Neil Young has sold 50% of his 1,180-song catalogue
The Canadian icon is the latest musician to make this big move
Neil Young has sold a 50 per cent stake of his nearly 50-album and 1,180-song catalogue to the U.K.-based investment company Hipgnosis for an estimated $150 million.
This means that Hipgnosis will now earn half of the income from Young's music, including its future use in any film, TV or advertisement — although Hipgnosis founder Merck Mercuriadis assures that the Canadian icon's songs won't suddenly be licensed to just any project that arises.
The Quebec-born Mercuriadis, who previously managed artists such as Elton John, Beyoncé and Morrissey, said in a statement: "We have a common integrity, ethos and passion born out of a belief in music and these important songs. There will never be a 'Burger of Gold' but we will work together to make sure everyone gets to hear them on Neil's terms." ("Burger of Gold" is a reference to an unnamed company that once requested to use Young's hit "Heart of Gold" in an ad, to which Young joked in a 1973 concert that doing so would require him to rename the track "Burger of Gold.")
This isn't Hipgnosis's only acquisition in recent days. Earlier this week, it was announced that the company also bought 100 per cent of the music publishing rights, as well as 50 per cent of the rights to unreleased compositions, to Fleetwood Mac singer and guitarist Lindsey Buckingham's catalogue. (This sale presents a conflict to bandmate Stevie Nicks, who also recently sold 80 per cent of her publishing rights to a rival investment company named Primary Wave.)
Hipgnosis also struck a deal with famed producer Jimmy Iovine to take on 100 per cent of the worldwide royalties to his 259-song catalogue, which includes classic albums by Bruce Springsteen and Tom Petty, and film production royalties for Eminem's 8 Mile and 50 Cent's Get Rich or Die Tryin'. Prior to these high-profile deals, Hipgnosis already owned the rights to music by Timbaland, Mark Ronson and Blondie's Debbie Harry and Chris Stein.
Why are so many artists selling their catalogues?
Outside of Hipgnosis's big moves, other companies have been hard at work buying out artist catalogues. Last year, Bob Dylan sold the rights to his 60-plus-year catalogue to Universal Music Publishing Group for an estimate of more than $300 million. Universal also paid $100 million for the masters to Lil Wayne's Young Money catalogue.
And while it may appear that only veteran musicians are selling the rights to their music, relatively younger acts are doing the same. Last November, Las Vegas rock band the Killers sold the publishing rights to all their songs to Eldridge Industries, while two months earlier "Radioactive" hitmakers Imagine Dragons sold their catalogue to Concord Music Publishing for over $100 million.
But what are the benefits of selling away the rights to one's music?
Given the impact of COVID-19 on the music industry, many musicians' main source of income — touring revenue — shrunk significantly if not outright disappeared. "We've been forcibly retired," musician David Crosby told the New York Times, adding that he, too, is currently negotiating a sale for his publishing rights. For those who hold valuable catalogues, selling is a way to make money during this difficult time.
But, in an interview with Billboard, wealth advisor Dan Weisman warns artists not to hastily sell their catalogues if the reason is to pay for something in the short term or pay off debts. "If you are looking to sell your catalogue to buy something, then you are probably making a mistake, unless what you are buying is an appreciating asset," he explained. "You should not be selling your catalogue if you 'need' money or even if you 'want' money. I should caveat that by saying that if you are planning on using the proceeds from a sale to get yourself out of debt with the IRS, then please make sure you are working with a licensed CPA on a plan."
For acts like the Killers, their sale presents a chance to get their music into more spaces, as the band said in a statement: "We have the greatest fans in the world. Eldridge's broad network across music, television, and film will provide new opportunities for our music to be enjoyed by millions across the globe."
In the coming weeks and months, more sales will likely be announced, but for musicians, it remains a debate between autonomy and power over their own music versus a big one-time paycheque and trusting another entity to care for and grow your musical legacy.