Michael Jackson Song Catalog Will Moonwalk to Sony/ATV Publishing

[ivy]

The news said Warner has songs like Billie Jean and Beat it. I guess the MJ and Warner had deal in early 80s already. He purchased ATV in late 80s. I guess that's why.
However, I don't know why he didn't make the deal with other SONY publsihing company. Maybe Warner give him better offer or he just didn't want to put all eggs in the same basket.

sony wasn't really that big in publishing business until they formed partnership with Michael in 1995.

 

[ivy]

how long the contract for catalog administration usually last?

obviously, i know very little about music publishing and i definitely would like to learn more.

i found it interesting that how people always said Michael "owns" the Beatles catalog. John Branca mentioned Michale "wanted those songs."

but, in fact, Michael didn't really own the songs. he just ownend the right to publish the songs. Can the artist switch to another publisher? Is there any review and renewal process?

If we are to go into details Beatles catalog is a little different actually. Lennon/McCarthy had some co-investors, their original contract wasn't good and they lost some of the rights. (so actually Michael/Sony has higher level of control on them)

Anyway I'll say the answer to all of your questions is depends on the contract/ agreement. For example Beatles catalog had been up for sale 2-3 times and McCarthy said that he tried to negotiate a better royalties income agreement with Michael and he didn't approach it.

 

[mjjmsc]

Guys let's do a Publishing 101 class here

First let's understand music - a songwriter / composer writes a song. He owns his song.

A musician deserves to be paid when his song is played. Radios have to pay royalties when they play a song, TV programs has to pay licensing fees when they use the song in their shows etc.

How will the musician collect these royalties / licenses , these money that he's supposed to get from the people that play/use his songs? Is he going to go door by door and ask them to pay him?

No. It's impossible for a musician to do this.

What happens is a musician forms a "catalog" and agrees with a "publishing" firm. Musician says to the Publishing firm "please collect the money I deserve from my song catalog and I'll give you a part of the money (anywhere between 20-50%) for the job you do".

So the "publishing" firm manages the catalog, it collects the money, gives a part of the money to the musician and takes a good fee for the work they do.

So in short Sony/ATV and Michael doesn't own the Beatles songs, they manage the publishing rights of the songs and get a percentage of royalties from the songs. In other words Lennon/McCarthy owns the Beatles songs but Michael gets a share every time someone buys/ plays/ uses a Beatles song.

Similarly Warner didn't own Michael's songs, they managed publishing rights an got paid for it - a high fee (anywhere around 20-50%) as the article says.

and Sony/ ATV won't own Michael's songs , they'll just manage publishing rights.

Now let's do some math - Assume that Michael earned each year $100M from his songs and the publishing firm got 40%.

With Warner - Michael would have gotten $60M and Warner would gotten $40M.

Assume the same scenario with Sony/ ATV.

Michael would have gotten $60M and Sony/ATV would gotten $40M.

but guess what Michael has 50% share in Sony/ATV so he gets 50% of what Sony/ATV makes - in this case he would have gotten in 50% of $40M

So if Sony/ATV manages his catalog Michael would get $80M and Sony would be left with $20M.

Does this make it clear now?


---------------------------------





Probably when he made the publishing deal with Warner , Warner was afraid that he'll take his catalog to his own Sony/ATV and they put a clause like he couldn't take the catalog from them until the 10th album etc. So the new releases can satisfy this clause in the contract and allow them take the catalog from Warner.

plus the article mentions the loan. as his catalog was used as collateral that might have stopped the move.

thank you so much for the explanation...so it is a good news

 

[Maria MJ]

For some reason I am very uncomfortable with that move.
It certainly feels like Michael's assets are being packaged up for some convenience--what could that be, I wonder.
I truly hope I'm wrong and we are not entering a pre-liquidation stage. Michael's assets aside from being a huge source of income, define him as an astute businessman and are an integral part of his life and legacy.

 

[Go Flying]

The Estate benefits from this venture massively-the slice of the royalties that went to Warner will now go to Sony/ATV so basically the Estate is pretty much collecting almost 100% of the royalities now from Michael's own music. Its a good move financially and one that seems that Michael had been wanting to make years ago.

Given Michael's stature at the time of formation os mijac, Warner would have been getting the very tiniest of percentages to administer mijac - probably around 3%.

Even if Sony charge the same amount, you're gonna have to figure in the 15% of gross tranasction price, (and quite possibly ongoing fees) that branca and mcclain are goiing to charge the estate for setting up this pretty straightforward transfer from warner to sony. In other words, let's imagine that, for example, Mijac is aquired by sony for $100m, then Branca & Mclain wuill charge the estate $15m straight off the top of that transaction.

Doesn't look quite so sweet now huh?

 

[izilda]

it's been since the beginning that proclaims loud and clear, the Estate is colluding in this story, so normally it should have been what they should have done, but it is far from being the case .
They are part of the game!
They know how to do
Leave no suspicious
Michael said:
Follow the money
really disgusted!

 

[PCR]

I hate that people are commenting on something they don't even understand.

Educate yourself FIRST...otherwise it looks foolish and annoying.

Ivy, thank you for schooling them.

Google is your friend...don't be stranger.

Well... this is the kind of post that nobody really needs here. Useless and pointless. Many of us are openly recognizing we have no clue about the meaning of this business, that is why being part of a community of fans with different talents and information, we rather ask those who knows. People like Ivy are generous and smart enough to give a quick and effective explanation without calling names, without spreading hate, only for the sake of the community growing bigger, stronger and more knowledgeable.

If you were so clear about the details and meanings of this transaction, Memefan, it would have been nice from you to enlighten our ignorance. At least that would be quite more useful than just throwing crap -_-

 

[Memefan]

Well... this is the kind of post that nobody really needs here. Useless and pointless. Many of us are openly recognizing we have no clue about the meaning of this business, that is why being part of a community of fans with different talents and information, we rather ask those who knows. People like Ivy are generous and smart enough to give a quick and effective explanation without calling names, without spreading hate, only for the sake of the community growing bigger, stronger and more knowledgeable.

If you were so clear about the details and meanings of this transaction, Memefan, it would have been nice from you to enlighten our ignorance. At least that would be quite more useful than just throwing crap -_-

Like I said, we all have access to Google. And it is ALL there.

And there's nothing wrong with asking Ivy for information (I've done it myself) but it grates me when folks are stating things as fact..without the basic knowledge (or some basic research) of Music Publishing.

There's nothing one in taking a minute to look something up...we are quick to criticize the media when they do it, but we do the same here ..on a smaller scale.



A mind is a terrible thing to waste _Malcolm X

 

[Bridgett_361]

I don't see anything wrong with the move, if ATV is planing to buy warner music then moving MJj out of the way devaule the price of Warner music,
Also we are forgetting MJ own 50% of ATV publishing why not let his own company to the work and collect the fee?
But I guess the conspirator are going to spin it there way.

 

[Hess]

This way the children will get a lot more money - so this is something MJ would have liked very much. To secure his children.

 

[Tia Yess]

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[Staffordshire Bullterrier]

Exactly how is this good news then? I mean...look at the fiasco with the new album. It's pretty hard for me to get excited about any 'new' material from now on. What will all this mean for unreleased MJ songs? In short.....why is this good news for us?

 

[AndreyZidane™]

Exactly how is this good news then? I mean...look at the fiasco with the new album. It's pretty hard for me to get excited about any 'new' material from now on. What will all this mean for unreleased MJ songs? In short.....why is this good news for us?

I don't think this has anything to do with the quality of the material that will be released in the future or the amount of it. I'm guessing this transaction only means that Michael's Estate will get more money since they own Sony/ATV (not $ony Music).

 

[Big Apple2]

But I guess the conspirator are going to spin it there way.

Of course so. For "some" folks all that matters is them being able to say: "I told you so!"

Reminds me of when the loans were about to come due, and these same folks were going on and on, saying that the loan would default and The Estate of Michael Jackson would be selling Michael's half of Sony/ATV. There was a zillion page post on this board with folks calling for the heads of the Estate and then nothing happened. The loans were taken care of and the Estate moved on to their next challenge.

I applaud their work, thus far!

 

[twinklEE]

Of course so. For "some" folks all that matters is them being able to say: "I told you so!"

Reminds me of when the loans were about to come due, and these same folks were going on and on, saying that the loan would default and The Estate of Michael Jackson would be selling Michael's half of Sony/ATV. There was a zillion page post on this board with folks calling for the heads of the Estate and then nothing happened. The loans were taken care of and the Estate moved on to their next challenge.

I applaud their work, thus far!

Same here!

 

[teli-mj]

I believe in the future Michael Jackson's Catelogue will be worth much more the Beatles Catelogue; because, Micheal's music is so more diverse and vital. (i.e. Better :cheeky

I am sorry to say this but that is never going to happen for lots of reasons.

Anyway, i personaly feel a little bit unconfortable with this move. I guess time will tell.

 

[ivy]

Given Michael's stature at the time of formation os mijac, Warner would have been getting the very tiniest of percentages to administer mijac - probably around 3%.

nobody administer catalogs for 3%. Industry average is at 15-25% for big name artists. These could raise for smaller artists.

Exactly how is this good news then? I mean...look at the fiasco with the new album. It's pretty hard for me to get excited about any 'new' material from now on. What will all this mean for unreleased MJ songs? In short.....why is this good news for us?

I don't think this has anything to do with the quality of the material that will be released in the future or the amount of it. I'm guessing this transaction only means that Michael's Estate will get more money since they own Sony/ATV (not $ony Music).

It has nothing to do future releases. They'll just collect money FOR Michael every time his songs gets played /bought / used and they'll get a fee. that's what publishing is.

 

[Moonwalker.Fan]

That's just the first step until $ony will own both of MJ's catalogues! They always wanted them and still want them. And they will do anything to get them! Because that's where the big money is, not album sales or whatever!
Doesn't it make you wonder why Warner was responsible while MJ lived???? Not a bit???

I personally think MJ would be pissed off that Sony had rights to his catalog...but that's my opinion

Sony Music has almost nothing to do with Sony/ATV-Mijac... as for the controle of MiJac

but if this is true then why didnt he add his mijac to sony/atv when he was alive?

Because, maybe administering MJ songs through MiJac was signed with Warner before buying ATV Music Publishing (1985) and before the merger of Sony and ATV in 1995.
Simpy there was the original deal somewhere in 1979-82, and evidently Michael in the mid 90s arranged a new deal that after some years he would get his MiJac back, or possibly after his death... MiJac would be returned to Sony/ATV=MJ Estate.

Yes, finally they took her skin, her catalog and all cash for everything and anything from marketing. We lost him and Michael lost everything including their lives to defend their heritage, the work of a lifetime ... What I want to light a bonfire and burn to see their souls and rot their huts! I hate them, I cursed!

Why he has not sold, I do not know. For her children. I am also saying that he could not sell it, at least not as he wished. It was "stuck". THEY would have taken him for a pittance, or under certain conditions ... completely degrading. Or to elicit ANY unconditionally. Michael has suffered betrayals. How can we trust in this case? He had confidence in his own talents, so he did or rather tried to do "This Is It" with the end as we know everyone. (That is, the circle is complete. How far will they go? I hope they pay, checkout one day. Karma or something.

there was no reason to sell anything, rumours and tabloid speculations became ridiculous and even main stream media have taken this as something relevant... reporting that Michael was in huge debts because of his so-called lavish lifestyle and that he had to sell his "Beatles catalogue", which is nonsense, at least because Sony/ATV consists of 750k songs of (at least) 5 huge catalogues, of which only 256 are the Beatles songs.

Michael appraised this catalogue as his most valuable asset, and wanted it to belong to his kids....

how long the contract for catalog administration usually last?

obviously, i know very little about music publishing and i definitely would like to learn more.

i found it interesting that how people always said Michael "owns" the Beatles catalog. John Branca mentioned Michale "wanted those songs."

but, in fact, Michael didn't really own the songs. he just ownend the right to publish the songs. Can the artist switch to another publisher? Is there any review and renewal process?

... how long the administration lasts is a VERY IMPORTANT question, because that is something (I dont know it specifically) that has limited years boundary. AFAIK, Paul McCartney will get some of the rights for his songs after 25 years as the songwriter/composer.
After 25 years (or maybe a bit more), artists will get some of their administration rights or ownnership.
I dont know the detials, somebody could look for it.

For some reason I am very uncomfortable with that move.
It certainly feels like Michael's assets are being packaged up for some convenience--what could that be, I wonder.
I truly hope I'm wrong and we are not entering a pre-liquidation stage. Michael's assets aside from being a huge source of income, define him as an astute businessman and are an integral part of his life and legacy.

the thing is that if MJs Sony/ATV share was/is a a guarantee, buying MiJac catalogue can be at risk of the loan repayment.
OR
it can be something like a mutual advantage having all MJ songs under controle.

Anyway, its a very sophisticated move.

 

[Moonwalker.Fan]

Details: Sony/ATV Music Publishing: Facts, Discussion Forum, and Encyclopedia Article

Sony/ATV Music Publishing is a music publishing company co-owned by The Michael Jackson Family Trust and Sony. The organisation was originally founded as Associated TeleVision (ATV) in 1955 by Lew Grade. In 1957, ATV acquired Pye Records as a wholly-owned subsidiary. At the time, Pye Records was one of the three major record companies in the UK and, along with EMI and Decca Records, accounted for the vast majority of music records sold in the country.

Sony/ATV Music Publishing is a music publishing company co-owned by The Michael Jackson Family Trust and Sony. The organisation was originally founded as Associated TeleVision (ATV) in 1955 by Lew Grade. In 1957, ATV acquired Pye Records as a wholly-owned subsidiary. At the time, Pye Records was one of the three major record companies in the UK and, along with EMI and Decca Records, accounted for the vast majority of music records sold in the country. ATV Music Publishing was then created to exploit the catalogue of songs written by artists on the Pye Record label, and for the themes to Independent Television Corporation and ATV programmes. Grade established ATV's headquarters alongside those of Pye Records; off of Edgware Road, beside the Marble Arch in central London.

ATV Music Publishing and Pye Records were at the forefront of the British music explosion in the 1960s. The businesses held contracts with several US companies, allowing them to manufacture and distribute records in the UK. ATV Music Publishing and Grade acquired the rights to the Lennon/McCartney song catalogue, Northern Songs, in 1968. The catalogue featured nearly every song written by John Lennon and Paul McCartney until The Beatles' split in 1971.

Grade's fortune began to dwindle as the 1980s approached and by the mid-1980s, ATV Music Publishing and Pye Records were both up for sale. The companies were bought by Australian businessman Robert Holmes à Court, who disposed of them quickly and to his great profit. They were sold to Jackson for $47.5 million in 1985. This upset McCartney—who had told Jackson about the importance of owning publishing, and his own plans to purchase The Beatles catalog—who felt Jackson on purpose outbid McCartney.

In 1995, ATV Music Publishing was merged with Sony and renamed Sony/ATV Music Publishing. The company became the third largest music publisher in the world, owning the rights to songs by Elvis Presley, Eminem, Akon, Bob Dylan, and Willie Nelson. The value of Sony/ATV Music Publishing has varied in reports. Industry experts have estimated the company to be worth as much as $1.5 billion.

Founding

Sony/ATV was originally founded as Associated Television (ATV) in the UK in 1955. It was formed by the impresario Lew Grade, of the entrepreneurial Grade family. At this time, Grade had also founded the Independent Television Corporation (ITC), which featured stars such as Patrick McGoohan, Roger Moore, and Tony Curtis. ITC provided programmes to British and international broadcasters. ATV itself was originally one of these broadcasters; the company had been awarded a franchise in the mid-1950s to operate a new commercial television company in the UK. ATV was broadcast to the English Midlands as part of the Independent Television (ITV) network. Business tycoon Louis Benjamin was also involved with Grade, as part of one of the three major record companies in the UK at the time. The company was Pye Records which, along with EMI and Decca Records, accounted for the vast majority of music records sold in the UK. In 1957, ATV acquired Pye Records as a wholly-owned subsidiary. Grade and Benjamin held most of the shares. ATV Music Publishing was then created to exploit the catalogue of songs written by artists on the Pye Record label, and for the themes to ITC and ATV television programmes. The UK rights to some of the rock 'n' roll music from the US were also bought by ATV. Grade established ATV's headquarters alongside those of Pye Records; off Edgware Road, beside the Marble Arch in central London.

Early history

The 1950s and 1960s were a good period for the Grade family and their companies. Their television operation, which held a vast monopoly of advertising revenues, was part of a system described as having a "license to print money" by Roy Thomson, 1st Baron Thomson of Fleet. Pye Records was at the forefront of the British music explosion in the 1960s. The Searchers, The Kinks, Donovan, The Moody Blues, Mungo Jerry and Petula Clark were some of the artists that Pye Records released music by. The record label also had contracts with a several US companies, allowing them to manufacture and distribute records in the UK. Chess Records was among those, and counted Chuck Berry as one of their top artists. ATV Music and Lew Grade, who had been knighted by this time, acquired the rights to the Lennon/McCartney song catalogue, Northern Songs, in 1968. The catalogue featured every song written by John Lennon and Paul McCartney until The Beatles' legal split in 1971. Northern Songs had been co-owned and administered by Brian Epstein and Dick James. Upon Epstein's death in 1967, James, who was approaching retirement, put the company up for sale. Lennon and McCartney, upset that the songs they had written were not theirs legally, attempted to gain ownership of the publishing rights. Their bid to gain control, part of a long and acrimonious fight, failed. The financial clout of Grade, their adversary in the bidding war, ensured that the music written by the two Beatles passed into the control of ATV.

ATV Music Publishing remained a successful organisation in the music industry throughout the 1970s. Len Beadle, the company's chief executive, signed up many songwriters and bought numerous song catalogues. He acquired the songs written by Lieber and Stoller, which included the Elvis Presley hits "Hound Dog" and "Jailhouse Rock". The Lieber and Stoller catalogue also contained Little Richard's greatest hits. The catalogue acquisitions, along with the continuing royalties from Lennon and McCartney, ensured that large amounts of money were frequently coming in for ATV Music Publishing. Despite the success of the music publishing organisation, other ventures formed by Grade were not performing as well. Pye Records, which continued to distribute music from artists such as Carl Douglas and Barry White, was failing to bring in large amounts of money. The television arm of ATV lost its government-granted license and their English Midlands franchise was awarded to Central Television, in which Grade had a minority stake. ITC also lost money on the flop movie Raise the Titanic. Grade's fortune diminished as the 1980s approached.

Acquisition

By the mid-1980s, ATV Music Publishing and Pye Records were both up for sale. The companies were bought relatively cheaply by Australian businessman Robert Holmes à Court, who asset-stripped them and sacked many long serving employees, before selling them on again. During this time, American singer Michael Jackson was recording "Say Say Say" for Paul McCartney's Pipes of Peace album. Jackson stayed at the home of McCartney and his wife Linda during the recording sessions, becoming friendly with both. One evening whilst at the dining table, McCartney brought out a booklet displaying all the songs to which he owned the publishing rights. He explained that music publishing was a way to make big money. Jackson replied by telling McCartney that he would buy The Beatles' songs one day. "Great. Good joke", McCartney laughed.

Shortly afterward, John Branca, Jackson's attorney, advised the singer that the Northern Songs catalogue was up for sale. Warned of the competition he would face in buying such popular songs, Jackson remained resolute in his decision to purchase them. Branca approached McCartney's attorney to query whether the Beatle was planning to bid. The attorney stated he wasn't; it was "too pricey". McCartney had previously attempted to purchase Northern Songs alongside John Lennon's widow, Yoko Ono in 1981 for $20 million; the pair would each pay $10 million. Ono refused as she thought it was too high a price. Not wanting to spend the $20 million himself, McCartney let the sale fall through. After months of negotiating, Branca closed the deal and purchased Northern Songs on Jackson's behalf for $47.5 million.

In an analysis of the acquisition, Los Angeles Times noted that if "Yesterday" were to earn $100,000 a year in royalties, the Lennon estate and McCartney would divide 50% of the income; $25,000 each. The publisher, Jackson, would receive the other 50%; $50,000. It was added that "Yesterday" in particular would earn considerably more than $100,000 a year. The publisher would also control the use of the song in films, commercials and stage productions. Jackson went on to use the Beatles' songs in numerous commercials, feeling that it would enable a new generation of fans to enjoy the music. McCartney, who himself had used the Buddy Holly song catalogue in commercials, felt saddened. Privately, Jackson was reported to have expressed exasperation at McCartney's attitude; he felt that the musician should have paid for the songs he had written. At the time, McCartney was one of the richest entertainers in the world, with a net worth of $560 million and a royalty income of $41 million. Jackson stated, "If he didn't want to invest $47.5 million in his own songs, then he shouldn't come crying to me now".

Ono was pleased that Jackson had acquired Northern Songs and called it a "blessing". Speaking in November, 1990, Ono stated, "Businessmen who aren't artists themselves wouldn't have the consideration Michael has. He loves the songs. He's very caring." She added that if she and McCartney were to own the songs, there would certainly be arguments. Ono explained that neither she or McCartney needed that. "If Paul got the songs, people would have said, 'Paul finally got John'. And if I got them, they'd say, 'Oh, the dragon lady strikes again'".

Merger

After Jackson's acquisition of ATV Music Publishing, his record label, CBS, were negotiating the sale of their record division in an unrelated deal. Following hurriedly arranged meetings and disagreements over the selling price, a deal was sealed by Jackson during a concert in Tokyo. Upon seeing the success of this sale, Japanese corporation Sony sought to break away from its core business of hardware manufacturing and diversify into music, films and games. Looking for further opportunities, the company aimed to expand its music publishing interests. The Japanese corporation offered Jackson $90 million for 50% of ATV Music Publishing in 1995. Jackson gladly accepted; he had essentially acquired half ownership of the Beatles' songs for a large profit. Jackson's own songs were not included in the deal. Having been merged, the company was renamed Sony/ATV Music Publishing and became the third largest music publisher in the world. Michael P. Schulhof, President and CEO of Sony, welcomed the merger and praised Jackson for his efforts in the venture. "Michael Jackson is not only the most successful entertainer in history; he is also an astute businessman. Michael understands the importance of copyrights and the role they play in the introduction to new technologies." He added that Jackson recognises Sony's "leadership in developing and realizing new technologies that serve to expand the creative horizon of artists such as himself". Administrative expertise was provided by Sony, who installed Paul Russell as chairman. Jackson was a company director and attended board meetings regularly. As each party in the arrangement held the power of veto, both sides would have to agree on a decision before it could be made. If neither party agreed on a decisions, they would not be implemented.

Recent history

In May 2001, Jackson denied rumours that he was planning to sell the Beatles' song catalogue. Rumours had circulated that the singer was to sell them in order to finance the upkeep of Neverland Ranch and to cover legal bill expenses. The singer announced in a statement, "I want to clarify a silly rumour - the Beatles catalogue is not for sale, has not been for sale and will never be for sale." Sony/ATV Music Publishing continued to acquire song catalogues in the 21st century. In November 2001, the company signed country singer Tony Martin to an exclusive songwriting and co-publishing deal. Through the deal, they acquired Martin's Baby Mae Music catalog of 600 songs, which includes Joe Diffie's "Third Rock from the Sun" and Jeff Carson's "Not on Your Love". In July 2002, Sony/ATV Music Publishing bought veteran country music publisher Acuff-Rose for $157 million. The venture included music publishing rights to 55,000 country music songs, including the music of Hank Williams, The Everly Brothers and Roy Orbison as well as the master recordings of the defunct label Hickory Records. Sony/ATV revived Hickory Records as the in house record label imprint in 2007, with distribution handled by Sony Music's RED Distribution.

Digital sheet music provider Musicnotes.com announced in June 2006 that they had signed a long-term distribution agreement with Sony/ATV Music Publishing. Musicnotes.com would produce and sell digital sheet music and guitar tablature for songs from Sony/ATV's extensive catalog. "As a music publisher, we are always looking for new and innovative ways to promote our songs and songwriters", Sony/ATV chairman and chief executive David Hockman announced in a statement. Another company acquisition was made in 2007, when Famous Music, a music publishing business with song catalogue of more than 125,000 songs including "Moon River" and "Footloose", was sold to Sony/ATV Music Publishing. The deal, sought by Viacom, included the assumption of around $30 million of debt. The company purchased the business for $370 million. The song catalogue also includes the hits of Eminem, Akon, Linda Perry, Bjork, Shakira and Beck.

Following Jackson's death in June 2009, it was revealed that Sony/ATV Music Publishing would keep control of the Beatles' songs. Upon his death, Jackson's entertainment attorney, Joel Katz, commented on the singer's work as a businessman. "Michael Jackson was a perfectionist and his business affairs are worldwide. Many of them are quite ongoing and will be dealt with appropriately." Ivan Thornton, a private-wealth adviser who worked with Jackson and his family, also commended the business side of the musician. "His business mind was fascinating. We’d go to meetings with bankers and Wall Street people and once I explained the language to him, he totally got it. There was no formal education there, but his natural knack was off the charts."

Value

The value of Sony/ATV Music Publishing has varied in reports. In 2002, Forbes magazine estimated Jackson's 50% stake in the company, along with other music publishing ventures, to be worth $450 million. The organisation was valued at $700 million in 2003. Industry experts valued the catalogue at between $600 million and $1 billion in 2004, based on the sales of rival catalogues. Charles Koppelman, a veteran music industry executive, stated that $1 billion was more reflective of Sony/ATV Music Publishing's worth. "Buyers would be lining up around the block if it were ever put up for sale", he said. "And I'd be in the front of the line." The value of the company was further estimated by Ryan Schinman, chief of Platinum Rye, to be $1.5 billion

In 2005, Jackson's defense attorney, Thomas Mesereau, revealed that the song catalogue had been valued at between $4 billion and $5 billion. The company's song catalogue is believed to generate up to $80 million a year; The Beatles' hits alone bring in $30 million to $45 million a year. Jackson's other publishing firm, Mijac, which publishes songs written by Jackson himself, is valued to be worth at least $75 million.


Timeline of Sony/ATV Music Publishing

1955 Lew Grade founds Associated Television (ATV).
1957 ATV acquires Pye Records as a wholly-owned subsidiary.
1957 ATV Music Publishing is created to exploit the songs owned by ATV.
1968 ATV Music and Lew Grade acquire the rights to the Lennon/McCartney song catalogue, Northern Songs.
1985 ATV Music Publishing and Pye Records are put up for sale. They are bought Robert Holmes à Court.
1985 ATV Music Publishing and it's assets, Pye Records and Northern Songs, are again put up for sale. Singer Michael Jackson acquires them for $47.5 million.
1995 Jackson merges ATV Music Publishing with Sony. He earns $90 million in the venture.
May 2001 Jackson declares that the Beatles' songs "will never be for sale".
November 2001 Sony/ATV Music Publishing acquires Tony Martin's Baby Mae Music catalogue of 600 songs.
July 2002 Sony/ATV Music Publishing buy country music publisher Acuff-Rose for $157 million. The venture includes publishing rights to 55,000 songs.
2007 Sony/ATV Music Publishing acquires Famous Music, a music publishing business with song catalogue of more than 125,000 songs.

 

[Moonwalker.Fan]

:wild: read this

“Michael & McCartney”
1980s-2009

 

[Moonwalker.Fan]

Article - http://online.wsj.com/article/SB10001424052748703438604575315364195884770.html

The Jackson estate and Sony have held talks about whether the company will again guarantee a refinancing of the debt backed by Mr. Jackson's Sony/ATV stake. If it won't, the estate could be forced to sell its stake in Sony/ATV at a steep discount, though that would still generate enough cash to wipe out the Barclays loan with hundreds of millions to spare. But Sony may have an incentive to reach a deal on refinancing, because buying out Mr. Jackson's estate would require it to pay hundreds of millions of dollars for an asset it already effectively controls.

Mr. Jackson's debts were spiraling out of control in other ways, too. A loan backed by Mijac carried a crushing 16.5% interest rate, to be paid out of royalties generated by the company. When the royalty payments fell short of the towering cost of servicing the debt, any unpaid interest was piled on to the principal. As a result, by the time of his death, the Mijac loan had reached $75 million, with $11 million due in annual interest, which was several million dollars more than the catalog was generating annually. The loan has now been refinanced with an interest rate of less than 4%. And thanks to increased album sales since Mr. Jackson's death and a new deal for public-performance royalties, the catalog is generating enough cash to pay off the refinanced loan a little more than a year from now.

 

[Moonwalker.Fan]

THE MEDIA BUSINESS; EMI to Pay Michael Jackson $70 Million to Manage Music
By ANDREA ADELSON

Published: November 25, 1993

The pop singer Michael Jackson said through his lawyer yesterday that EMI Music Publishing would begin managing his 6,000-title music catalogue, which includes most early Beatles hits, in a deal being described as the most lucrative in music publishing.

Mr. Jackson will receive $70 million in advance against revenue that EMI expected to generate managing the publishing rights to ATV Music. The catalogue, acquired by Mr. Jackson in 1985 for $47.5 million, includes the classic Lennon-McCartney Beatles compositions, as well as songs from Little Richard, Elvis Presley and the Pointer Sisters.

Total revenue over the deal's five-year term is estimated to be $150 million, said Martin N. Bandier, president of EMI Music Publishing, which controls 900,000 songs in its own catalogues. Financing for Acquisitions

As part of the deal, EMI had agreed to provide financing for acquisitions of other music catalogues in a partnership arrangement, in which EMI and the singer would share future ownership.

Such an arrangement increased the value of the deal, making it the largest in music publishing, according to John Branca, Mr. Jackson's lawyer.

 

[Moonwalker.Fan]

MICHAEL JACKSON SELLS RIGHTS TO BEATLES SONGS TO SONY
AP
Published: November 08, 1995

Michael Jackson, the singer, sold the music publishing rights to about 250 Beatles songs yesterday to the Sony Corporation for $95 million. A new publishing venture will combine Sony's music publishing division with Mr. Jackson's ATV Music catalogue to create a business valued at $500 million. In addition to the Beatles songs, Mr. Jackson's catalogue includes songs performed by Elvis Presley and Little Richard. Publishing rights to Mr. Jackson's own songs were not included in the deal. A spokesman for Mr. Jackson did not return a telephone call seeking comment. He bought ATV in 1985 for about $47.5 million.

 

[Go Flying]

nobody administer catalogs for 3%. Industry average is at 15-25% for big name artists. These could raise for smaller artists.

Not so Ivy. I know personally of 2 major artistes on 90/10 splits which were signed some years ago.

Back in the days, 70/30 with no cross collateralization, was the norm for a new artiste (with a decent lawyer) signed to a major label.

Michael negotiated a humungous 35% royalty rate for his records - He was well aware of the true value of publishing, so to think that he'd have settled for the 'industry average' for his own catalogue is just absurd

 

[Go Flying]

Guys let's do a Publishing 101 class here

First let's understand music - a songwriter / composer writes a song. He owns his song.

A musician deserves to be paid when his song is played. Radios have to pay royalties when they play a song, TV programs has to pay licensing fees when they use the song in their shows etc.

How will the musician collect these royalties / licenses , these money that he's supposed to get from the people that play/use his songs? Is he going to go door by door and ask them to pay him?

No. It's impossible for a musician to do this.

What happens is a musician forms a "catalog" and agrees with a "publishing" firm. Musician says to the Publishing firm "please collect the money I deserve from my song catalog and I'll give you a part of the money (anywhere between 20-50%) for the job you do".

So the "publishing" firm manages the catalog, it collects the money, gives a part of the money to the musician and takes a good fee for the work they do.

So in short Sony/ATV and Michael doesn't own the Beatles songs, they manage the publishing rights of the songs and get a percentage of royalties from the songs. In other words Lennon/McCarthy owns the Beatles songs but Michael gets a share every time someone buys/ plays/ uses a Beatles song.

Similarly Warner didn't own Michael's songs, they managed publishing rights an got paid for it - a high fee (anywhere around 20-50%) as the article says.

and Sony/ ATV won't own Michael's songs , they'll just manage publishing rights.

Now let's do some math - Assume that Michael earned each year $100M from his songs and the publishing firm got 40%.

With Warner - Michael would have gotten $60M and Warner would gotten $40M.

Assume the same scenario with Sony/ ATV.

Michael would have gotten $60M and Sony/ATV would gotten $40M.

but guess what Michael has 50% share in Sony/ATV so he gets 50% of what Sony/ATV makes - in this case he would have gotten in 50% of $40M

So if Sony/ATV manages his catalog Michael would get $80M and Sony would be left with $20M.

Does this make it clear now?


---------------------------------

Probably when he made the publishing deal with Warner , Warner was afraid that he'll take his catalog to his own Sony/ATV and they put a clause like he couldn't take the catalog from them until the 10th album etc. So the new releases can satisfy this clause in the contract and allow them take the catalog from Warner.

plus the article mentions the loan. as his catalog was used as collateral that might have stopped the move.

Ivy, with the greatest of respect, this is all fine basic stuff except that the numbers you use are ludicrous.

Run the numbers on a 90/10 split (imo worst case) now figure in the 'churn and burn' 15% of total transaction vig to B&M chargeable to the estate just for for doing the deal, and figure in an appropriate ongoing slice of the royalties for B&M (again probably 15% as any manager would expect).

Now look at the math and tell me that it's a wonderful deal.

 

[elusive moonwalker]

has this been offically anounced or are ppl just taking an article from friedman as fact?.

goon news in one sense cause why pay money out to warner to admin your songs when u can basically pay yourself and do it through sony/atv. but iam abit uncomfortable with everything being in one basket so to speak and how that would make it easier for those with bad intentions

 

[Graf]

has this been offically anounced or are ppl just taking an article from friedman as fact?.

goon news in one sense cause why pay money out to warner to admin your songs when u can basically pay yourself and do it through sony/atv. but iam abit uncomfortable with everything being in one basket so to speak and how that would make it easier for those with bad intentions

So far, I believe it's only friedman's article. Well, I know what you mean but I think they did this because since the estate owns 50% of the Sony/ATV catalog they figure if they are going to be linked with them then they may as well go all out. As well as the fact that Warner Music and EMI are up for sale and Sony/ATV is easily the biggest and most powerful publishing company atm.

 

[elusive moonwalker]

yeah the fact warner and emi are on their way out makes it perfect time to jump ship

 

[PCR]

I am still confused....
and uncertain....
but thanks so much for the great pieces of information provided!

 

[ivy]

Not so Ivy. I know personally of 2 major artistes on 90/10 splits which were signed some years ago.

Back in the days, 70/30 with no cross collateralization, was the norm for a new artiste (with a decent lawyer) signed to a major label.

Michael negotiated a humungous 35% royalty rate for his records - He was well aware of the true value of publishing, so to think that he'd have settled for the 'industry average' for his own catalogue is just absurd

Ivy, with the greatest of respect, this is all fine basic stuff except that the numbers you use are ludicrous.

Run the numbers on a 90/10 split (imo worst case) now figure in the 'churn and burn' 15% of total transaction vig to B&M chargeable to the estate just for for doing the deal, and figure in an appropriate ongoing slice of the royalties for B&M (again probably 15% as any manager would expect).

Now look at the math and tell me that it's a wonderful deal.

we can argue back and forth about hypothetical percentages for a long time. (and for my numbers I said "example and assume" - it's obvious that I made them up). It's all going to be assumptions and do not really matter.

there are two things that matter here
1) publishing doesn't mean owning the songs. it just means managing / collecting royalties/licensing money and getting a fee for that job
2) as the article states this was planned when Michael was alive