In the photo above, we see Michael Jackson signing a contract with Sony. This is the very moment he co-founded Sony/ATV — the music publishing company that houses the largest number of songs, including the entire Beatles catalog — with Sony in 1995. The company is now worth at least $2 billion, with half of it belonging to the Michael Jackson Estate and forming a vast inheritance for his children. However, news has recently emerged that this partnership may be at risk, as Sony has activated a clause added to the agreement later in 2006 — when Michael was in debt and in financial need — under which either party may purchase the other's entire stake.
Analysts have interpreted this Wall Street Journal report in different ways.
Some believed that Sony intends to sell its stake to the Michael Jackson Estate. But an equally plausible reading is that Sony may be looking to acquire Michael Jackson's stake and multiply the profits from music sales. It should not be overlooked that the Sony/ATV catalog is the world's largest music publishing entity, accounting for 30% of the total music industry's revenue.
Sony/ATV has been a 50-50 partnership between Michael and Sony since 1995. The famous Beatles catalog and other works that Michael purchased in 1985 for $47.5 million were merged ten years later with songs whose publishing rights Sony held, creating the Sony/ATV partnership, which today contains approximately 750,000 songs.
After Michael's passing, in 2012 his Estate also merged his personal song catalog — which had been held under the Mijac name since the 1980s — into Sony/ATV.
So why has Sony waited so many years to activate this contract clause? The answer is that the music industry's revenue today is far lower than in previous years. Artists don't sell as much as before, and the Sony/ATV catalog — a blend of classic songs and the works of today's most famous artists — accounts for 30% of market revenue. It is therefore natural for the company to seek full ownership of the catalog, or alternatively to relinquish its stake in exchange for greater influence.
No statement has yet been issued by the Michael Jackson Estate on this matter.
Source: eMJey.com / Showbiz411
In the photo above, we see Michael Jackson signing a contract with Sony. This is the very moment he co-founded Sony/ATV — the music publishing company that houses the largest number of songs, including the entire Beatles catalog — with Sony in 1995. The company is now worth at least $2 billion, with half of it belonging to the Michael Jackson Estate and forming a vast inheritance for his children. However, news has recently emerged that this partnership may be at risk, as Sony has activated a clause added to the agreement later in 2006 — when Michael was in debt and in financial need — under which either party may purchase the other's entire stake.
Analysts have interpreted this Wall Street Journal report in different ways.
Some believed that Sony intends to sell its stake to the Michael Jackson Estate. But an equally plausible reading is that Sony may be looking to acquire Michael Jackson's stake and multiply the profits from music sales. It should not be overlooked that the Sony/ATV catalog is the world's largest music publishing entity, accounting for 30% of the total music industry's revenue.
Sony/ATV has been a 50-50 partnership between Michael and Sony since 1995. The famous Beatles catalog and other works that Michael purchased in 1985 for $47.5 million were merged ten years later with songs whose publishing rights Sony held, creating the Sony/ATV partnership, which today contains approximately 750,000 songs.
After Michael's passing, in 2012 his Estate also merged his personal song catalog — which had been held under the Mijac name since the 1980s — into Sony/ATV.
So why has Sony waited so many years to activate this contract clause? The answer is that the music industry's revenue today is far lower than in previous years. Artists don't sell as much as before, and the Sony/ATV catalog — a blend of classic songs and the works of today's most famous artists — accounts for 30% of market revenue. It is therefore natural for the company to seek full ownership of the catalog, or alternatively to relinquish its stake in exchange for greater influence.
No statement has yet been issued by the Michael Jackson Estate on this matter.
Source: eMJey.com / Showbiz411