Friday, December 18, 2020
A trend involving musicians selling their "beloved and extensive song catalogs" has begun to make its stride in the music industry. Bob Dylan recently sold the rights to his entire catalog for an estimated $300 million to $400 million. This has been coined as possibly the biggest acquisition of music publishing rights from a single songwriter. The catalog consists of more than 600 songs and a Nobel Prize in Literature.
Unlikely many artists, Bob Dylan owned most of his own songwriting copyrights. According to Marketwatch, the only likely competitor in value and influence would be the Beatles. Bob Dylan was nor the first nor the last artist to sell his catalog.
Last month, Stevie Nicks sold 80% of her rights to her songwriting catalog for a reported $100 million. Also, in August, Imagine Dragons sold their back catalog for over $100 million.
Hipgnosis Songs Fund, a British company that buys hit catalogs spent around $670 million in the months between March 2020 and September 2020 on multiple different catalogs consisting of more than 44,000 songs.
It appears Dolly Parton is thinking about jumping on the train as well.
Why the sudden surge? Many believe that "the Spotify effect" has a lot to do with it. Not only are older catalogs being played a lot more due to the easy access, it is not much easier to value music due to streaming revenues. Which also inherently makes these catalogs more profitable.
Also, under the current tax plan and low interest rates, now may be the best time for artists and musicians to sell their catalogs and maximize profit. The low interest rates are good for investors that may want to invest in catalogs to receive royalties. Further, many musicians are not making as much money as they normally would because COVID-19 has essentially cancelled touring.
One other great benefit is that musicians will not have to deal with their catalogs being fought over in court. With these clear transfers, it is clear who owns the rights and it is a great weight of their shoulders.
As an artist, songwriter, or musician, now may be the best time and possibly the only time for awhile in which it is more beneficial than a detriment to sell the rights to the catalogs that lead to such great fame and success.
See Nicole Lyn Pesce, 5 reasons musicians like Bob Dylan and Stevie Nicks are selling their song catalogs right now, Market Watch, December 16, 2020.
Special thanks to David S. Luber (Florida Probate Attorney) for bringing this article to my attention.