A few days ago, Pink Floyd became the latest to agree to sell their music catalogue, as well as their name and likeness, for around $400 million but the deal doesn’t include the rights to their songwriting. The deal came through after years of infighting between the surviving band members over the sale details as well as controversial comments made by the band’s co-founder and bassist, Roger Waters, like comments around Israel, Ukraine, Russia and the United States in a 2022 interview.
The group’s recorded music royalties are currently managed by two companies: Pink Floyd (1987) Limited and Pink Floyd Music Limited. The primary difference between the two companies is that the latter collects revenue for music recorded before Roger Waters’ departure in 1985, and the former collects revenues for music recorded after. According to Music Business Worldwide, the two companies generated a combined revenue of $50 million during the fiscal year that ended June 30, 2023.
Another one grabs a payday cheque
Pink Floyd is not the only group that has sold its catalogue. Earlier this year, Queen was reported to be inching closer to selling its catalogue to Sony Music for over $1 billion, according to Variety. The only revenue not covered in the deal is for live performances, which founding members Brian May and Roger Taylor, who still actively tour with singer Adam Lambert, will retain.
Queen’s music catalogue is among the most valuable of the rock era, containing classics like Bohemian Rhapsody, Another One Bites the Dust, Radio Ga Ga, Somebody to Love and You’re My Best Friend, besides stadium-shakers We Will Rock You and We Are the Champions. The success of the 2018 biopic Bohemian Rhapsody has displayed the popularity of the group among youngsters.
Between 1991 and 2017, Queen’s US sales and streaming activity totalled 25.9 million album consumption units, according to Luminate. In the three years leading up to the Bohemian Rhapsody film’s release, the group’s annual catalogue album consumption averaged about 752,000 units. When the film was released, the band’s album consumption unit count jumped to 2.074 million and in 2019, catalogue activity increased to nearly 3.58 million units.
According to financial reports from Queen Productions Limited, the band reported a net profit of £18 million on nearly £41 million in revenue for the year ended September 30, 2022. The company also reported £32.4 million in gross profit and £22.16 million after expenses but before taxes.
The Boss hits the cash register
Bruce Springsteen sold his song catalogue to Sony Music in a deal worth $500m in 2021, according to The New York Times. The sale included his recorded work and songwriting, giving Sony ownership of one of the most cherished bodies of work in pop and rock — over 300 songs spanning 20 studio albums plus other releases.
Highlights from his discography include his 1975 breakthrough Born to Run; the literary songwriting of his US number one, The River (1980); and the blockbuster sound of 1984’s Born in the USA, which went 15 times platinum in the US.
Dylan also has a deal
In 2022, Bob Dylan sold his back catalogue of recorded music to Sony Music Entertainment, as well as the rights to multiple future releases, in a deal rumoured to be worth between $150m and $200m, based on an estimate of $16 million in annual revenue around the world.
Bob Dylan
When Dylan sold his songwriting rights — which are separate from those for recordings — to Universal Music in late 2020, that deal was estimated to be worth well over $300 million.
Making his songwriting corpus valuable are the thousands of cover versions of his songs — from Peter, Paul & Mary in the 1960s to Adele.
The deal encompassed all Dylan recordings dating from 1962. The singer was signed to Columbia in October 1961, by its famed talent scout John Hammond.
Dylan said in a statement: “Columbia Records and Rob Stringer have been nothing but good to me for many, many years and a whole lot of records. I’m glad that all my recordings can stay where they belong.”
“I’m glad that all my recordings can stay where they belong,” Dylan added.
Et tu Stewart?
In February, Rod Stewart sold his song catalogue to Irving Azoff’s Iconic Artists for nearly $100 million in a deal that comprises interests in his publishing catalogue and recorded music, as well as some name and likeness rights.
The legendary singer said: “This year marks my 60th year in the music industry. The time is right, and I feel fortunate to have found partners in Irving and his team at Iconic that I can entrust with my life’s work and future musical legacy.”
Rod Stewart
Stewart is a two-time inductee into the Rock & Roll Hall of Fame, and has a number of hits over the years, including Do Ya Think I’m Sexy?, Sailing, The First Cut Is the Deepest, Hot Legs and Have I Told You Lately That I Love You.
Young cashes in
In 2021, Neil Young sold half of the rights to his song catalogue to Hipgnosis in a deal that comprises his entire song catalogue of hundreds of compositions. Hipgnosis took on 50 per cent of the worldwide copyright and income from the catalogue in exchange for an undisclosed cash sum. Hipgnosis Songs Fund was founded in 2018 by Merck Mercuriadis, who has previously managed artistes like Elton John, Guns N’ Roses and Beyoncé.
“I bought my first Neil Young album aged seven,” Mercuriadis said in a statement. “Harvest was my companion and I know every note, every word, every pause and silence intimately. Neil Young, or at least his music, has been my friend and constant ever since. Over the last 50 years that friendship took me back to Buffalo Springfield, Crosby, Stills, Nash & Young, Everybody Knows This Is Nowhere, After The Gold Rush, and guided me forward to On the Beach, Tonight’s the Night, Zuma, Comes a Time, Rust Never Sleeps, Trans, This Notes for You, Freedom, Ragged Glory, Greendale and through each successive album and on to last year’s Colorado.”
Shakira’s catalogue doesn’t lie
During the pandemic, Colombian singer Shakira sold the publishing rights to her catalogue to the London-based music royalties investment firm Hipgnosis. With more than 80 million album sales to her name, she sold the rights to her 145-song catalogue for an undisclosed sum in 2021. Her string of hits, which began with the release of her first album in 1991 at the age of 13, include Hips Don’t Lie, Whenever, Wherever and the 2010 Fifa World Cup song Waka Waka.
Justin Timberlake
“Being a songwriter is an accomplishment that I consider equal to and perhaps even greater than being a singer and an artist,” said Shakira. “At eight years old, long before I sang, I wrote to make sense of the world. I know Hipgnosis will be a great home for my catalogue.”
Even younger artistes like Justin Bieber
Two years ago, Justin Bieber sold his publishing and recorded music rights to Hipgnosis Songs Capital. The deal covered his entire back catalogue of 290 songs released before December 31, 2021. Hipgnosis picked up a 100 per cent interest in Bieber’s publishing copyrights (including his writer’s share), the musician’s share of the royalties from his master recordings (which are still owned by Universal Music Group), and even neighbouring rights (any time a song is played publicly — like at a coffee shop — “neighbouring rights” are paid to the owner of the recording). According to The Wall Street Journal, the deal was valued at around $200 million.
Include Memphis man Justin Timberlake
The singer handed over his song catalogue to Hipgnosis Song Management and a fund backed by the private equity firm Blackstone in a deal thought to be worth just over $100 million in 2022.
The deal gives the company full control and ownership over his interest in 200 songs he has written or co-written during his career with the boyband ’NSync and as a solo artiste. Merck Mercuriadis, founder and chief executive of Hipgnosis, said: “Justin Timberlake is not only one of the most influential artists of the last 20 years but he’s also one of the greatest songwriters of all time. His hit songs including Cry Me a River, Rock Your Body, SexyBack, My Love, What Goes Around… Comes Around, Suit & Tie, Mirrors and Can’t Stop the Feeling are amongst the most iconic of the period.”
Kiss goodbye
Earlier this year, American rock band Kiss sold their catalogue, brand name and IP to Swedish company Pophouse Entertainment Group in a deal estimated to be over $300 million.
The 2014 Rock and Roll Hall of Fame inductees thought it through before signing the deal. “We have always been breaking new ground in popular culture, and this partnership will ensure that we continue to do so for years to come,” Gene Simmons, bassist and co-founder of Kiss, said. “Because what Pophouse is doing, is breaking rules... The future could not be more exciting!”
Simon said…
In 2021, Sony Music Publishing picked up Paul Simon’s catalogue for an undisclosed amount, including his solo work and Simon & Garfunkel hits such as The Sound of Silence and Mrs. Robinson. The winner of 16 Grammy Awards said: “I’m pleased to have Sony Music Publishing be the custodian of my songs for the coming decades. I began my career at Columbia/Sony Records and it feels like a natural extension to be working with the Publishing side as well.”
Every song he made
Sting picked up his cheque in 2022 by selling his catalogue, which includes hits he made with the Police and as a solo artiste. Universal said that its music-publishing arm bought the catalogue, including Every Breath You Take, Roxanne and Fields of Gold. Sting continues to perform live concerts. In a statement issued by Universal Music Group, Sting said he wants his work used to connect with longtime fans in new ways and “to introduce my songs to new audiences, musicians and generations”.
Katy Perry
In the Nick of time
In late 2020, when the pandemic was raging, Fleetwood Mac star Stevie Nicks sold an 80 per cent stake in her music to Primary Wave for a reported $100 million. Soon after, her bandmates did the same: Hipgnosis acquired Lindsey Buckingham’s publishing rights across 161 songs in January 2021 and a week later it was announced Mick Fleetwood sold his entire recorded music catalogue to BMG. In 2021, Christine McVie sold her 115-song catalogue to Hipgnosis and in 2023, following her death, her estate sold her stake in Fleetwood Mac’s recorded music to HarbourView Equity Partners.
Perry’s Roar
Katy Perry sold her music rights to Litmus Music in 2023, with multiple sources pricing the deal at $225m. The sale covers all five albums Perry released for Capitol Records, from 2008’s One of the Boys to 2020’s Smile. Litmus now owns Perry’s stake in the master recordings and publishing for the records. In other words, it will collect future royalties that her music earns.
The idea behind such deals
As the music streaming market consolidates, musicians are finding it lucrative to sell their catalogues because tracks can be synced to advertising, or TV and movie soundtracks, to generate further revenue. Musicians may hold on to their catalogues to make more money in the long term but a huge cash payout while they are still alive is an attractive prospect, giving them and their estate a simple asset to deal with. Further, many of the artistes are selling their catalogues to companies they have longstanding ties to, like Springsteen has been with the Sony-owned Columbia Records since his debut album in 1973.
One has to understand that publishing rights usually stay with publishers and songwriters and recorded rights belong to labels and performers. Companies like Hipgnosis Songs Fund and Primary Wave are picking up all the music rights, so that these companies can reap money from royalties, licensing, brand deals, and other revenue streams that would have gone to the artiste. So why are Sony and Universal Music also buying? Simply put: Music industry’s traditional giants are putting up a fight.
Selling catalogues makes sense when it comes to taxes. A musician like Bob Dylan would continue to earn royalty if he hadn’t sold his catalgoue but it also means he would be paying in the 37 per cent tax bracket annually. A one-time multimillion-dollar payout with 20 per cent tax makes sense.
Further, music catalogues can be a complicated asset and the value keeps fluctuating. Selling catalogues can help with estate planning to take the burden off their heirs once they’re gone.
