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Bieber is about to join the ranks of notable musicians who have recently sold the rights to their songs, like Bruce Springsteen, Bob Dylan, and Stevie Nicks.
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| Justin Bieber, Canadian singer |
According to reports, Justin Bieber will soon complete a $200 million deal to sell his music rights.
According to The Wall Street Journal, Bieber is negotiating a deal that would value his rights at "about" $200 million with Hipgnosis Songs Capital, a Blackstone-backed investment and music management company.
According to the Journal, the proposed sale includes Justin Bieber's publishing and recorded music catalogs and would be the largest acquisition for Hipgnosis to date. Earlier this year, the company paid an estimated $100 million for Justin Timberlake's song catalog rights.
Copyrights for songwriting and composition, such as lyrics and melodies, are covered under music publishing. Publishing rights can nonetheless generate a sizeable amount of money over time through radio play, advertising, movie licensing, and other means, even though they are frequently valued less than real recordings.
The news is the most recent in a string of comparable agreements made by musicians over the years as the value of back catalogs rises thanks to streaming platforms like Spotify (SPOT), Apple (AAPL), and Amazon (AMZN).
According to numerous sources, in a deal worth over $500 million, Bruce Springsteen sold Sony Music both his master recordings and publishing rights in December 2021. That same year, the Red Hot Chili Peppers reportedly received $150 million for the rights to their song repertoire.
In a deal apparently worth over $300 million, Bob Dylan sold over 600 copyrights to Universal Music Group in 2020. Before that, Stevie Nicks reportedly received $100 million for the most of her songwriting business.
Guillermo Page, a former record label executive who worked for Sony and Universal, previously told Yahoo Finance, "It comes to the point where there's money flowing from so many different places that you can't go wrong on any type of contract like this."
The University of Miami's music department is currently taught by Page, who commented that "streaming has offered stability."
"The important is that the firm has settled into a predictable pattern, Page said, adding that because the company is expanding, investors may have confidence in its future. Eliminating the ambiguity creates a new opportunity for investors to enter and purchase such assets."
Younger artists are starting to capitalize on the growing trend, as evidenced by the contract reportedly signed by Justin Bieber. However, purchasers are finding it harder to finance transactions in the present context of rising loan rates, which the epidemic era escaped thanks to historically low rates.
According to Page, who explained that musicians can now "grab a ton of money" in ways they were unable to achieve in the past, you can see "all major performers from the 70s, 80s, and 90s that are riding the wave of streaming."
For artists who can now optimize their revenue on the sale of those assets, it's the ideal scenario.
