Last week’s sale of Bob Dylan’s publishing catalog to Universal Music Publishing Group may have set a couple of records. The price is thought to be between $375 million and $400 million, based on the $11 million to $14 million Dylan’s catalog generates every year, according to sources familiar with the business. Both the amount and the multiple of between 27- and 36-times annual revenue are unprecedented.
Publishing business sources have said Dylan’s catalog was sold for a multiple of almost 30. To put that in context, most catalogs sell for an average of 16-18 times net publisher’s share (NPS), or gross revenue after songwriter royalties are paid. Some recent deals have involved multiples in the low 20s, but no previous deal seems to have gone as high as 26-times — let alone over that. (The annual revenue for Dylan’s catalog fluctuates depending on synchronization deals and special projects.) Although publishing values are usually discussed in terms of multiples, transactions like this are far more complicated, and the fact that Universal could acquire all rights to all of Dylan’s songs presumably raised the price.
Dylan could also have another deal in his future that’s half as big. Dylan owns all of his master recordings, sources with knowledge of his deals tell Billboard, and he has been licensing them to Sony Music Entertainment since he regained ownership at some point in the 1980s. Dylan received a big advance in his most recent licensing deal, according to those sources, which likely means that Sony controls the masters until that money is recouped. When it is, Dylan could also sell these rights — in a deal that could be worth another $200 million, according to standard industry valuations.
It’s likely that Dylan’s team is already negotiating with Sony. After losing its deal to administer Dylan’s publishing in the world outside the U.S. — the current contract runs a few more years — the company has an incentive to try to continue to control Dylan’s recordings. (That could mean another long-term licensing deal as well as a sale.) If Dylan chooses to sell the recordings, they could also be shopped to Universal Music Group or other potential buyers, although Sony may have first right of refusal or the right to match the highest offer.
Both Sony and Dylan’s team declined to comment for this story.
Dylan’s recordings generated about $5 million in the U.S. in 2019, Billboard estimates, and iconic rock artists usually make about half their revenue in other countries. So the total revenue could add up to between $12 million and $13 million once synchronization and neighboring rights are included. (Although recordings generally generate far more revenue than publishing catalogs, that’s not true in Dylan’s case because of the vast number of successful cover versions of his songs.) Although recorded music rights don’t trade for as high a multiple of annual revenue as publishing assets, those prices are also rising — to about 12 to 15 times “net label share,” or the money left after deducting royalties, production costs, manufacturing and distribution. That implies a value of almost $200 million.
It’s also possible that, years from now, Dylan or his estate could line up yet another significant deal. Under the 1976 Copyright Act, songwriters can terminate publishing agreements after 35 years for songs created after 1978. Even though many of Dylan’s songs date from before then, the Universal deal is after 1978, so it’s also subject to the 35-year termination timeline. Universal’s purchase of Dylan’s catalog would be subject to this in the U.S. — although not elsewhere. Dylan’s publishing probably generates about half its revenue in the U.S., based on industry patterns, which implies a current value of close to $200 million — although its value in the future would be affected by any number of factors, including the term of copyright (right now the life of an author, plus 70 years), the law at the time, the health of the music business and the broader economy, and other factors.
(Dylan’s publishing was never shopped to a buyer other than Universal, although Dylan’s team sent out some financial information about the catalog to get a sense of what kind of price it could command.)
If Universal only has 35 years to make back what it spent to buy Dylan’s publishing in the U.S., that gives the company just over a five-year cushion to make a profit, assuming the price involved multiple of almost 30. It the company can increase revenue — which seems likely, given that it will presumably seek out synchronization deals more aggressively, its cushion, and profit, would grow. Even if it can’t maintain that level of revenue, however, the deal significantly boosted Universal’s prestige at a time when its publishing division is locked in a battle for market share with Sony/ATV. The deal also cements Universal as a dominant company in a thriving business as it prepares to offer its upcoming IPO to investors. (Universal also declined to comment.)
One executive involved in music asset purchases assessed the Dylan deal “as probably a loss leader,” but it will have other value. “It’s Bob-fucking-Dylan,” says a retired industry veteran. “I don’t care what you pay: 100 years from now, people will know his name in the same way they still know Mozart today.”