The Next Music Asset: How the NO FAKES Act Could Reshape Music Licensing, Investment and Commercialization in the AI Era

The NO FAKES Act has become one of the most important federal proposals addressing AI-generated replicas of a person’s voice and visual likeness. Since its April 2025 reintroduction in the 119th Congress, the revised NO FAKES Act (the Act) has continued to draw meaningful legislative attention and broad industry support. As of this writing, the U.S. Senate bill remains pending before the Senate Judiciary Committee, and the U.S. House companion remains pending before the House Judiciary Committee. Although the Act has not yet become law, the proposal underscores the unusual attention this issue has attracted because it sits at the intersection of AI, publicity rights, statutory enforcement and the commercial future of identity.

The Act is often discussed through the lens of deepfakes, AI-generated music and unauthorized voice cloning. Those concerns are real. But for the music industry, the more consequential question may be whether AI is accelerating the emergence of a new category of commercially valuable rights.

For decades, music transactions focused on copyrights in sound recordings and musical compositions. AI is forcing the industry to look beyond that framework and ask who owns, controls and can authorize the commercial exploitation of an artist’s voice, appearance and other identity attributes when those attributes can be replicated, modified and deployed at scale.

The long-term significance of the Act may therefore extend beyond enforcement. At a minimum, it reflects the growing importance of voice and likeness rights in an era where identity can be replicated, monetized and distributed globally with very little friction.

What Is the NO FAKES Act?

The Act would create a federal right to authorize the use of a digital replica of an individual’s voice or visual likeness. In practical terms, it targets highly realistic AI-generated or computer-generated replicas that are readily identifiable as a particular individual’s voice or visual likeness.

The Act is not simply a copyright bill, and it is not a general federal right of publicity in the broadest sense. Its focus is narrower: digital replicas. That distinction matters. A catalog owner may control a sound recording and a publisher may control a composition, but neither necessarily controls the performer’s voice or likeness for purposes of an AI-generated replica.

Historically, these issues have been addressed through a patchwork of state right of publicity and privacy laws. Those laws vary materially in scope, duration, remedies, transferability and postmortem protection. Tennessee’s ELVIS Act, which amended state law to address voice and likeness protections in the AI context, is an important state-level development and a direct reflection of how urgent these issues have become for the music industry. But state-by-state reform still leaves uncertainty for national platforms, distributors, artists and investors.

The NO FAKES Act is designed to create a more uniform federal framework. It would provide a cause of action against certain unauthorized uses of digital replicas while preserving space for news, documentary, public affairs, parody, criticism and other expressive uses. Like any legislation in this area, the difficult policy work lies in balancing identity protection against free speech and legitimate creative expression.

Although the Act is often discussed alongside the Digital Millennium Copyright Act, the two laws protect different rights. The DMCA protects copyright. The NO FAKES Act would protect a person’s voice and visual likeness against unauthorized digital replica uses. The connection is procedural: The Act incorporates a notice-and-takedown structure that resembles the way platforms already process copyright claims.

Where Things Stand Today

The most important practical point is that the Act has not yet become law. As of this writing, the 2025 Senate bill and House companion remain pending. Because of that, any article describing the Act should avoid suggesting that it is already enforceable or that it has resolved the many open questions around ownership, licensing, transferability and platform liability.

That said, the broader legislative environment has moved significantly. The U.S. Copyright Office’s 2024 report on digital replicas concluded that existing law does not provide sufficient redress for the speed, precision and scale of AI-generated replicas and recommended federal legislation. Separately, the TAKE IT DOWN Act created a federal framework for certain nonconsensual intimate deepfakes and platform takedown obligations. That law addresses a different category of harm, but it demonstrates that Congress is increasingly willing to impose targeted notice-and-removal obligations on platforms in response to AI-enabled abuse.

At the state level, activity has also continued beyond Tennessee. New York has enacted synthetic-performer advertising disclosure requirements and expanded its postmortem right of publicity to address vocal and visual digital replicas, underscoring that state-by-state developments are continuing even as Congress considers a federal framework.

The industry has also moved ahead of legislation. YouTube has publicly supported the NO FAKES Act and has expanded facial likeness-detection tools, first to certain public-facing categories such as government officials, political candidates and journalists, and later to adult users more broadly. Those tools concern facial likeness rather than voice replicas, but they are still important because they indicate where market practice is heading — toward identity-rights infrastructure that may begin to resemble parts of the copyright compliance ecosystem.

What the Act Could Mean for Platforms, Distributors and Technology Companies

If enacted, the Act would create potential liability for certain parties involved in unauthorized digital replicas, including parties that make unauthorized replicas available and certain services designed principally to facilitate unlawful replicas.

For large platforms, the practical impact may resemble existing copyright compliance frameworks, although the protected interest is different. Service providers should expect increased focus on notice intake, claimant verification, user response procedures, repeat-violation policies, escalation protocols and documentation.

Some of the most significant implications may fall on intermediaries within the music ecosystem, including self-service digital distributors, content ingestion platforms, social media platforms, creator tools and other services that sit between creators and audiences.

Standalone music distribution platforms occupy an important position in today’s music ecosystem, providing artists and rights holders with efficient access to digital services and audiences around the world. For distributors, DSPs and online services, the Act may be less about creating entirely new compliance functions and more about adding a new category of protected rights to existing rights-management frameworks.

The hard part will be that voice and likeness claims do not map neatly onto existing copyright workflows. A copyright claim asks who owns or controls a work. A digital replica claim may require a platform to evaluate whether a voice or visual likeness is readily identifiable, whether the use was authorized, whether an exception applies and whether the claimant is the proper person or representative to assert the claim. That is more fact-intensive than many routine copyright takedowns.

Compliance should therefore not be viewed solely as a risk-management exercise. Platforms that build reliable authorization, identity verification and licensed-replica workflows may be better positioned to participate in the authorized market that is likely to develop.

Beyond Enforcement: A Massive Commercial Opportunity

Much of the current conversation around the NO FAKES Act centers on enforcement. Over the longer term, commercialization may prove to be the more important development.

History suggests that the music industry rarely responds to new technologies through prohibition alone. More often, the industry develops commercial frameworks that permit innovation while creating new opportunities for rights holders to participate economically. Digital distribution, synchronization, sampling, streaming, user-generated content, short-form video, connected fitness and gaming all followed some version of this pattern. Each raised significant legal and commercial concerns at the outset. Each ultimately produced licensing structures, revenue models and market practices that allowed innovation and monetization to coexist.

AI music and digital replicas are likely to follow a similar path.

The Act does not prohibit AI-generated music or AI voice synthesis as such. It focuses on authorization and consent. To the extent AI-generated performances remain commercially attractive, the legislation could help facilitate a market for licensed uses of voices and likenesses rather than unauthorized ones.

That market may not look exactly like the market for copyrights. One important distinction is that the current proposal treats voice and likeness rights differently from freely assignable copyright assets, including placing restrictions on lifetime assignment and a greater emphasis on consent-based licensing. That distinction is critical. Voice and likeness rights may become commercially valuable assets, but they may be monetized principally through licenses, management rights, approvals and postmortem rights rather than outright ownership transfers during an artist’s lifetime.

Over time, the industry is likely to develop more standardized frameworks governing AI voice licensing, digital replica approvals, synthetic performance revenue participation, usage limitations, training restrictions, audit rights, crediting, revocation, moral rights-style controls and estate administration. The ultimate contours remain uncertain, but the direction of travel is clear: Identity-related rights are becoming a more important part of the commercial rights stack.

Implications for Catalog Acquisitions, Financing and Valuation

For investors, lenders and catalog acquirers, the most important implications may extend well beyond compliance.

Music transactions have historically focused on rights in sound recordings, musical compositions and related income streams. If AI-enabled exploitation becomes a meaningful commercial category, market participants will increasingly scrutinize who controls the rights necessary to authorize digital replicas and AI-driven uses of an artist’s identity.

One question that may become increasingly relevant is whether voice and likeness rights evolve into a distinct asset class that sits alongside traditional music rights.

It is too early to answer that question definitively. But buyers, sellers and lenders are likely to spend more time evaluating who controls these rights, whether they can be licensed or transferred, whether existing agreements address AI uses and whether future commercial opportunities are being captured or left outside the transaction perimeter.

Future diligence processes may expand to include questions such as:

• Who controls the artist’s voice and likeness rights?
• Are those rights assignable, licensable or subject to consent requirements?
• Do existing recording, publishing, management, merchandising, endorsement or estate agreements address AI-generated uses?
• Are there restrictions on digital replica exploitation?
• Have publicity rights been assigned, licensed, waived or otherwise encumbered?
• What rights survive an artist’s death, who controls them and for how long?
• Are there existing approvals, revocation rights or moral rights-style restrictions?
• Do prior licenses cover training, synthesis, modification, dubbing or localization?
• Does the transaction perimeter include, exclude or require cooperation with the individual artist or estate?

These questions are not academic. They may become increasingly relevant when evaluating future revenue opportunities, risk allocation, ownership structures and collateral packages.

Financing parties may also begin examining whether certain identity-related rights can support or enhance the value of a broader asset package. But lenders and buyers should be careful not to assume that these rights behave like copyrights. To the extent they are personal, consent-based, nonassignable or subject to postmortem control rules, they may require different diligence, control and enforcement assumptions.

The Act itself does not answer all of these questions. In many respects, it raises new ones. Nevertheless, it highlights the growing importance of understanding how identity-related rights fit within modern music transactions.

Practical Considerations for Industry Participants

While many details remain uncertain, industry participants should begin evaluating how the legislation and broader market developments could affect their businesses.

Artists, managers and estates should consider whether existing agreements adequately address AI-generated uses, voice cloning, digital replica rights, approvals, revocation rights and postmortem control.

Labels, publishers and rights owners should evaluate what rights they currently control, what rights they may need in the future and whether existing agreements appropriately allocate authority over AI-related exploitation.

Distributors, digital service providers and platforms should assess whether current onboarding, verification, content moderation and rights-management procedures are sufficient to address potential digital replica claims.

Technology companies should evaluate whether tools that generate, modify, localize or distribute synthetic voice or visual likeness content include adequate consent, provenance, documentation and takedown mechanisms.

Investors, lenders and catalog buyers should consider whether diligence processes need to expand to address publicity rights, voice rights and other identity-related considerations that may become increasingly relevant in future transactions.

Looking Ahead

The NO FAKES Act is unlikely to be the final word on AI and identity rights. Even if enacted, the legislation will almost certainly be followed by years of litigation, interpretation and market evolution. What seems increasingly clear, however, is that identity itself is becoming a more significant commercial asset in the digital economy.

The most important debates may ultimately have less to do with enforcement than ownership, control and monetization. Who has authority to authorize AI-generated performances? How should those rights be valued? Can they be licensed, financed or commercialized independently of traditional music rights? How should artists, estates, labels, publishers, platforms and investors share in the resulting economics?

The NO FAKES Act does not answer all of those questions. It does, however, signal that they are becoming increasingly important to artists, rights holders, technology companies, investors and the broader music industry.

For that reason alone, the legislation warrants close attention. Regardless of whether the current version ultimately becomes law, the issues it seeks to address are likely to remain at the forefront of the conversation surrounding AI, music rights and the future commercialization of identity.

 

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Sources and Attribution

• NO FAKES Act of 2025, H.R. 2794, 119th Cong. (introduced Apr. 9, 2025), U.S. Government Publishing Office / Congressional Bills; see also Congress.gov status pages for S.1367 and H.R.2794 (last reviewed July 6, 2026). GPO H.R.2794 text; Congress.gov S.1367; Congress.gov H.R.2794.
• U.S. Copyright Office, Copyright and Artificial Intelligence, Part 1: Digital Replicas (July 2024). Copyright Office report.
• 17 U.S.C. § 512 (DMCA notice-and-takedown / safe-harbor framework). 17 U.S.C. § 512.
• Tennessee ELVIS Act coverage, including Associated Press and Reuters reporting on the March 21, 2024 signing and the law’s focus on AI-related voice and likeness protection. Associated Press; Reuters.
• New York synthetic-performer advertising disclosure law and postmortem publicity-rights update. Reuters / Westlaw Today; Associated Press.
• TAKE IT DOWN Act, Pub. L. No. 119-12 (May 19, 2025); Congress.gov summary and status page for S.146. Congress.gov S.146.
• The YouTube Team, YouTube supports the NO FAKES Act: Protecting creators and viewers in the age of AI (Apr. 9, 2025). YouTube Blog.
• YouTube likeness-detection developments in 2026, including expansion to certain government officials, political candidates and journalists, and later expansion to adult users more broadly. These sources describe facial likeness detection, not voice-replica detection. Axios, Mar. 10, 2026; The Verge, May 15, 2026.