The musicians have recently made the news for the huge deals they have made to sell the rights to their song catalogs. Selling the rights to their songs or the right to publish their music has many benefits for artists – especially in this era of a global pandemic where touring and merchandise sales have come to a complete halt. The sale of music catalogs has been a lucrative opportunity for songwriters over the past two years. Songwriters can receive immediate payment for their work rather than running the risk of their songs continuing to earn them money. Catalog buyers take the risk but can earn money through licenses, merchandise, and other opportunities to play songs.
The value of music catalogs is skyrocketing thanks to music streaming services like Spotify, Pandora and Apple Music. Licensing presents a particularly lucrative income opportunity for owners of song catalogs. A song that is featured on a popular show like “The Office” or “Grey’s Anatomy” can provide a steady income stream as these shows are replayed on online platforms, multiple broadcast and cable channels, and more. In addition, the sale of a music catalog has a number of important tax advantages.
Hipgnosis Songs Fund and Primary Wave are the two companies behind the recent wave of catalog sales and are changing the way the music industry operates. Traditionally, the rights to publish music remain with the publishers and songwriters, and the registered rights belong to the musician / performer and the record companies. But over the past year, these two companies have purchased the rights to catalogs from artists such as Neil Young, Stevie Nicks, Fleetwood Mac, Dire Straits, Shakira, John Lennon, Ryan Tedder, Bob Dylan, Bob Marley, 50 Cent, Nelly, and many more.
By purchasing the music catalogs, companies can now collect money from royalties, licenses, branding and other sources of income that would previously have gone to the artist. Hipgnosis had a huge year in 2020. The company bought the rights to the music from Richie Sambora, Mark Ronson, Jack Antonoff, Rick James, Barry Manilow, Blondie and Tom DeLonge. In November 2020, he purchased the publishing rights to 33,000 songs from Kobalt Music Copyrights, which included writers’ hits for Skillrex, 50 Cent, Nelly and Christina Perri. Imagine Dragons has sold its publishing rights for nine characters to Concord Music Group. Calvin Harris sold his catalog to Vine Alternative Investments. Scooter Braun sold the rights to Taylor Swift’s Big Machine catalog to Shamrock Capital (without his approval). The Killers sold their catalog to Connecticut-based investment group Eldridge. In December 2020, Stevie Knicks sold the majority of its catalog to Primary Wave.
Just days after Nicks sold his catalog, it was revealed that Bob Dylan had sold his catalog to Universal Music Group under an incredibly large contract. In early 2021, Neil Young sold half of his catalog of 1,180 songs to Hipgnosis. This company also reclaimed the publishing rights to Lindsey Buckingham and Shakira as well as the royalties from the producer of Jimmy Iovine within a week of the deal with Dylan. Mick Fleetwood has uploaded his music catalog to BMG. Ryan Tedder of One Republic has sold a controlling stake in his recorded music and publishing rights to investment firm KKR. Besides his work with One Republic, Tedder has written dozens of songs for dozens of artists including Beyonce, Adele, Timbaland, Kelly Clarkson, Demi Lovato, Colbie Caillat, Gavin DeGraw, Jennifer Hudson, and more.
Tedder’s deal in particular is interesting because of the buyer – it indicates that a whole new phase of music catalog acquisition is on the horizon with Wall Street companies stepping into the game.
Below is a list of the biggest music catalog sales of the past year (approximately). In many cases, the terms of the deals were not disclosed, but we are confident as to who got the biggest deal of all. Hipgnosis spent $ 700 million to acquire 42 catalogs just between March 2019 and March 2020 and $ 670 million from March 2020 to September 2020 for the rights to more than 44,000 songs. Basically everyone on this list has taken some serious cash.
Stevie Nicks – $ 100 million
Imagine Dragons – $ 100 million +
Neil Young – $ 150 million
Ryan Tedder – $ 200 million
Taylor Swift (Scooter Braun reaped the proceeds from this sale, not Swift) – $ 300 million
Bob Dylan – $ 400 million