Tina Turner, Justin Bieber and Co. now sell their life’s work: that’s what’s behind it

The music industry is in a gold rush mood. The list of superstars selling their life’s work just keeps getting longer. Phil Collins, Bob Dylan, Bruce Springsteen and Tina Turner have already done it – soon to be joined by Pink Floyd, Justin Bieber and Dr. Join Dre. The amounts that the superstars collect for the rights to their world-famous anthems are astronomical: from a hundred million to half a billion dollars.

The fact that music rights are traded is not new. Recently, however, not only music labels have joined in, but also investment banks such as Goldman Sachs – or companies such as the British Hypgnosis, which do nothing more than trade music rights. They want to take advantage of the boom in the music industry, which had a record turnover of around $ 26 billion worldwide in 2021.

The reason is streaming, which has turned the industry upside down. Also from a financial point of view: bands and artists used to earn their money mainly with new songs in the form of CDs or downloads. In the beginning there was intensive promotion, then they went on tour with the new music. There was hardly any money to be made with early music.

Nowadays, artists collect a fixed amount per stream. While this is low at around half an inch, world stars quickly add up to millions – over years or even decades. Streaming now accounts for two-thirds of global industry revenue. The rise of social media such as Tiktok, where many videos with music are stored, is also ringing the cash registers.

With a successful number, the income remains high for a long time. “This continuity is attractive to investors,” explains Lorenz Haas, managing director of the trade association of Swiss music labels (Ifpi Switzerland). For example, if you analyze Justin Bieber’s current streaming data, you can calculate how much sales his songs will generate in the coming years. Haas is convinced: “An investment like this entails less risk than many other investments.”

The trend has not yet caught on in Swiss industry. Even the most famous female Swiss artists have too little reach to be of interest to financially strong investors. But what isn’t can still be. Lorenz Haas explains: “If music rights trading proves to be a successful model, it will also reach the smaller sales.”

Whether the trend will continue in this direction will become apparent in the coming years. Because without any work, even the lucrative music rights wouldn’t turn a profit, Haas warns: “It still takes the classic label work: marketing and promoting the artists to increase streaming revenue.”

But why do the superstars sell their music? According to Lorenz Haas, there are several reasons for this. With older musicians like Bob Dylan or Bruce Springsteen, it’s often about the legacy: “They sell so they and their heirs don’t have to deal with rights management anymore.” During the pandemic, rights sales were also a way to make up for the loss of live performance revenue.

Sometimes the trade in music rights also produces strange blossoms. Various British media reported about a Swedish couple who want to buy the rights to the Wham! song “Last Christmas”. The two are so annoyed by the song, which can be heard everywhere on the radio at Christmas, that they want to take it out of circulation.

They seek financial support through crowdfunding. Although more than $ 62,000 has already been raised, the venture is almost hopeless: the rights to the Wham! hit would be worth about 20 million francs – and the current owner, Warner Chappel Music, would also have to agree to a sale. (aargauerzeitung.ch)