

Key EU AI Act rules are now being enforced, bringing new transparency, labeling, compliance, and regulatory powers into effect from August 2. For the music industry, one major requirement is that AI-generated or modified images, audio, video, and text must carry visible labels and machine-readable watermarks so platforms and users can detect AI content. General-purpose AI developers must also maintain technical documentation and publish summaries of the datasets used for training, a rule that could matter in disputes involving AI music models. The law also requires developers to establish policies that detect, respect, and enforce rightsholder opt-outs, meaning works carrying valid opt-out metadata cannot be used for EU-market training without a paid license. The rules come with potential fines and platform bans, and could accelerate pressure for licensed generative AI music models, as labels, publishers, collecting societies, and courts seek more transparency.

KOMCA allows AI-assisted works to register for copyright

South Korea’s Korea Music Copyright Association has reversed its earlier zero-tolerance AI policy and will now allow registration of AI-assisted musical works. KOMCA previously limited registration to works created entirely by humans, but its new policy distinguishes between works made with the help of AI and works generated entirely by machine. Fully machine-generated works remain excluded, while applicants using AI assistance must disclose that use in detail and keep materials that can verify the creative process and revision history. KOMCA says it may request supporting materials, and false reporting could lead to measures including suspension of royalty payments, recovery of improperly received amounts, disciplinary action, or termination of the trust agreement. The shift follows wider scrutiny of AI-assisted works in South Korea and growing international pressure around AI labeling, training transparency, and unauthorized use.

Spotify hits 300 million Premium subscribers in Q2

Spotify reached 300 million Premium subscribers in Q2 2026, adding seven million net paying users during the quarter and beating its guidance by one million. The company said Premium growth reflected year-over-year and quarter-over-quarter gains across all regions, helped by strong global promotional campaign intake. Spotify’s total monthly active users grew 12% year-over-year to 777 million, up 16 million from the prior quarter but one million below guidance. Quarterly revenue reached €4.777 billion, or about $5.56 billion, up 14% year-over-year, while Premium revenue grew 16% at constant currency. Spotify also posted €655 million, about $762 million, in operating income and reported an all-time high gross margin of 33.4%. Spotify said its twentieth-anniversary in-app experience drew nearly 100 million users in its first six days and helped drive its biggest single day of subscriber intake. They project 305 million Premium subscribers by the end of Q3.

Warner Music subscription streaming revenue grows 11% YoY

Warner Music Group released preliminary calendar Q2 figures showing total revenue up 9% year-over-year at constant currency to approximately $1.86 billion. The filing came shortly after the company announced that CFO and COO Armin Zerza had left for personal reasons, with WMG appearing to reassure investors that the departure was not tied to weak quarterly performance. Recorded Music revenue was estimated at about $1.488 billion, also up 9% at constant currency, while recorded music streaming revenue reached roughly $1.001 billion, up 10%. Subscription streaming revenue rose 11%, and ad-supported streaming revenue rose 8%, both at constant currency. Warner Chappell Music’s publishing revenue increased 11% to approximately $377 million, while publishing digital revenue rose 15%. WMG also estimated operating income of about $305 million and adjusted OIBDA of roughly $433 million, with full results scheduled to follow.

Random Ramblings:

• Olivia Rodrigo and LEGO are turning vinyl promo into a brick-by-brick treasure hunt.
• Country songs are taking up more room on the Hot 100, with newer names joining the run.
• Looking for your next read? Check out these dance music books.
• Think electronic music and saunas don’t go together? London seems to be testing that theory.