From Desolation Row to Blowin’ In The Wind and Mr Tambourine Man, it’s impossible to put a price on the back catalogues of an artist as iconic as Bob Dylan. Except, with private enterprises and record companies recently stepping in to purchase back catalogues in their entirety, it seems you can put a price on such songs, or owning them at least.
This December, Universal Music stumped up a reported nine figures for Dylan’s back catalogue. The deal encompasses six decades of music from the Nobel Prize-winner and has been described by Universal as the “most significant music publishing agreement this century”. According to those close to it, the deal with Universal had been in talks for years, and Dylan had not approached other labels to ‘shop around’ his songs.
Record labels stand to profit by buying back catalogues and earning a revenue whenever a song is streamed, used in an advert or played on the radio. And Universal – valued at €30 billion in a stake sale last year – is not the only player in the game. The UK-based Hipgnosis Songs Fund raised £1.2 billion from investors with which to buy up old hits. To date, it owns 58,000 song rights, including works by Blondie, Wu-Tang Clan’s RZA, and Blink-182’s Tom DeLonge. It is estimated the company currently owns around a third of Spotify’s 30 most played songs of all time.
To musicians, these sales represent a significant windfall, but it’s a double-edged sword. Publishing rights were often held in reserve for times of dire financial emergency, or passed on to the next generation. So, what’s changed?
The answer is multi-pronged. To begin with, the advent of streaming services such as Spotify, while notorious for paying artists minuscule fees per song stream, has succeeded in bringing older music to a wider audience. Writing for the Financial Times, Nic Fildes explains that streaming services, alongside new social media platforms, are giving under appreciated songs a new audience, and hence, new value. Fildes points to the Fleetwood Mac song Dreams which has gained new popularity after being used in a viral video on Twitter and TikTok. The popularity of the tune, and new interest in the band, must be at least partly responsible for Stevie Nicks selling her song rights to a company called Primary Wave.
“With the advent of Spotify, 30 million records woke up and got a new life,” Amy Thomson, Kanye West’s former manager, told Fildes. “A lot of musicians will have no idea how rich they now are,” added Hartwig Masuch, chief executive of the German music rights company BMG Rights Management, which owns song rights by artists including Lenny Kravitz, The Rolling Stones and The Cranberries.
The second reason why so many artists are selling up is that, after decades of declines in CD sales and online piracy, off-loading your back catalogue is a sure-fire way to finally get paid.
According to Hignosis’ own calculations, for ever £1 generated through services such as Deezer, Spotify or Apple Music, 30p will go directly to the streaming service, 58.5p to the label and performer, and 11.5p to the publishing companies.
But, according to sources interviewed by the FT, the value of back catalogues has doubled since 2015 with investors seeing shares in companies like Hipgnosis as something to back. In other words, musicians can sell their catalogues for an up-front payment while companies like Hipgnosis gamble on recuperating that investment through song streams and other usage rights in video games, films and at sporting events, for example.
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