--- title: "Tidal Cuts Off Royalties for AI-Generated Music but Won't Ban It" description: "The streaming service Tidal says that from mid-July it will stop paying royalties on tracks it identifies as fully AI-generated — tagging them rather than removing them. It's a pragmatic move to protect the pool of money that pays human artists, without taking on the job of banning AI music outright." category: "Tech" category_url: https://boursel.com/category/tech author: "Kenji Nakamura" published: 2026-06-29T21:43:40.000Z updated: 2026-06-29T21:43:40.000Z canonical: https://boursel.com/article/tidal-cuts-off-royalties-for-ai-generated-music-but-won-t-ban-it tags: ["tidal", "ai", "music", "streaming", "royalties", "tech"] --- # Tidal Cuts Off Royalties for AI-Generated Music but Won't Ban It The streaming service Tidal says that from mid-July it will stop paying royalties on tracks it identifies as fully AI-generated — tagging them rather than removing them. It's a pragmatic move to protect the pool of money that pays human artists, without taking on the job of banning AI music outright. Streaming services are starting to draw lines around AI music — and **Tidal** has picked a notable one. The platform said that **from July 15** it will **stop paying royalties** on tracks it identifies as **fully AI-generated**, label them with an **"AI" badge** for listeners, and bar them from earning payouts or direct-to-fan sales, [TechCrunch reported](https://techcrunch.com/2026/06/29/tidal-cracks-down-on-ai-music-by-cutting-off-monetization/). Crucially, it **won't remove** those tracks — only **demonetize** them. (It will, however, take down AI music that **impersonates** real artists' voices or likenesses.) Tidal called the policy a **"living document"** that could later extend to **partly** AI-made music, [per Music Business Worldwide](https://www.musicbusinessworldwide.com/tidal-to-tag-fully-ai-generated-music-and-block-it-from-earning-royalties/). ## The money problem behind it To see why this matters, you have to understand how streaming pays. Most services use a **pooled, pro-rata model**: they collect subscription and ad revenue, keep a cut (commonly around **30%**), and split the rest among rights-holders **by share of total streams**. Each play is worth a tiny fraction of a cent, and that per-stream value is just the **pool divided by all streams**. That's the vulnerability. When **cheap, mass-produced AI tracks** pour in and rack up streams — sometimes via fraudulent bot plays — they **enlarge the denominator**, siphoning money away from human artists. The scale is real: rival **Deezer** has said roughly **44% of the new tracks** uploaded to it each day are AI-generated, and that it has **demonetized a large majority** of streams on the AI tracks it flags. Demonetizing — rather than paying — removes the **financial incentive** to flood the platform. ## How Tidal's approach compares Streamers are converging on the problem but splitting on tactics. **Spotify** has emphasized **removing** large numbers of AI tracks and screening uploads; **Apple Music** and others have leaned toward **labeling** AI content. Tidal's bet is on **demonetization as the main lever** — keep the track, drop the money. The appeal: it sidesteps the hard, contested job of deciding exactly what counts as "AI" and avoids the free-speech optics of deletion, while still cutting the economic incentive to spam. ## The bigger fight This sits inside a much larger battle over **AI and music rights**. Record labels have **sued** leading AI-music startups over training their models on copyrighted songs, and the industry has been **split between litigation and licensing deals** — some majors striking partnerships to license catalogs to AI firms on their terms, others still fighting in court, with key rulings pending. (Specific settlements and case outcomes are evolving; treat them as a moving landscape.) Tidal itself is **majority-owned by Block**, the fintech company formerly known as Square, which bought control of the service in 2021 and later **dialed back** its investment. ## Why it matters For the **economics of streaming**, Tidal's move is a small but telling marker: platforms are trying to **protect the human-artist royalty pool** from AI dilution **without** banning AI music outright — a middle path that may become the template. For **AI-music makers**, it signals that the easy money from flooding platforms with synthetic tracks is getting harder to earn. The open question is whether **demonetization alone** deters bad actors, or just pushes the problem around. Either way, the era of streaming services treating all uploads — human or machine — as equally payable is ending. ## Sources - [Tidal cracks down on AI music by cutting off monetization](https://techcrunch.com/2026/06/29/tidal-cracks-down-on-ai-music-by-cutting-off-monetization/) - [Tidal to tag fully AI-generated music and block it from earning royalties](https://www.musicbusinessworldwide.com/tidal-to-tag-fully-ai-generated-music-and-block-it-from-earning-royalties/)