With live shows being put on pause, the oddities of the past few months have brought a ton of interesting obstacles to the music industry. However, high-profile producers, artists, and songwriters are cashing in their catalogs for big bucks. Among these are big names are Fleetwood Mac, Shakira & Neil Young.
Companies like Hipgnosis Song Fund and Primary Wave are dominating this new industry. By acquiring the rights to these artists' songs, companies get all the revenue from streaming, royalties, brand deals, and licensing: money that would have otherwise ended up in the artists’ pocket. While markets everywhere have fallen victim to the pandemic, these firms have realized the stable (and even growing) profit of music in the past months. Even during a period of global economic unrest and downfall, the consumption of music never stops.
But why are songwriters and artists selling?
Covid-19. While touring has been put on hold, artists (even massive names) are looking for other avenues of income. However, for artists like Bob Dylan who more than likely don’t need the cash there are a plethora of other factors, such as tax benefits, personal reasons and the high prices that are being paid due to a skyrocketing marketing value is simply too good to pass up (We’re talking about companies paying artists 14.7x annual historic income). These offers guarantee over 14 years of royalty fees in one guaranteed payment. The keyword being guaranteed. It can be hard for artists and producers to predict that their music will still be as popular, relevant, streamed, etc and this guarantees them the payout without taking into account these outside factors that might offset their earnings 14 years down the line.
At this point, you’re probably wondering how much money we’re talking about. To put it in perspective: in 2018, Bob Dylan sold rights to parts of his discography to Primary Wave. The bigger the artist, the more money they are guaranteed. Some of the purchases that occurred in the last year include;
Hipgnosis acquired the rights to Bon Jovi’s Richie Sambora, Blink-182’s Tom DeLonge, and the cofounders of Blondie and Mark Ronson.
Without her approval, Taylor Swift’s recorded rights were sold to Shamrock Capital by Scooter Braun, who purchased them from her old boss.
Valued at around $100 million, Stevie Nicks sold the majority of her publishing rights to Primary Wave.
Not far behind his bandmate, Mick Fleetwood sold his recorded music rights to BMG.
Another notable sale is investment company KKR acquiring the catalog of One Republic’s Ryan Tedder, who has previously written for Beyoncé and Adele.