Selling Music Catalogues Becoming a New Trend
In January, Rolling Stone published an article about a new trend of artists selling their music catalogues to buyers like Primary Wave. What is causing this recent uptick in the music industry?
One of them is COVID-19. With concerts canceled and streaming services like Spotify dominating consumption of music, musicians are struggling to work, especially aging bands like Bob Dylan and David Crosby, whose concerts and touring makes up a significant portion of their revenue. This may give their songs the opportunity to have a second life, as TikTok and other viral videos have done.
For example, Stevie Nicks sold the rights to both Fleetwood Mac and her own solo portion of songs. Wall Street Journal reported she gave Primary Wave over 80% of the copyrighted material, which were an estimated value of $100 million. This purchase came on the heels of an unexpected comeback for Fleetwood Mac’s “Dreams,” when it was featured in a TikTok video of a man on a skateboard drinking cranberry juice casually listening to the song. The video, along with the song, soared so much in popularity that “Dreams” re-entered the Billboard 100 at number 21; the song had not been anywhere near the charts since 1977. And other artists seem to be following in her footsteps. In an article from The Guardian, Shakira became the most recent celebrity to sell music rights when she gave her entire 145-song collection, worth almost $80 million, to London-based Hipgnosis earlier this month.
“Being a songwriter is an accomplishment that I consider greater to and perhaps even greater than being a singer and an artist…I know Hipgnosis will be a great home for my catalogue,” she said, quoted in the article.
Speaking to Complex, Hipgnosis founder Merck Mercuriadis told the magazine about his desire to change the current industry’s publishing processes on it’s head by making songs their own business venture altogether. Formerly a manager for the likes of Elton John, Beyoncé, and songwriter The-Dream, Mercuridias’ approach to managing songs may seem peculiar at first. Who would want someone to own their entire music catalogue after years, even decades, of hard work? To answer the question, we need to see what Hypgnosis actually does with music rights and how they acquire them.
Back in the day, music publishing was done when a company, eager to use someone’s music for their projects (commercials, movie soundtracks, etc.), they would have to deal with the record labels representing the artist. In modern times, however, people are finding sometimes it is easier to deal with artists themselves rather than years of legal red tape with labels. And Hipgnosis is doing just that. Only buying from artists and producers controlling what happens to their material, the endgame is once they acquire a song, royalties are distributed to artists and investors. Mercuriadis believes, by doing this, he can show music is a lucrative entity like oil and gold.
“[But] music is much better than oil and gold because when something crazy happens in the marketplace…the price of gold and oil are all affected [and] great songs are always consumed,” said Mercuriadis.
When it comes to profiting off songs, he said it didn’t matter if he got 20% of the cut so as long as the artist still maintained popularity; In turn, this makes him popular. From rappers like Kanye West to rock stars like Motley Crue’s Nikki Sixx, they trust he will take great care of the music catalogues they put blood, sweat, and tears into. Time will tell whether music catalogues are the next big diamond mine discovery, but it might serve as a way to keep the lights on and pay bills until we can all sing together in concert venues once more.
DIASH 