Streams are a key success, but it’s radio that is more lucrative for the King of Pop
Michael Jackson has topped Forbes’ list of 2019’s Highest-Paid Dead Celebrities list. This is Jackson’s seventh consecutive year, and ninth time, since his death in October 2009, that he has topped this list, released in November.
Jackson’s estate – headed by his former attorney, John Branca, and music industry executive John McClain – brought in $60 million in 2019, taking the King of Pop’s posthumous earnings to an incredible $2.46 billion. In comparison, Elvis Presley – the second highest-paid musician over that period – has earned $530 million.
Much of Jackson’s earnings in death have come from the sales of his stakes in two enormous music publishers. In 1981, Jackson stayed at Paul McCartney’s home where they collaborated on songs such as “Say Say Say.” The pair discussed music publishing with McCartney explaining the lucrative business of purchasing the rights to other songwriters’ songs to earn royalties from them.
A fascinated Jackson joked that he would one day buy the Beatles’ back catalogue, which he did four years later when he purchased ATV Music containing the entire Lennon-McCartney catalog, for $47.5 million. McCartney – who will headline Glastonbury in 2020 after being favorite at Betway – wasn’t happy, but Jackson told him it was “just business.”
ATV and Sony later merged where it formed the world’s largest music publishing company. In 2016, Jackson’s estate sold his 50 percent stake in Sony/ATV for $750 million, more than 15 times his original investment. Two years later, Sony paid $287.5 million to Jackson’s estate to acquire a 9.8 percent share he owned in EMI Music Publishing. These two deals contributed to over $1 billion to his estate.
Jackson’s own songs remain incredibly lucrative. In January Broadcast Music Inc (BMI) extended its 41 year deal to represent his back catalogue where it will continue to collect royalties from radio, television and internet broadcasts.
“Jackson’s deal with BMI speaks to the importance of back catalogue to radio, which is the largest source of income that a writer will earn on his songwriter royalties,” shares Barry Massarsky, an economist who specializes in the valuation of music catalogues.
“I would say that at least half of his revenue is coming from radio.
“It’s remarkable that we talk about streaming, downloads and so forth, but streaming for a large base is really confined to current pop and R&B/urban music.
“People who continue to listen to commercial radio in the United States are older, because younger listeners have gravitated to streaming.”
Massarsky says the deal is particularly valuable to BMI because of trends within the radio industry, where over 55 percent of airplay in the United States is identified as songs that aren’t current, known as “golden” music. That means that radio stations “are skewing towards an older demographic and therefore they are playing an older inventory of music”. Jackson’s catalogue, meanwhile, is “highly valued” simply because he’s responsible for “so much of that hit-driven material from 30 to 40 years ago.”
Although radio is the driving force behind the value of Jackson’s back catalogue, he remains hugely popular on streaming services. He has 13 million followers on Spotify – more than contemporary artists Future and J. Cole – and currently ranks 101st in monthly listeners with 21 million.
Bob Marley, Whitney Houston, Amy Winehouse, John Lennon, Price and David Bowie are among those who have had lucrative posthumous careers. Streaming, radio airplay and special releases have all contributed to their wealthy estates.
