Spotify Technology SA announced a new licensing agreement with Universal Music Group that will allow the streaming service to offer AI-generated remixes and covers of songs to its premium subscribers. The deal sent Spotify shares surging 15% following the announcement.

The AI music creation tool will be available as a paid add-on feature for Premium subscribers, allowing users to prompt the creation of AI-generated remixes and covers of streaming songs. Artists will have the ability to opt out of the program, while those who participate will collect royalties from the AI-generated content.

The announcement comes alongside several other AI-powered features Spotify is rolling out. The company is launching AI-generated briefing and Q&A capabilities for podcasts, allowing users to generate daily or weekly summaries based on custom prompts. Additionally, Spotify is releasing an audiobook creation tool powered by ElevenLabs technology.

Spotify is also introducing a new desktop research application in more than 20 markets as a preview, though specific details about its functionality were not disclosed. The company announced plans to release new audiobook subscription plans later this year.

As part of its broader engagement strategy, Spotify said it will begin reserving concert tickets for top fans of artists. The company will monitor user activity including streams and shares to determine fan rankings and eligibility for reserved tickets.

The Universal Music Group partnership represents a significant development in the music industry's approach to AI-generated content, as major labels work to establish frameworks for artificial intelligence use while protecting artist rights and ensuring proper compensation.