PPL Q4 Payouts Rise 19.9%, Spotify Addresses Scraping Incident, and Stability AI Sued Over AI Training - How The Music Business Works

How The Music Business Works - Issue #43

January 8, 2026

Happy New Year and welcome back to How the Music Business Works! We hope you had a restful and inspiring holiday break. As 2026 gets underway, the music industry is already moving fast, with fresh developments across streaming, AI, rights management, and global markets. 

This week’s coverage highlights some of the tensions and transformations carrying over into the new year. From rising international royalty flows and shifting revenue mixes, to growing pressure on AI companies around licensing, transparency, and data use, the balance between scale, access, and creator protection remains front and center. 

At the same time, new market data and regional perspectives show how differently these issues are playing out around the world, offering an early snapshot of the challenges and opportunities that may define 2026.

PPL’s royalty distributions jump 19.9% to $72.8M in final quarter of 2025

UK performers and recording rightsholders saw a strong end to 2025, as PPL reported a 19.9% year-on-year increase in Q4 payouts, driven largely by rising international collections. The CMO distributed £54.3 million ($72.8m) in its final payout of the year, up from £45.3m in Q4 2024. PPL credited improved repertoire data, expanded international partnerships, and back payments from several territories, including Germany, Sweden, Belgium, and the US. More than 147,000 performers and rightsholders received royalties, including 8,500 first-time payees, alongside £2.3m distributed via the Annual Supplementary Remuneration fund. Overall, PPL paid out £277.7 million in 2025, underscoring the growing importance of international royalty flows for UK performers and recording rightsholders.

Spotify says ‘anti-copyright extremists’ scraped its library

Spotify says it has identified and disabled user accounts involved in unlawful scraping after reports that a massive amount of Spotify metadata was released on pirate networks. According to Billboard, a pirate activist group claims to have accessed hundreds of millions of rows of track metadata and tens of millions of audio files, with metadata already published via Anna’s Archive. Spotify stated that the incident involved scraping of public metadata and illicit attempts to bypass DRM, not a user data breach, and that new safeguards have been implemented. While the immediate risk of Spotify “clones” is limited, the episode has raised fresh concerns about how large-scale music datasets could be repurposed for unlicensed AI training, potentially complicating ongoing licensing efforts between rightsholders and AI companies.

Musician Sues Stability AI for Training Despite Opt-Out Requests

A musician has filed a federal copyright infringement lawsuit against Stability AI, alleging his recordings were used for AI training without permission and in violation of an existing license. Darkwave artist Anders Manga claims his work was copied for AI training under a 2015 agreement that did not authorize such use and predated modern generative AI. The lawsuit, filed in North Carolina, also names Stability AI’s licensing partner Navarr Enterprises, alleging that opt-out requests were repeatedly denied despite public claims that artists could exclude their work from training datasets. Manga argues that copying full recordings for AI training constitutes a distinct commercial use that competes with human creators, highlighting a growing gap between AI companies’ public “artist-first” messaging and their underlying licensing practices.

Report: 56.9% of new independent songs in China are AI-generated

AI-generated music now makes up a majority of new independent releases in China, according to figures cited by People’s Daily. The outlet reports that 56.9% of independently released new songs in China in Q1 2025 were AI-generated, a sharp contrast to Western concern over similar trends highlighted last year by Deezer. Rather than framing this as a threat, People’s Daily presents AI as a growth driver for China’s music industry, pointing to widespread adoption of generative tools. It notes that Tencent Music’s AI music tools have been used by millions of creators, producing tens of millions of tracks with over a billion streams, signaling a far more optimistic official stance on AI’s role in music creation.

ERA: UK music streaming subscription income tops £2 billion in 2025 as vinyl sales surge by 18%

The latest interim figures from ERA show continued growth for UK music in 2025, driven by streaming and a renewed surge in physical formats. Total music revenues rose 4.2% year-on-year to a record £2.453bn, with streaming subscriptions topping £2bn for the first time, despite slower growth compared to 2024. Physical music outperformed expectations, growing 11.5% in value, led by strong vinyl sales, which helped physical formats reach 15% of total music revenues, their highest share since 2021. ERA said the results reflect sustained consumer demand and the combined impact of streaming platforms and retailers, reinforcing music’s role as a key growth driver within the wider UK entertainment economy.