When you think about Taylor Swift and Ryan Coogler, do you think impact? You should. And the ’ownership economy’ is a big part of the reason.
Almost no one has ever said “the music industry is an equitable place.” Prince made this point years ago. John Fogarty of Creedence Clearwater Revival famously lost the rights to his own songs for decades.
Until the masters of Taylor’s albums were bought out from under her, though, it wasn’t a mainstream issue. But her response was an example of how ownership, value, and impact can align. Here’s how:
- She had the power, and fanbase, to do something with her intellectual property (she still owned the songwriting copyrights): You might have heard that she recorded “Taylor’s Version” of several of her albums. In doing so, she drove down the value of the masters that had been sold against her will.
Why did that drive down the value of the masters? Well, which version do you think her fans wanted to buy? Hers, or the version owned by someone other than her? The first two “Taylor’s Version” albums produced between three and ten times the sales and streams as the originals. Call that a blended 6:1 ratio. Which rights would you rather own, the six or the one? - She launched the highest-grossing tour in history and became a billionaire. If you don’t think artists can be businesspeople, you haven’t been paying attention. And if you think it’s only Taylor Swift, you’re definitely not paying attention.
- She bought back all of the masters of all of her music. That means she owns her entire catalog. In perpetuity. You might’ve noticed that was headline news in The Wall Street Journal…not a traditionally impact-facing publication.[Note: The WSJ cites a 3:1 “Taylor’s Version” to original ratio for streaming, not inclusive of sales. Call me silly, but one asset performing 300% better than another one is…a big deal.]
I wonder if there’s another move coming from Swift, or an artist like her: A record label, or studio, built to revert ownership rights to the original artists.
Imagine…a 10-year, or 20-year, ownership transfer period, after which everything flips. The right to the content reverts to the artist, while the studio maintains a minority royalty interest. Could it work? I suspect so. And at this point, would you bet against Taylor? Or Ryan Coogler (who negotiated his way to a 25-year deal like that for Sinners)? I wouldn’t.
Creative ownership
Coogler’s deal (with film industry giant Warner Brothers) is as interesting as Taylor’s buyback. For his blockbuster film Sinners, Coogler struck a deal that includes an immediate share of box office revenues (not only after the studio recoups its costs) and the rights to the movie after 25 years, entitling Coogler to streaming, licensing and merchandising revenue in perpetuity.
He told Business Insider that the motivation for negotiating ownership rights came down to something very personal: the familial origin of the story.
His grandfather and Uncle James grew up in Jim Crow-era Mississippi, where the movie is set, and their stories inspired the screenplay. “That act of listening to that music and feeling [Coogler’s Uncle James] was there with me is kind of what inspired the period setting and the blues. And that is why the movie is so personal,” he said.
Coogler has said that the Sinners deal is a one-off, driven by how personal the story is, and that he doesn’t plan to replicate the model. But creativity is among the most personal of asset classes, among the most difficult to replicate, and among the most challenging to predict. And current studio structures don’t make it easy to turn creativity into long-term wealth creation.
So what if Swift, or Coogler, decided to bet on an equitable-to-artists ownership structure at scale? Presumably, it would require a reengineering of traditional models. But it’s a place, much like creativity itself, where starting from scratch can unlock new value and new opportunity.
If either Swift or Coogler decided they wanted to take on the challenge, I’d bet on one, or both, of them pulling it off. And that would be betting on the impact, the arts, and the ownership economy, at the same time.
Mark Newberg is the President of Stockbridge Advisors, LLC, an impact management consulting firm. He’s a longtime subscriber to ImpactAlpha, an Innovator-in-Residence at the Lepage Center for Entrepreneurship and Innovation at Tulane’s Freeman School of Business, an Advisor to the Clayton Christensen Institute, and a Mentor-in-Residence at MassChallenge.
