Jun 1, 2023 - Economy

Music deals get louder on reports of $1b record for Queen catalog

Illustration of Ben Franklin making the hardcore hand symbol.

Illustration: Maura Losch/Axios

Universal Music Group is in talks to buy Queen's music catalog from Disney for more than $1 billion, according to multiple reports.

Why it matters: Disney is denying that it intends to sell off its British rocker royalties, let alone for a record amount, but even just the chatter is reflective of how music deals have become a thriving, cottage industry.

  • Queen's catalog may or may not change hands for more than $1 billion, but that price is imaginable in a way it wasn't just a few years ago.

The big picture: For every deal involving the music of a big-name artist, like Bruce Springsteen, Taylor Swift or Justin Bieber, there may be a hundred for relatively-unknown musicians, producers and writers.

And that's being driven by three primary trends, according to Mike Poster, music financing chair at law firm Michelman & Robinson:

  1. Expanding universe of buyers and sellers. On the buyside, that includes dedicated private equity funds and PE-backed management teams that roll up music assets. For sellers, it's about leveraging a new financial planning tool.
  2. Valuations are rising on the wings of an increased number of licensees (e.g., Roblox, Peloton) and an increased number of performance royalties (e.g. streamers).
  3. Royalty rates themselves are climbing, often driven by statute.

In the weeds: It's important to recognize that music deals are often bespoke, and what one includes another may not. Thus it can be difficult to make apples-to-apples price comparisons.

  • For example, there are different sorts of royalty streams (mechanical, sync, performance).

The bottom line: For Queen and its peers, the tablature points up and to the right.

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