What do Stevie Nicks, Bob Dylan, The Killers and Calvin Harris have in common? A clue: Neil Diamond joined them at the end of February.
The answer is, they’ve all made hundreds of millions of dollars by selling rights to their music.
The question I was asked is “why are they doing this?”. The answer is, the reasons vary. The pandemic has affected artists’ ability to earn money from touring, others might be looking to simplify their business affairs.
The real question is, why are companies willing to invest large sums of money buying music rights?
The answer to that? Music never dies.
In a world where tastes and technology are evolving faster than ever, music is a constant.
The shift from dumbphones to smartphones was driven at first by their ability to play music. Have you thrown out your CD player and radios? No problem because playing music is the number one use of smart-speakers. Global pandemic? We still play music. Geopolitical upheaval? We need music more than ever.
That is to say, music is a sound and stable investment. The delivery mechanisms may change, but the desire to consume music remains. That’s why companies are willing to pay serious money for music rights, they know music isn’t going anywhere.
If you own the publishing rights to a piece of music, you are entitled to some money every time someone streams the song, or it’s played on the radio, or seen on TikTok, or performed anywhere. The amount per play or performance may be small, but if you’ve got a lot of songs, and they’re getting a lot of plays it soon adds up. And owning the rights means you have a stable income stream for years ahead.
Then you can add in the money to be made for licensing the songs for use in adverts or movies.
That means it isn’t the one-hit wonders who are selling their music rights, it’s the artists who have created a huge back catalogue that are finding the value.
Look at The Killers. Mr Brightside has been a constant on the UK Spotify charts for 7 years! In their catalogue are songs for every occasion, rock tunes, anthems, ballads… even Christmas songs.
Neil Diamond may be best known now for Sweet Caroline, but he sold 60 years worth of music to get his undisclosed amount of money.
Calvin Harris has a mere 15 years worth of music to sell, but then he has written some of the best-selling songs of those 15 years, so his reported $100m is well-earned.
I can’t imagine a life in which music doesn’t play a big part. Every day at AVC Immedia we use music to create backdrops, atmosphere, and ultimately, feelings (and we pay for the rights to do so!).
We may use our expertise to fit the music together so that we create brand enhancing experiences, but we couldn’t do that without those songs and tunes that we use as the building blocks.
We’re realising the emotional value of the music, it’s only fair the creative artists get the benefit of the outstanding work they create.
Written by Euan McMorrow – Content Director at AVC Immedia.