Bob Dylan has done it, Shakira has done it, and Dolly Parton is reportedly considering it, presumably if the price is right.

Artists selling the rights to their back catalogues isn’t a new phenomenon, but if you’ve been paying attention recently you’ll know there has been a noticeable rush in recent months.

Dylan’s “landmark” agreement with Universal Music Group, announced in December, covers the copyrights to 600 tracks, from 1962’s anthemic Blowin’ In The Wind and 1964’s The Times They Are A-Changin, to last year’s Murder Most Foul. Reports on the amount vary from $300 to $600m, with a source with knowledge of the deal confirming to Sky News it was indeed a nine-figure sum.

After keeping hold of his rights for decades, is this a case of the 79-year-old protest singer finally selling out? Or sensibly making sure his affairs are in order? And it’s not just Dylan, but the likes of Neil Young, Debbie Harry, Fleetwood Mac’s Stevie Nicks and Mick Fleetwood… the list goes on.

Why the increase now?

With the rise of streaming, the way listeners consume music and the way artists make money from it has changed. Investors are able to see the value of evergreen hits, and are making offers that are hard to refuse. Touring being wiped out by the COVID-19 pandemic will also have had an impact on artists’ decision-making. Plus, there’s the arrival of a new president in the US, which could also be a factor.

Music journalist David Sinclair says the back catalogue “gold rush” has been brought on by “a perfect storm”.

He tells Sky News: “I think there’s an older generation of songwriters who’ve suddenly realised that there’s a tremendous value in the songs they’ve written over a long period of time that can be realised right now. And this has coincided with the realisation by certain investors that it’s a very good time to snap up any catalogues that are going. Money’s cheap at the moment, interest rates are very low.

“People like Bob Dylan and Neil Young and a lot of people who are now in their 70s, they’re being offered a payday which is about 20 times the equivalent to their annual salary, the annual amount of money that they would make from songwriting royalties.”

One company snapping up rights to thousands of songs is the UK specialist fund Hipgnosis, which over the past few years has acquired the rights to hits by everyone from Blondie and Barry Manilow to Timbaland and Mark Ronson.

Its founder, Merck Mercuriadis, said in a 2020 Guardian interview that music is “as good or better” than gold or oil, as it is always being consumed, no matter what is going on in the world.

The impact of COVID-19

With gigs cancelled across most of the world, artists will no doubt have spent much of 2020 wondering what the future holds for the industry.

When asked on Twitter after Dylan’s sale if he would be following suit, David Crosby, of Crosby, Stills and Nash, responded to say he would be – but didn’t seem too happy about it.

“I am selling mine also,” he wrote. “I can’t work… and streaming stole my record money… I have a family and a mortgage and I have to take care of them so it’s my only option… I’m sure the others feel the same.”

Many musicians will be thinking about “when exactly are they going to be able to play gigs in the old way?” says Sinclair.

“Even when they come back to playing gigs there’s not going to be these huge, densely packed audiences that have become the norm over all this period of time. It’s going to be a much different economic model altogether, if it even comes back at all in the same way.”

Tax benefits

When artists receive income from annual royalties, high earners will pay income tax of around 40% on the majority, each year. Sold in a lump sum, they pay a one-off capital gains tax – currently 20% in the US, although Joe Biden plans to increase this to about 40% for those earning more than $1m a year.

“These guys are being advised very much by their financial wizards,” says Sinclair.

“If you’re toying with the idea, if you’re a rock and roll star, if you’re Bob Dylan, and you’re thinking to yourself, ‘this might be the time’… [he’s] getting 20 years’ income in one year, right there in a lump sum – it’s taxed at half the rate that it would otherwise be taxed going forward in the other way, and it might not be being taxed like that for very long.”

Personal reasons

A lot of the artists selling their rights are in their 70s. While the cash in the bank may be a big incentive, they may also be thinking about potential difficulties for their families after their deaths.

Philip Wesley, a pianist in Nashville, sold the rights to his back catalogue in 2019 for $4.25m, after the previous year saw his music streamed more than 150 million times.

“It never really was on my radar to sell my catalogue,” he tells Sky News. “[It] didn’t cross my mind until I was approached about it and I thought about it. And I talked to my family and we thought it was a good idea.

“I’m not going to be around forever, I am getting older. And my family, they’re not really privy to the music business and so I don’t think they would, after I’m gone, want to figure out how to navigate the music business, track down royalties and all that kind of stuff.

“So the catalogues have been doing very well for many many years so I just felt like between my age and getting older and my family’s resistance or hesitance to work the music business, I thought it was a good time for me to sell.”

Dolly Parton said she was considering for similar reasons in an interview with Music Week in December, saying: “It’s very possible that, for business reasons, estate planning, and family things, I might sell the catalogue I have now. I’ve often thought about it and I’m sure that I could get a lot of money for it.”

Selling out?

Dylan’s sale certainly raised a few eyebrows. But with all those millions in the bank, it’s probably unlikely he cares. The idea that our much revered rock and roll stars aren’t at all motivated by money is “a mirage”, says Sinclair.

“None of them got to the positions that they’re in by wilfully ignoring commercial opportunities along the way. These are very, very savvy business people, whatever the fans might think in an idealistic way.”

And selling out perhaps doesn’t have quite the same negative connotations it once did.

“I remember one of my favourite artists did an interview – and it sort of formed my opinion as a teenager – saying, ‘If your song is on an advert, that’s terrible because you’ve taken someone’s feelings and now you’ve attached them to soap powder’,” says Paul Stokes, another British music journalist. “And that same artist did a car advert about 18 months ago…

“But also, it’s quite clever, actually, because that song was probably languishing in the back catalogue. You know, it was a big single 30 years ago, but now people are going ‘oh yeah, that’s a great song’. And that’s one of the upsides, obviously, if you have a song on a car advert, people can find it immediately.

“They don’t have to watch the car advert 27 times to work out what the song is, they can just stream it straight away.”

Why are investors willing to pay so much?

One British sale announced earlier in January involved the rights to some of Take That’s earliest hits, sold by producer Ian Levine to publisher One Media iP Group.

The deal covers producer royalties (rather than songwriting) to tracks from the group’s twice-platinum 1992 debut album Take That & Party – including Could It Be Magic and A Million Love Songs.

“Music rights are very much the epicentre of the way the music industry works,” says chief executive Michael Infante.

“What we have now is I think a recognition from fund managers in the City who have suddenly realised actually it’s quite a robust recurring income.”

One Media has several deals in the pipeline, he says.

“I think we’re going to see a lot more of this. I think over the next six to 12 months, you’ll be hearing more news from us and probably a lot more news from others.”

Due to non-disclosure agreements, he can’t name names at the moment, “but expect more in the same vein”.

Big-name deals of recent years

Bob Dylan aside, here are the other artists and producers who have sold their rights in the past few months.

• Fleetwood Mac‘s Stevie Nicks, Lindsey Buckingham and Mick Fleetwood have all announced separate deals in the past few weeks. Nicks sold an 80% stake in her music to Primary Wave for a reported $100m in December, while Buckingham sold his publishing rights to Hipgnosis in early January. Fleetwood’s interests in his band’s recordings have been acquired by BMG, one of the world’s biggest music publishers, in a deal that covers more than 300 songs – including Dreams, The Chain and Go Your Own Way, from their biggest-selling album, Rumours.

• Singer-songwriter Neil Young, 75, sold a half-share of the rights to his entire catalogue of 1,180 songs to Hipgnosis in the first week of January. Financial details of the deal were not disclosed. “I bought my first Neil Young album aged seven,” said Mercuriadis as the announcement was made. “Harvest was my companion and I know every note, every word, every pause and silence intimately. Neil Young, or at least his music, has been my friend and constant ever since.”

• Colombian pop superstar Shakira also sold the rights to her catalogue, featuring 145 songs, to Hipgnosis earlier in January. “Each song is a reflection of the person I was at the time that I wrote it, but once a song is out in the world, it belongs not only to me but to those who appreciate it as well,” she said, adding that her songs had found “a great home”.

• Beats and Interscope co-founder Jimmy Iovine is another producer who sold his rights to Hipgnosis early in January, including albums by John Lennon, Bruce Springsteen, Patti Smith and U2, as his film production royalties for two films he co-produced: Eminem’s 8 Mile and 50 Cent’s Get Rich or Die Tryin’.

• In 2019, the music rights deal making headlines was the acquisition of Taylor Swift‘s back catalogue by music mogul Scooter Braun, a man she accused of bullying her. He didn’t buy the rights from Swift, but acquired the label she was with for her first six records. In November 2020, he sold on his share of Swift’s music to private equity firm Shamrock Holding, with reports saying it went for around $300m (£227m) – and the singer saying he had denied her the chance to buy the rights back.

• The Killers sold their catalogue from before 2020, including hits such as Human, When You Were Young and Mr Brightside, to Eldridge, a holding company with a network of businesses across entertainment, finance, technology, and real estate, in November 2020.

• Bob Rock, a producer of songs by artists including Metallica and Michael Buble, sold his rights to 43 songs to Hipgnosis, including Metallica’s album Metallica, as well as Buble’s Call Me Irresponsible, Crazy Love, Christmas and To Be Loved