Interesting article. The folly of these big catalogue acquisitions (from and investor standpoint) is indeed a head scratcher. These are by definition declining assets, with an occasional bump on a few songs from a licensing deal here or there. The big funds are blowing their investors $ on vanity purchases.
What about the children of these musicians? Can they not benefit from the royalties after their fathers or mothers have died? Can this not be assigned in a will?
All of this eventually becomes history. As I read, "I’d have to explain to a young music fan, who the King was." …I pondered my predicament of throwing light on who Al Jolson was.
Love seeing your Stanford MBA and the music fan in you combine for a well reasoned article. I agree - some of these royalty deals wont work out. The early ones look good because valuations rose but that will be fleeting
The only possible supplement to the Boomers’ (and post-Boomer) argument about their songs being somehow more enduring is via the biopic and/or documentary cleverly marketed toward millennials and younger demographics. To me this has proven to be a surprisingly enduring strategy to increase your audience and attention in the cultural/social media “conversation”.
As an example, take the success of the Bohemian Rhapsody biopic. This has translated into Queen being the 39th most popular global artist on Spotify (The Beatles are at 112). That is astonishing popularity to me.
If I controlled Elvis’ catalog (and just wanted to make money and didn’t care about quality) I would be pushing for a new biopic starring, say, Justin Bieber or one of the Chrises or whatever still popular youngish white dude. Get Taylor Swift to play Priscilla. Again, I am not advocating for this strategy, but I do believe it will be deployed with increasing frequency, just because all old pop culture IP must get re-booted. It’s the new streaming wars rule!
Also copyright laws can be rewritten, I wonder if it is the aim of these investors to lobby for further extensions to copyright, or to use the songs they've bought as evidence in court for the influence they've had on current music and demand a share in their sales by using AI analysis of songs to make their case. In short, is this a symptom of the malaise in the music industry or might it become the new model for it?
Your example of 1941 his is well taken; I was a sophomore in high school in 1971, "only" 30 years after 1941, and all of the 1941 hits were as old as the hills then. Now, in 2021, some of the finest work of all of the artists you mentioned above is 40 years old at a minimum.
Frankly, I am sick to death of most of that music, that is being used for every NNPD (Network News Prescription Drug) ad. If I were king of the world I'd lock up these chestnuts for 30 years and let them age in a vault before releasing them to the wild again.
That is not to say that I wouldn't sell out my OWN music for large sums of money. Of course I would, especially my song about outdoor lighting fixtures that I wrote for my autism spectrum son. :-) No bites on that yet though.
Ted, this is the best economic analysis of what is currently happening in the music business. And it makes me deeply grateful that I decided, some time ago, to be a completely non-commercial musician. I've always been more interested in the music than the money that can be made from the music.
I'd love to see a further exploration of your Twitter conversation yesterday regarding older music eclipsing new music in sales and streams (if true), and what that does mean for the culture at large. Fits very neatly into the narrative of decadence that others are writing about.
Thought-provoking article. Thanks Ted! It's hard to fathom why investors are paying such huge sums of money. But I think it's clear that it's a long-term investment that could pay off over decades. Probably, very few Americans had even heard of Nick Drake before Volkswagen used Pink Moon in immensely popular car commercials 25 years after his death. The Kinks were at a low ebb in popularity and almost no one beyond dedicated fans had heard the song Picture Book before it was used in a widely seen set of HP commercials. I don't know the answer, but the bet is that the investment will pay off in the long term (30-40 years), presumably before copyrights expire. I think someone else mentioned that the Beatles remain the world's most popular band (as measured in sales over a decade).
Interesting article. The folly of these big catalogue acquisitions (from and investor standpoint) is indeed a head scratcher. These are by definition declining assets, with an occasional bump on a few songs from a licensing deal here or there. The big funds are blowing their investors $ on vanity purchases.
What about the children of these musicians? Can they not benefit from the royalties after their fathers or mothers have died? Can this not be assigned in a will?
All of this eventually becomes history. As I read, "I’d have to explain to a young music fan, who the King was." …I pondered my predicament of throwing light on who Al Jolson was.
Enlightening foresight about future.
Do you think that music -in the sense we know up to the present- will no longer exist? Or will music be a side-job for part-time musicians?
I doubt that in the future the musicians will not be able to earn money they need to pursue music-only career
Love seeing your Stanford MBA and the music fan in you combine for a well reasoned article. I agree - some of these royalty deals wont work out. The early ones look good because valuations rose but that will be fleeting
The only possible supplement to the Boomers’ (and post-Boomer) argument about their songs being somehow more enduring is via the biopic and/or documentary cleverly marketed toward millennials and younger demographics. To me this has proven to be a surprisingly enduring strategy to increase your audience and attention in the cultural/social media “conversation”.
As an example, take the success of the Bohemian Rhapsody biopic. This has translated into Queen being the 39th most popular global artist on Spotify (The Beatles are at 112). That is astonishing popularity to me.
If I controlled Elvis’ catalog (and just wanted to make money and didn’t care about quality) I would be pushing for a new biopic starring, say, Justin Bieber or one of the Chrises or whatever still popular youngish white dude. Get Taylor Swift to play Priscilla. Again, I am not advocating for this strategy, but I do believe it will be deployed with increasing frequency, just because all old pop culture IP must get re-booted. It’s the new streaming wars rule!
Also copyright laws can be rewritten, I wonder if it is the aim of these investors to lobby for further extensions to copyright, or to use the songs they've bought as evidence in court for the influence they've had on current music and demand a share in their sales by using AI analysis of songs to make their case. In short, is this a symptom of the malaise in the music industry or might it become the new model for it?
Your example of 1941 his is well taken; I was a sophomore in high school in 1971, "only" 30 years after 1941, and all of the 1941 hits were as old as the hills then. Now, in 2021, some of the finest work of all of the artists you mentioned above is 40 years old at a minimum.
Frankly, I am sick to death of most of that music, that is being used for every NNPD (Network News Prescription Drug) ad. If I were king of the world I'd lock up these chestnuts for 30 years and let them age in a vault before releasing them to the wild again.
That is not to say that I wouldn't sell out my OWN music for large sums of money. Of course I would, especially my song about outdoor lighting fixtures that I wrote for my autism spectrum son. :-) No bites on that yet though.
Ted, this is the best economic analysis of what is currently happening in the music business. And it makes me deeply grateful that I decided, some time ago, to be a completely non-commercial musician. I've always been more interested in the music than the money that can be made from the music.
I'd love to see a further exploration of your Twitter conversation yesterday regarding older music eclipsing new music in sales and streams (if true), and what that does mean for the culture at large. Fits very neatly into the narrative of decadence that others are writing about.
Thought-provoking article. Thanks Ted! It's hard to fathom why investors are paying such huge sums of money. But I think it's clear that it's a long-term investment that could pay off over decades. Probably, very few Americans had even heard of Nick Drake before Volkswagen used Pink Moon in immensely popular car commercials 25 years after his death. The Kinks were at a low ebb in popularity and almost no one beyond dedicated fans had heard the song Picture Book before it was used in a widely seen set of HP commercials. I don't know the answer, but the bet is that the investment will pay off in the long term (30-40 years), presumably before copyrights expire. I think someone else mentioned that the Beatles remain the world's most popular band (as measured in sales over a decade).