Catalogue sales in the United States and European music markets, as well as their big-money deals frequently running into hundreds of millions, have made attention-grabbing headlines in the last three years.


Artistes and songwriters have repeatedly relinquished their ownership of previously released musical works in exchange for one-time payouts from investors and music management companies of global repute.

Although arguments abound as to whether or not this protracted boom is grounding to a halt, such deals are fast consolidating music IP as a valid and recession-proof asset class while also disrupting how the industry operates.

Publishing rights have long resided with publishers or songwriters, and rights to master recordings with the labels or independent performing artistes who are at liberty to license their music to third parties like TV shows, films, commercials, or for sampling by other artistes while reaping income in form of royalties.


Now, venture capitalists can bid for such rights and purchase music intellectual property much like stocks. They can then work with partners to remarket those works in hopes of profiting from all revenue streams available for it.

Canadian singer Justin Bieber, in February 2023, sold his publishing rights and master recordings to the London Stock Exchange-traded IP investment firm Hipgnosis for a reported $200 million. The deal covers Bieber’s works released prior to December 2021, including his most recent album at the time of the deal ‘Justice’. In late 2022, Whitney Houston sold her entire catalogue to the US publishing company Primary Wave for an undisclosed sum.

Universal has similarly been in talks to acquire the British rock band Queen’s catalogue from representatives of Disney Music Group for an estimated record $1 billion in a deal that combines both publishing and recorded music rights. In turn, Sony Music Group is also close to finalising a deal to acquire around 50% of the Michael Jackson estate, including the late pop star’s publishing and recorded music rights for at least $750 million.


Other contemporary artistes who have sold as little as a single song to big chunks of their catalogues include Beyoncé, Ariana Grande, Justin Timberlake, David Guetta, Rihanna, and Kendrick Lamar.

What is driving the boom? In March 2023, the IFPI (International Federation of the Phonographic Industry) reported that the global recorded music market grew by 9.0% in 2022.

According to the report, total trade revenues for 2022 were US$26.2 billion. Subscription audio streaming revenues increased by 10.3% to US$12.7 billion and there were 589 million users of paid subscription accounts at the end of 2022.

Total streaming (including both paid subscription and advertising-supported) grew by 11.5% to reach US$17.5 billion, or 67.0% of total global recorded music revenues.


The report shows there is an apparent surge in music streaming revenue that made catalogues a more valuable asset class for rights management companies who jostle to buy out these works for up to 30 times their average annual royalty yields.

In Sub-Saharan Africa, music revenues spiked by 34.7% in 2022 to make the region the fastest-growing on the continent. This was driven largely by a significant 31.4% boost in South Africa, the region’s largest market. The Middle East and North Africa had the third highest growth rate in 2022, spiralling by 23.8%. And 95.5% of that growth came from streaming, the highest from any region globally.

TikTok is making more inroads in the industry, accelerating the discovery of music in ways that drive up streams and downloads for even older tracks.

The incentives were more complex in 2021 and 2022 for markets like the US, where the cheap cost of capital at the time made investors more desperate to buy catalogues and taxation made it more prudent for rights holders to sell within a favourable window, rather than wait out future highs.


But beyond the positive signals from the streaming sub-sector, where revenue for Africa is projected to hit $524.10 million by 2027, do artistes on the continent have just as much incentive as the West to join the catalogue sales frenzy?

The sale of part or all of a music catalogue can be a significant income source for artistes who amassed a substantial body of work or whose catalogues didn’t make much income. By forfeiting their copyright, they get to reinvest the cash in other ventures or simply fund their retirement.

In 2018, Primary Wave acquired part of the late reggae legend Bob Marley’s music catalogue. Nigerian showbiz entrepreneur Mr Eazi, who is looking to buy catalogues himself through the VC fund Zagadat Capital, agrees that there is immense opportunity for African classics of the 50s and 60s in such deals.

But Afrobeats, dominated by Nigerian acts like Burna Boy and Wizkid, is still in its heyday.


So Kizito Ahams, the licensing and publishing manager at Mavin, a leading Nigerian record label, says the timing might not be right for contemporary talents in Afrobeats to sell.

“We’ve never had as much success as we currently have. We have our superstars making giant strides in their careers and selling out arenas of up to 60,000 in capacity globally,” he says.

“It’s better to develop our own industry structures and position ourselves to tell our own stories in a market that is nascent and growing.”

Ahams further argues that the globally growing consumption of music heralds even much brighter prospects for Afrobeats, so talks about purchasing catalogues amount to “striking gold early” for potential buyers, as opposed to them having strong peculiar interests in these works.

The decision to sell music catalogues is a complex one that depends on various factors, including the individual artiste’s goals, financial situation, and long-term plans. Selling a music catalogue can provide a substantial upfront payment and allow artistes to transfer the administrative and financial responsibilities of managing their catalogues to the acquiring party.

However, there are long-term implications, such as loss of control over creative decisions relating to such works and the financial benefits that could have trickled in over a stretch of time in royalties.

There are regional dynamics for African artistes to consider that make all the difference. It could be market size, revenue streams, infrastructure, or catalogue valuation which determine the opportunities and challenges for selling catalogues.

“Investors are primarily concerned with numbers and ensuring a return on their investment,” says Abuchi Ugwu, chief executive at Chocolate City.

“Therefore, content owners must demonstrate how the valuation aligns with market demand, revenue potential, and long-term growth prospects.”

Many Nigerian artistes, when signing contracts with labels, typically relinquish most if not all of the IP rights associated with their works. In some instances, the record label may also acquire exclusive rights over the merchandise or stage names of the artiste. Catalogue ownership, for most artistes signed to such labels in this case, is vested in the record label itself that financed and hence has the right to sell those works.

While Ugwu argues that the idea of catalogue sales for African artistes is viable, the chief executive points out that a thorough analysis of the catalogue’s performance, potential future earnings, and market dynamics must be undertaken to arrive at an accurate valuation that mitigate the risk of negative exploitation and to extract maximum benefit.

It becomes apparent that creatives must seek legal, financial, and tax counsel in all negotiations that concern the assignment, transfer, licence, or outright sale of their catalogues while bearing these market dynamics in mind.

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