But for many sectors — including the music industry — AI could fundamentally shatter the way some companies operate, and implode some lucrative revenue sources underpinning their dominance. "If AI is able to create the next hit song, then you've broken that model and that's an existential challenge for music labels, and for pop stars." In a recent note to clients, Morgan Stanley's Omar Sheikh noted that labels could charge for AI tools to use their creative material, or harness generative AI capabilities to craft music that resonates with or better targets certain audiences. The company's already begun experimenting with AI technology, recently debuting a DJ tool that personalizes and plays curated music. AI tools would allow music distribution platforms to cut costs and take advantage of cheaper and independent music generated by AI, said Credit Suisse's Douglas Mitchelson in a recent note.

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