2026.02.17 Daily Thread: The World According To Trade(Bait)

Today we venture into the music industry for something different. Most readers recognize that artists of songs receive royalties on sales of product, licenses, streams, etc. Right?

Then there is Artificial Intelligence, that ubholy term, a subject Wolf, Scott and others have chosen to explore at times. So, today is about what happens now with AI in music?

In particular, how do AI, bots, wire fraud, money laundering and all sorts of criminality play into it?

But first to set the tone, let’s review two scriptures of the day from both Old and New Testaments, which are from Proverbs 2:6,

For the Lord gives wisdom;
From His mouth come knowledge and understanding. (NASB)

And James 1:5,

But if any of you lacks wisdom, let him ask of God, who gives to all generously and without reproach, and it will be given to him. (NASB)

These two timeless scriptures tell the reader to look to the Lord for all knowledge, understanding and wisdom. For this time of existence that would tell the believer to test whatever knowledge one gains from the use of mankind’s AI against the Word of God.

That is a Word to the wise.

The Basics

it is worth a quick read below so you will know how it all works and why the changes are impacting the industry and the music you like.

https://royaltyexchange.com/blog/understanding-music-royalty-types-a-beginners-guide-2025

Once again, more strict and loose to discuss. The definitions,

Strict Constructionist – Literal and narrow reading (interpretation) of the document that limits the powers of the federal government to what it provides.

Loose Constructionist – Views it as a “living document” that is interpreted broadly that adapts to society as it evolves and its needs change..

When it comes to AI and music, you knew it would only be a matter of time until the below reared its head.

https://www.bbc.com/news/articles/cly3ld9wy3eo

More of the nitty gritty concerns from the artist and political perspective.

https://www.cbc.ca/news/entertainment/musicians-ai-bands-streaming-1.7581400

Did they say 75 million AI spam tracks in one sweep?! Holy shizola!

https://www.msn.com/en-us/technology/artificial-intelligence/spotify-s-ai-sweep-just-wiped-75m-tracks-and-creators-are-panicking/ar-AA1T7CDw

What can this all possibly mean going forward?

https://www.forbes.com/sites/virginieberger/2025/12/29/nine-predictions-for-the-music-industry-in-2026-how-ai-reshapes-licensing-and-power

One thing we do know is that ultimately the public will probably be the loser and we will regard those 45’s, 33’s, cassettes and VHS tapes as relics of a golden past that we long for again.

AI’s Legal Impact On The Music Industry

To answer this issue, let’s go to an AI horse itself. Here is Brave’s AI (Leo) response. The other couple AI’s I checked were similar in the responses.

The rise of AI in the music industry has created significant legal challenges, particularly around copyright and intellectual property rights. Here are the key legal implications:

Copyright and Training Data

The most contentious legal issue involves AI companies using copyrighted music to train their models without permission. Major record labels including Universal Music Group, Sony Music, and Warner Records have sued AI music synthesis companies Udio and Suno for allegedly committing mass copyright infringement, seeking damages of $150,000 per song used in training. This mirrors similar disputes in other creative industries and represents a fundamental challenge to how copyright law applies to AI development.

Royalty Fraud

AI has also enabled new forms of fraud. In a first-of-its-kind prosecution, a music producer was accused of using AI to create hundreds of thousands of fake songs with randomly generated artist names, then using bots to stream them on platforms like Spotify and Apple Music, allegedly fraudulently obtaining over $10 million in royalty payments.

Ownership of AI-Generated Works

A critical unresolved question is who owns the copyright to AI-generated music. In the UK, works generated by “computer” are currently protected by copyright, with ownership going to the person who makes the arrangements necessary for creation. However, the UK government has proposed removing copyright protection for computer-generated works, arguing they cannot satisfy the originality test that requires human intellectual creativity. US courts have similarly ruled that AI-generated content without human authorship cannot be copyrighted.

Voice Cloning and Deepfakes

AI-generated “deepfake” songs that mimic famous artists’ vocals pose new legal challenges around publicity rights and artist identity. The viral track “Heart on My Sleeve,” featuring AI clones of Drake and The Weeknd, accumulated 15 million TikTok views in under 48 hours. Tennessee responded by passing the ELVIS Act (Ensuring Likeness Voice and Image Security), the first US law specifically addressing AI’s impact on music, providing legal protections for artists’ voices and likenesses.

Industry Balance

Governments worldwide are struggling to balance encouraging AI innovation while protecting creators’ rights. The UK government’s December 2024 consultation proposed allowing free use of copyrighted material by AI developers with an opt-out option for creators, but this approach has faced strong opposition from the music industry, including high-profile artists like Sir Paul McCartney. The outcome of these policy debates will likely establish precedents affecting AI content creation across multiple industries.

Leo’s info sources were – pinsentmasons.com; unchainedmusic.io; saul.com; soundverse.ai; npr.org; cardozoaelj.com; joneswalker.com; whatnext.law

Do you see the problems here? There are many existing laws covering various aspects, but none that are comprehensively covering a completely new industry that was obviously not envisioned when the Constitution and related laws over the next 245+ years were passed.

As a result there will be strict constructionist interpretation in settled law areas to go with loose constructionist interpretations where no applicable statutory or case law exists. Now add the challenge of meshing both under one umbrella covering just the AI related industry with just license and copyright law in music. Because the music industry is international in scope, some consideration has to also be given to those legal issues and requirements in foreign countries. Now factor which businesses and performers align with specific points of emphasis, legal positions and political parties.

Can you spell “billable hours” and many, many lawsuits that will take ages to flesh out?

😂

Mamas let your babies grow up to be lawyers? Say it ain’t so…

AI Comedy

Let’s finish with some AI comedy since Wolf has been bringing the AI music. It’s worth your short time investment in my opinion. 🤣

AI can be fun if one knows it is AI. I am going to renege on not doing the AI music. Found one going around that is fascinating to listen to if you like Irish folk music. How about an Irish folk version of Billie Jean?

Back to reality.

Remember Wolf’s site rules. Note and label all AI. Please be kind to one another, we are all in this together. May God richly bless America and all of you.

Before all things and people – In God We Trust. Also, trust Trump and the plan.