By Chris Castle

I was grateful to Hypebot for publishing my 2026 music‑industry predictions, which focused on the legal and structural pressures already reshaping the business. For regular readers, I’m reposting those predictions here—and adding a few more that follow directly from the policy work, regulatory engagement, and royalty‑system scrutiny we’ve been immersed in over the past year with the Artist Rights Institute. These additional observations are less about trend‑spotting and more about where the underlying legal and institutional logic appears to be heading next.

1. AI Copyright Litigation Will Move From Abstract Theory to Operational Discovery

In 2026, the center of gravity in AI‑copyright cases will shift toward discovery that exposes how models are trained, weighted, filtered, and monetized. Courts will increasingly treat AI systems as commercial products rather than research experiments, and discovery fights for the good of humanity…ahem…rather than summary judgment rhetoric. The result will be pressure on platforms to settle, license, or restructure before full disclosure occurs particularly since it’s becoming increasingly likely that every frontier AI lab as ripped off the world’s culture the old fashioned way—they stole it off the Internet.

The next round of AI copyright litigation will come from fans: As more deals are done with AI like the Disney/Sora deal, fans who use Sora or other AI to create separatable rights with AI (like new characters, new story lines) or even new universes with old story lines (like maybe new versions of the Luke/Darth/Hans/Leia arc in the Old West) will start to get the idea that their IP is…well…their IP. If it’s used without compensating them or getting their permission, that whole copyright thing is going to start to get real for them.

2. Streaming Platforms Will Face Structural Payola Scrutiny, Not Just Royalty Complaints

Minimum‑payment thresholds, bundled offerings, and “greater‑of” formulas will no longer be treated as isolated business choices. Regulators and courts will begin to examine how these mechanisms function together to shift risk onto artists while preserving platform margins. Antitrust, consumer‑protection, and unfair‑competition theories will increasingly converge around the same conduct. Due to Spotify’s market dominance and intimidation factor for majors and big to medium sized independent labels, these cases will have to come from independent artists.

3. The Copyright Office Will Approve a Conditional Redesignation of the MLC

Rather than granting an unconditional redesignation of the Mechanical Licensing Collective, the Copyright Office is likely to impose conditions tied to governance, transparency, and financial stewardship. This approach allows continuity for licensees while asserting supervisory authority grounded in the statute. The message will be clear: designation is provisional, not permanent.

Digital-Licensing-Coordinator-to-USCO-2-Sept-22-2025Download

4. The MLC’s Gundecked Investment Policy Will Be Unwound or Materially Rewritten

The practice of investing unmatched royalties as a pooled asset is becoming legally and politically indefensible. In 2026, expect the investment policy to be unwound or rewritten by new regulations to require pass‑through of gains, or strict capital‑preservation limits. Once framed as a fiduciary issue rather than a finance strategy, the current model cannot survive intact.

It’s also worth noting that the MLC’s investment portfolio has grown so large ($1.212 billion) that its investment income reported on its 2023 tax return has also grown to an amount in excess of its operating costs as measured by the administrative assessment paid by licensees.

5. An MLC Independent Royalty‑Accounting and Systems Review Will Become Inevitable

As part of a conditional redesignation, the Copyright Office may require an end‑to‑end operational review of the MLC by a top‑tier royalty‑accounting firm. Unlike a SOC report, such a review would examine whether matching, data logic, and distributions actually produce correct outcomes. Once completed, that analysis would shape litigation, policy reform, and future oversight.

6. Foreign CMOs Will Push Toward Licensee‑Pays Models

Outside the U.S., collective management organizations face rising technology costs and political scrutiny over compensation. In response, many will explore shifting more costs to licensees rather than members, reframing CMOs as infrastructure providers. Ironically, the U.S. MLC experiment may accelerate this trend abroad given the MLC’s rich salaries and vast resources for developing poorly implemented tech.

These developments are not speculative in the abstract. They follow from incentives already in motion, records already being built, and institutions increasingly unable to rely on deference alone.

7.  Environmental Harms of AI Become a Core Climate Issue

We will start to see the AI labs normalize the concept of private energy generation on a massive scale to support data centers built in current green spaces.  If they build or buy electric plants they do not intend to share.  This whole thing about they will build small nuclear reactors and sell excess back to the local grid is crazy—there won’t be any excess and what about their behavior over the last 25 years makes you think they’ll share a thing?

So some time after Los Angeles rezones Griffith Park commercial and sells the Greek Theater to Google for a new data center and private nuclear reactor and Facebook buys the Diablo Canyon reactor, the Music Industry Climate Collective will formally integrate AI’s ecological footprint into their national and international policy agendas. After mounting evidence of data‑center water depletion, aquifer stress, and grid destabilization — particularly in drought‑prone regions — climate coalitions will conceptually reclassify AI infrastructure as a high‑impact industrial activity.

This will become acute after people realize they cannot expect the state or federal government to require new state permitting regimes because of the overwhelming political influence of Big Tech in the form of AI Viceroy-for-Life David Sacks. (He’s not going anywhere in a post-Trump era.). This will lead to environmental‑justice litigation over siting decisions and pressure to require reporting of AI‑related energy, water, and land use.

8.  Criminal RICO Case Against StubHub and Affiliated Resale Networks

By late 2026, the Department of Justice brings a landmark criminal RICO indictment targeting StubHub‑linked reseller networks and individual reseller financiers for systemic ticketing fraud and money laundering. The enterprise theory alleges that major resellers, platform intermediaries, lenders, and bot‑operators coordinated to engage in wire fraud, market manipulation, speculative ticketing, and deceptive consumer practices at international scale. Prosecutors present evidence of an organized structure that used bots, fabricated scarcity, misrepresentation of seat availability, and price‑fixing algorithms to inflate profits.

This becomes the first major criminal RICO prosecution in the secondary‑ticketing economy and triggers parallel state‑level investigations and civil RICO suits. Public resellers like StubHub will face shareholder lawsuits and securities fraud allegations.

Just another bright sunshiny day.

[A version of this post first appeared on MusicTechPolicy]