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Special Report: Why The Value Of Music Catalogs Has Soared By 2500%

Following on our 2021 Special Report: The Evolution of Music Licensing, The Licensing Letter examines how and why music rights sales have grown exponentially since 2015. This report is available to TLL Subscribers only.


By Gary Symons

TLL Editor in Chief

The music industry has gone through a period of almost unparalleled change over the past five years, and that change is now heading in some unexpected directions.

In this month’s Special Report, TLL is taking a look at the latest numbers from MRC Data/Billboard, and analyzing where future growth can be expected in the music licensing industry.

The major trend we are seeing, as detailed in our January 2021 Special Report (The Evolution of Music Licensing), is the continuing rise in value for music catalogs from older, long-established artists like Bob Dylan, David Bowie, Bruce Springsteen and Neil Young, among many others.


That increase over the past half decade has been startling, particularly since music catalogs were a very small part of the overall licensing picture prior to 2016. Between 2010 and 2015 investments in music catalogs ranged from below 100 million in 2014, to a high of just over $200 million in 2011.

Rock legend Bruce Springsteen sold his music catalog for a record $500+ million in December, as overall investments in music rights surpassed the $5 billion mark for the first time in history.

But that all changed in 2016 as a new class of music investors rolled onto the stage. With investment ringing in at just over $100 million in 2015, the next year saw that figure jump to a startling $900+ million.

The surge continued with $1.2 billion in catalog sales in 2017, more than doubled to 2.5 billion in 2018, and soared past the $4 billion mark in 2019. In 2020, estimates showed another healthy increase as the market grew to roughly $4.5 billion, and 2021 looks like it will set another record.

While not all figures are in yet, the industry publication Music Business Worldwide estimates $5.05 billion was spent on music catalogs, of which $2.33 billion was used to acquire rights directly from the musicians or songwriters. In December 2021 alone, $720 million was spent on catalogs, led by the record-setting $500+ million acquisition of Bruce Springsteen’s body of work by Sony Music Group.

And that wasn’t even the single biggest deal in 2021. In October, the music company Kobalt sold its entire catalog of various hits to the music investment firm KKR for $1.1 billion.

There are a lot of reasons this is happening, which we’ll relate in greater detail below, but the main reason is that these investments are paying off.

While older music was not seen as a valuable commodity before 2016, a shift in consumption patterns related to streaming has changed that. These days, older music is dominating the market, and in 2022, for the first time, music that is over 18 months old totaled 70 per cent of the US music market, as opposed to just 30% for new music.

The generally accepted source for music consumption data is MRC Data, part of the same company that owns Billboard.

Special Report: The Evolution of Music Licensing


This year, MRC’s annual report has raised eyebrows throughout the industry with some startling new data. Most important is the finding that the most streamed songs—in other words, the new hits—on platforms like Spotify or Apple Music are getting a smaller share of total streaming activity as “streaming’s torso grows.” Basically, that means the big hit songs dominating the Billboard charts are no longer taking up as much space as they used to be, and people are generally streaming a lot more of the older music instead.

In 2018, MRC Data showed that the year’s 200 most streamed songs were responsible for nearly 1 in 10 of all music streams. By 2021, that number dropped precipitously to less than 1 in 20.

In terms of pure data, it means that a lot more songs are getting more play, while the big, newly released hits are generally being played less. For example, in 2019 the song Old Town Road by Lil Nas X was the most streamed song of 2019 with roughly 1 billion streams. In 2020 the top streaming song was The Box by Roddy Ricch at 920 million, and in 2021 the song Levitating by Dua Lipa was the top streaming hit, but it was streamed only 627 million times. In broad terms, that’s a drop of more than a third compared to the top hit in 2019.

MRC Data puts it simply in their full report, describing 2021 as the year “Catalog music takes the lead,” which certainly is good news for companies dropping billions of dollars on older music.

MRC Data’s report shows ‘Catalog Music’ more than 18 months old now takes up just under 70% of total music consumption, vs. 30% for new music.

“For the first time since MRC Data began tracking streaming data, streaming of new music has declined in volume year-over-year,” says the report. “(That) means Catalog has gained a significant share of total listening in 2021, increasing nearly 5 points from 2020 to 70% of total album consumption.

“This is an acceleration of a trend that picked up steam during the first waves of COVID-19 lockdowns, as music fans turned to old favorites for nostalgia listening or became introduced to them for the first time through playlists, TikTok and other discovery vehicles.”

“It’s the older music that is getting a bigger slice of a bigger pie.”

This is a long-term trend, but it’s worth noting that in 2021 the industry saw a 19.3% increase in consumption of catalog music (defined as more than 18 months old), and a 3.7% decrease in consumption of new music.

It’s also worth noting that this is happening even as the amount of streaming is increasing. Audio on-demand streaming hit a record single-year high of 988 billion streams in 2021, up 12.7% from the year before, but it’s the older music that is getting a bigger slice of a bigger pie.

Rob Jonas, the CEO of MRC Data, says part of the reason for this change is due to new types of deals between music publishers and social media networks like TikTok, Instagram, and others. “The increasingly influential TikTok helped further accelerate some of these trends, as younger consumers discovered songs both new and classic through popular memes and dance challenges,” Jonas says. “The app recently announced in its own 2021 report that over 175 songs that trended on TikTok ended up charting on the Billboard Hot 100, more than twice the amount in 2020.”

As TLL reported in our 2021 report on music, the impact of TikTok was first realized by the music industry when Idaho man Nathan Apodaca (better known as Doggface) filmed himself on a skateboard, drinking cranberry juice out of a jug, and then suddenly bursting into a joyous lip sync version of Fleetwood Mac’s hit Dreams.

The video exploded across the internet, garnering millions of views, and for a while turned Doggface into a much sought-after personality in the social influencer space. It also boosted the sales of the Fleetwood Mac album Rumours and of Ocean Spray Cranberry Juice, not to mention inspiring a legion of imitators. Dreams saw a 374% jump in sales and an 89% jump in streams, and even made it back onto the Billboard top charts at #21 after a 43­-year absence. Dreams hit the Top Ten on Spotify and #1 on Apple Music.

The Fleetwood Mac album is again topping the music charts in the Rock category, decades after its release.

Soon after, Sony Music Entertainment, the label for Fleetwood Mac, entered into TikTok’s first long-term music licensing agreement, with Sony acknowledging that the social media network is becoming a major source of new revenue and marketing oomph.

“Short form video clips have developed into an exciting new part of the music ecosystem that contribute to the overall growth of music and the way fans experience it,” said Dennis Kooker, President, Global Digital Business and U.S. Sales, at Sony Music Entertainment. “TikTok is a leader in this space and we are pleased to be partnering with them to drive music discovery, expand opportunities for creativity, and support artist careers.”

That deal gives TikTok blanket, synchronization access to Sony’s immense music catalog, but the trend has not escaped the notice of artists or the companies buying their intellectual property. Just two months after Dreams bounced back onto the Billboard charts in October, Fleetwood Mac songwriter Stevie Nicks sold an 80 per cent interest of her entire song catalog to Primary Wave for approximately $100 million, and now her career has been given a new start.

In fact, according to this year’s MRC report, Fleetwood Mac’s Rumours was the second highest selling album of the year in the Rock category (combined streaming, physical album sales, and Track Equivalent Albums or TEA), and the song Dreams was the fourth best selling song, beaten out only by new hits like Glass Animals Heat Waves, Machine Gun Kelly’s My Ex’s Best Friend, and Mäneskin’s Beggin’.

Of the top rock albums last year, four were catalog albums like Queen’s Greatest Hits, Fleetwood Mac’s Rumours, Elton John’s Diamonds, and Creedence Clearwater Revival’s 20 Greatest Hits. The only new album to crack the Rock’n’Roll top five was Machine Gun Kelly’s Ticket to My Downfall.


If it’s true that older music is more popular, and therefore more valuable, the bigger question is why that’s happening. Some analysts are even blaming the current slate of mainstream music, saying labels are failing to find and promote interesting new artists.

The music writer Ted Gioia wrote in The Atlantic last month that many people, particularly older consumers, feel the current music scene is, well, boring.

“Decades ago, the composer Erik Satie warned of the arrival of ‘furniture music,’ a kind of song that would blend seamlessly into the background of our lives. His vision seems closer to reality than ever,” Gioia says. “Some people—especially Baby Boomers—tell me that this decline in the popularity of new music is simply the result of lousy new songs. Music used to be better, or so they say. The old songs had better melodies, more interesting harmonies, and demonstrated genuine musicianship, not just software loops, auto-tuned vocals, and regurgitated samples.”

But Gioia says it’s not the fault of musicians, but rather the choice of studios that have failed to find and cultivate artists whose music might be riskier, but is also more creative.

“I can understand the frustrations of music lovers who get no satisfaction from current mainstream songs, though they try and they try,” he said. “I also lament the lack of imagination on many modern hits. But I disagree with my Boomer friends’ larger verdict. I listen to two to three hours of new music every day, and I know that plenty of exceptional young musicians are out there trying to make it. They exist. But the music industry has lost its ability to discover and nurture their talents.”

Whether or not that’s true, there are much bigger forces at work in the music industry that have caused this shift.

Instead, the major reasons are due to shifts in consumer consumption habits, adoption of new technology by older listeners, and the increase in synchronous licensing by music publishers and studios. All those factors combined to raise the value of older music catalogs, and on the other side of the coin, the pandemic, the shift to streaming, and changes to US tax laws gave many older artists a huge incentive to sell their music rights.


Behind the data, TLL has identified six primary reasons for the rapid growth in the value of music rights. Those factors include:

The Rise of Streaming: A lot of musicians blame the business model of streaming companies for the drastic drop in revenue they receive from their music, but the reality is a bit more complicated. Streaming does generate a tremendous amount of money, but most of that does not go to the streaming company or the artist. Instead, it is the record labels or music publishers who get the biggest cut of streaming revenue.

The rate paid to musicians for each ‘listen’ on Spotify is 0.4 cents, so it takes 250 plays for that artist to earn one dollar. A musician would have to achieve 650,000 plays to earn $15, so they might be better off getting a job at a Circle K.

While other platforms pay a bit more, the fact is, musicians a fraction of the revenue they formerly made from the sales of vinyl records and CDs.

The labels, on the other hand, are making bank. Universal, the largest of the Big Three music companies, is earning around $20 million a day from streaming, and faces very little ongoing costs.

Impact of COVID on Concerts: A factor accelerating the music rights market is that the pandemic caused the vast majority of concert tours to be cancelled. Musicians who now make less money on streaming than they did from albums were generally making up the gap by doing concert tours. When that revenue dried up, many aging musicians were driven to seek a one-time payout on their catalogs.

Before selling his own music catalog in 2021, musician David Crosby commented on the sale of Bob Dylan’s catalog and explained why he was also looking to cash out.

“Streaming stole my record money,” Crosby said, adding he is essentially being forced to sell because he can no longer tour due to the COVID-19 pandemic, and makes little money when his songs are played on streaming services like Spotify. “I think he (Bob Dylan) is just facing reality,” Crosby wrote. “We no longer get paid for records. We cannot play live, so we sell the one asset we own, ourselves. What did you expect us to do? We have families.”

Changes to Taxation: Under the previous US administration, taxes paid for selling an asset were pegged at only 20 per cent of the sale price, but the Biden administration has proposed increasing taxes so that any sale of assets over $1 million could result in a capital gains tax of more than 37 per cent. That 17 per cent increase is enough to convince many musicians that the time to sell is right now.

The Rise of the Synch License: Increasingly, music is seen as a commodity that can add value for video games, social media posts, advertising, film, and TV production. In particular, the rise of TikTok videos and the increasing use of musical concerts in the metaverse are driving the value of more comprehensive licenses, including Name Image and Likeness, as well as synch licenses.

The latter is the broadest and most powerful type of license and refers to music that is paired with some type of visual media. Music catalogs have always been valuable for TV ads or soundtracks, but with the advent of TikTok the value has soared, as videos are aired millions or even billions of times. TikTok is also commercializing these videos for advertising and marketing purposes, creating yet another synergy that is massively boosting the value of music catalogs.

When Steve Cooper, the CEO of Warner Music Group, was addressing analysts in late 2020, he revealed that it is social media, not streaming, that is the fastest growing source of revenue.

“With an expanding number of partnerships including Facebook, TikTok, and Snap, among others, social media is already a meaningful nine-figure revenue stream for us, and is growing at a faster rate than subscription streaming,” Cooper said. Warner Music says the revenue from social media-related sales is growing at double digit percentages annually, and this has accelerated recently through the colossal success of TikTok.

Demographics: It’s a widely accepted fact that older people typically like older music, but they also tend to adopt new technology more slowly than young people.

Older people have latched on to streaming services, dramatically driving up the number of older hits that are played on sites like Spotify or Apple Music, and increasing the value of music catalogs.

However, when older people do adopt that new technology they tend to dominate the sales in that sector simply because of numbers and higher disposable incomes. In the case of streaming, the adoption rate for older people is now almost as high as it is for the younger crowd, and the result is that older music now dominates the Spotify play list.

The United States has a very high rate of streaming service users, with 99% of Gen Z and 98% of Millennial listeners using these types of services at least once a week. However, the big change is that older people use streaming services at almost the same rate, creating that ‘longer torso’ that the MRC Data report talks about. An impressive 96% of Gen X listeners (age 40–55) used streaming services at least once a week in the past year, and even the oldest category of listeners, the Baby Boomers aged 56 to 74, had risen to an 89% adoption rate.

The numbers are lower in most other countries, but the trend is clear; streaming is growing, but the older demographics are now growing faster. It was inevitable, in hindsight, that catalog music would become a bigger part of streaming, just as older classic music tends to dominate radio.

That also means a large percentage of the Billboard’s Top 100 just isn’t speaking to a vast audience within the streaming world, represented by those aged 35 and up. As a result, buying up these music catalogs is allowing the VC-backed music royalty companies to essentially create their own monopolies for music that’s older, but still popular with a large fan base.

The High Cost of Artist Development: Yet another reason for the surge in catalog value is that it competes well with the huge costs involved in finding and promoting new artists. Occasionally you do see an artist burst onto the world stage without much help from a major label, but most music stars become global icons at least partly because of the millions of dollars spent on marketing and promotion.

In 2019, for example, Universal Music Group earned $8 billion in revenue in 2019, but spent $4.6 billion in what is known as Artist & Repetoire (AR) costs, and their annual operating income was only $1.31 billion.

By contrast, companies buying up catalogs know the music they’re buying is already popular, and there is little or no AR cost involved. The songs might not hit the Top 40 on Spotify, but they are solid, reliable generators of royalty income, at a lower operational cost.


The changes in the music rights market over the past year coincide closely with what TLL expected would happen, following publication of our Special Report: The Evolution of Music Licensing. The growth of catalog music based on demographic shifts in the streaming market was expected, and has been happening since pioneering companies like Hipgnosis saw the opportunity in 2016.

The Virtual Girl Group K/DA Performs … sort of … at the League of Legends World Championship. The completely fictional members of the band are now chart toppers in the real world, and revenue from ‘virtual pop stars’ is expected to grow exponentially as the metaverse develops.

That said, TLL is seeing another growing trend that will impact both older catalog music and newer music, creating new markets for the industry.

That trend relates to the rise of the metaverse, and we’re already seeing the major companies diving in with major events and investments.

The best-known examples involved ‘live concerts’ that occurred within Epic Games’ Fortnite video game by rapper Travis Scott and pop star Ariana Grande, both of which earned millions for the artists through sales of skins and through licensing deals. During Travis Scott’s 10-minute performance, his giant avatar wore Nike Air Jordan sneakers. It’s estimated that this brand awareness benefit was worth at least $518,000 for Nike.

More recently, Meta (previously Facebook) staged three concerts on its metaverse platform. The star-studded lineup included rapper Young Thug on Dec. 26, DJ David Guetta on Dec. 31, and finally EDM duo The Chainsmokers for a New Years’ Eve concert to ring in 2022.

By all accounts the concerts were a flop with very little attendance, but those who pointed and laughed are missing the point that for Meta, this is just a dry run for the future. With over $10 billion budgeted for metaverse development, the company’s metaverse known as Horizon Worlds is expected to grow quickly through its links with Facebook’s prodigious user base.

On Jan. 28, Warner Music announced it is staging a series of live concerts in the metaverse in partnership with The Sandbox, the developer of a metaverse world.

“Our partnership with The Sandbox adds a new layer of possibility in the metaverse, with the ownership of virtual real estate,” said Oana Ruxandra, Chief Digital Officer & EVP, Business Development at Warner Music Group. “As a first-mover, Warner Music has secured the equivalent of beachfront property in the metaverse. On the LAND, we’ll develop persistent, immersive social music experiences that defy real-world limitations and allow our artists and their fans to engage like never before.”

Warner and The Sandbox also plan to sell NFTs (non-fungible tokens) to fans as another way to generate revenue for the music it owns.

“We’re shaping The Sandbox as a fun entertainment destination where creators, fans, and players can enjoy first-of-a-kind immersive experiences and be more closely connected to their favorite musical artists through NFTs,” said Sebastien Borget, COO and Co-Founder of The Sandbox. “This strategic partnership with Warner Music Group brings the open metaverse one step forward in the direction of fan-owned and community-driven initiatives—the possibilities are very exciting.”

It’s also worth pointing out that when artists appear in the metaverse, they show up as digital, three-dimensional representations of the real person. For that reason, the metaverse opens up new possibilities for catalog music that just can’t be pulled off easily in the real world.

One of those involves the development of virtual music stars, which might be bands made up of people that don’t exist, or that may be younger versions of older or even deceased music stars, now holding concerts as virtually immortal beings in the metaverse.

Companies that now own the name, image and likeness rights to musicians like Fleetwood Mac or Bruce Springsteen, for example, could easily stage digital, live concerts to their legions of fans.

Alternatively, as the video game developer Riot Games has done in its annual augmented reality concerts with the fictional pop band K/DA, those live concerts may also star completely fictional characters.

The one thing we can predict is that the development of the music rights market in the metaverse will be unpredictable, and that licensing companies will come up with new ways to market music catalogs that we haven’t even thought of.

  Who’s Buying the World’s Music? A List of the Big Deals in 2021

Sony Music: Estimated $550 million on Bruce Springsteen, Todd Moscowit’s Alamo Records label, Brazilian record label Som Livre, estimated $200+ million for Paul Simon

Universal Music Publishing Group: Catalog of songwriter Louis Bell (Post Malone, Jonas Brothers)

Warner Music: $400 million for 300 Entertainment, $100 million to David Guetta

BMG: Joint Acquisition with KKR of ZZ Top’s catalog ($50+ million), Motley Crue ($90 million), Tina Turner ($50+ million)

Concord: Influence Media Partners: Catalog from songwriter Julia Michaels, catalog from Ali Tamposi

Primary Wave: $90 million for James Brown, $20 million for Jim Peterik, $30 million to Jeff Porcaro of Toto, catalog for Mike Scott of the Waterboys, Teddy Pendergrass, $40 million deal with Luther Vandross, $20 million for Gerry Goffin, $50 million for Bing Crosby estate, buys stake in the estate of Prince for between $100 million to 300 million

Wise Music Group: Acquires the Zombies catalog

Hipgnosis: Set a record buying 50% of Neil Young’s catalog. Also buys out Jimmy Iovine’s producer catalog royalties, and catalogs from Lindsey Buckingham and Christine McVie of Fleetwood Mac, Shakira, Michael Buble, Bob Rock, Carole Bayer Sager, Andrew Watt, Andy Wallace, Lorde, Taylor Swift songwriter Joel Little, the Red Hot Chili Peppers

KKR: Joint Acquisition with KKR of ZZ Top’s catalog ($50+ million), Acquires Kobalt’s catalog for $1.1 billion, the Ryan Tedder catalog

Iconic Artists Group: Linda Ronstadt, David Crosby, the Beach Boys

Reach Music: Buys 50% interest in song catalog of Judas Priest’s Glenn Tipton

Reservoir: Fred Parris of the Five Satins, stake in songs from producer Dallas Austin, country artist Stephony Smith, catalog from Nashville’s Sorted Noise, rock producer Tom Werman, and buys Tommy Boy Music for $100 million

Tempo Music: Publishing rights from producers Stefan Forrest, Morten Ristorp and Morten Pilegaard; two albums from Korn; share of catalog from Twenty One Pilots singer Tyler Joseph

CTM Outlander: Music rights from Grammy-winning songwriter Natalie Hemby; buys One77Music:

Raleigh Music Publishing: Buys Lee Morris catalog, including the Bobby Vinton hit Blue Velvet.

Mojo Music & Media: Catalog of songwriter and producer Jacknife Lee.

Round Hill Music: catalogs of Jellybean Benitez including hits by Madonna and Whitney Houston; The O’Jays; British producer and songwriter Tim Palmer; Dennis Elliott, former drummer of Foreigner; Yes guitarist and film composer Trevor Rabin; masters catalog from Los Angeles-based indie label Innovative Leisure; master recordings from Swedish label Telegram Studios; country songwriter and producer Zach Crowell; Round Hill’s UK-listed fund spends $282 million on hits recorded by The Beatles, Marvin Gaye and more; catalogs of Massive Attack members Robert Del Naja and Grant Marshall; Collective Soul; Billy Duffy, songwriter for The Cult; Bryan Adams songwriting partner Jim Vallance; songs by Jellybean Benitez including hits by Madonna and Whitney Houston.

Special Report: The Evolution of Music Licensing

Hipgnosis Is Rocking Revenue With Music Catalog Acquisitions



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