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How Michael Got the Beatles Catalogue & ATV Music Publishing

Acquisition

Michael Jackson acquired ATV Music Publishing in 1985 and merged it with Sony a decade later.
By the mid-1980s, ATV Music Publishing and Pye Records were both up for sale. The companies were bought relatively cheaply by Australian businessman Robert Holmes à Court, who asset-stripped them and sacked many long serving employees, before selling them on again.[5][6][7] During this time, American singer Michael Jackson was recording "Say Say Say" for Paul McCartney's Pipes of Peace album. Jackson stayed at the home of McCartney and his wife Linda during the recording sessions, becoming friendly with both. One evening whilst at the dining table, McCartney brought out a booklet displaying all the songs to which he owned the publishing rights.[8] He explained that music publishing was a way to make big money. Jackson replied by telling McCartney that he would buy The Beatles' songs one day. "Great. Good joke", McCartney laughed.[8]
Shortly afterward, John Branca, Jackson's attorney, advised the singer that the Northern Songs catalogue was up for sale. Warned of the competition he would face in buying such popular songs, Jackson remained resolute in his decision to purchase them.[9] Branca approached McCartney's attorney to query whether the Beatle was planning to bid. The attorney stated he wasn't; it was "too pricey".[9] McCartney had previously attempted to purchase Northern Songs alongside John Lennon's widow, Yoko Ono in 1981 for $20 million; the pair would each pay $10 million. Ono refused as she thought it was too high a price. Not wanting to spend the $20 million himself, McCartney let the sale fall through.[9] After months of negotiating, Branca closed the deal and purchased Northern Songs on Jackson's behalf for $47.5 million.[9]
In an analysis of the acquisition, Los Angeles Times noted that if "Yesterday" were to earn $100,000 a year in royalties, the Lennon estate and McCartney would divide 50% of the income; $25,000 each. The publisher, Jackson, would receive the other 50%; $50,000. It was added that "Yesterday" in particular would earn considerably more than $100,000 a year. The publisher would also control the use of the song in films, commercials and stage productions.[9] Jackson went on to use the Beatles' songs in numerous commercials, feeling that it would enable a new generation of fans to enjoy the music. McCartney, who himself had used the Buddy Holly song catalogue in commercials, felt saddened.[9] Privately, Jackson was reported to have expressed exasperation at McCartney's attitude; he felt that the musician should have paid for the songs he had written.[9] At the time, McCartney was one of the richest entertainers in the world, with a net worth of $560 million and a royalty income of $41 million.[9] Jackson stated, "If he didn't want to invest $47.5 million in his own songs, then he shouldn't come crying to me now".[9]
Ono was pleased that Jackson had acquired Northern Songs and called it a "blessing".[9] Speaking in November, 1990, Ono stated, "Businessmen who aren't artists themselves wouldn't have the consideration Michael has. He loves the songs. He's very caring."[9] She added that if she and McCartney were to own the songs, there would certainly be arguments. Ono explained that neither she or McCartney needed that. "If Paul got the songs, people would have said, 'Paul finally got John'. And if I got them, they'd say, 'Oh, the dragon lady strikes again'".[9]

From: http://en.wikipedia.org/wiki/Sony/ATV_Music_Publishing

Comments (19)

(imitates Michael) I love you most (hee, hee lol lol).

I knew you would have Dorita...of course anything MJ AND OZ. Love to yah.

I already have these saved and they are just wonderful memories. Smiling Smiling Smiling

http://www.youtube.com/watch?v=3htpIVyUtec
Here's another one this is cool. An insight into MICHAEL 1985 AUSTRALIA
Told yah I have a clip for evey occassion.LOL.

I remember it well, loveyoumost. I've seen this footage and recall it quite vividly like it was yesterday, and I've mentioned it previously that it's further proof of Michael's outpouring of philanthropical efforts.

Dorita Michael was not only a fantatsic business man, he also had ROBERT HOLMES A COURT give a sizeable donation to the telethon for the signaturte of Michael on that day in Perth. While there, Robert Holmes a Court's wife took Michael book shopping in Fremantle.
http://www.youtube.com/watch?v=gJx6bzGu5IQ

lyl, and everyone, thank you for all very useful information. God bless!
I'm always amazed how great, smart and wise businessman Michael was.

Nadia and ethemer, thank you VERY much for your explanation and your patience, for taking the time to find this information. It's all pretty clear to me now!!
I apologize for any discomfort my questions might have caused Sad Now I see how many misunderstandings come from a lack of information! Thanks again, girls!
LOVE, HUGS
Jeaneth XO

<em>Jeaneth: Shouldn't Paul's songs belong to Paul? I understand he didn't want to pay 20million for his own songs, which sounds fair enough to me! Sometimes I think art should not be comercialized, because the creator might walk away without something he created, which might very well be dear to him. Why wouldn't Michael stay out of bidding for this catalogue? I wouldn't want to be the one to take away somebody's creation just 'cause I'm bidding the highest for it.
</em>
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@Jeaneth:

A common misconception about Michael's purchase of the catalog is that he bought Lennon and McCarney's songs out from under them, but this is not true. McCartney and Lennon wrote most of their songs, and owned the rights to those songs they wrote. But songs have to be used to make money, so songwriters typically sell the publishing rights to their songs to music publishing companies. These publishing companies promote and market the song and manage licensing for the songs use, such as in film soundtracks or printed sheet music or when performed or recorded by other artists. Artists also get performance royalties for their recordings. All these various uses of the songs earn their own royalty rates, which may be a fixed rate per use, or may be a percentage of sales per unit, depending on the license. When a songwriter assigns a music publisher to his/her songs, the publishing or ownership royalties are split between the publisher and the songwriter. The percentage of the split varies, but it is typically 50/50. But the writers still receive 100% of the songwriter royalties.

In 1963, the Beatles assigned their publishing rights to Northern Songs, which was a publishing company formed by their manager, Brian Epstein, and music publisher Dick James. By 1965, the Beatles' earnings from record sales, performances, all the various royalties became so high that they were losing 90% of their income to taxes. To remedy this, they went public with their publishing company, putting Northern Songs the London Stock Exchange. Dick James and the Charles Silver of Norhtern Songs held 37.5% of the shares the now public company; Lennon and McCartney each retained 15% of the shares; Brian Epstein owned 7.5%, and Harrison and Starr owned 1.6%.

In 1969, publishers James and Silver sold their 37.5% of the company to the head of Associated Television Corp. (ATV). ATV outbid the Beatles for their shares in the buyout of Northern Songs. So, the Beatles gave up all their publishing rights 15 years before Michael was ever involved. ATV bought numerous other catalogs, which included the songs of Little Richard and Lieber & Stoller, who were the songwriters of several 50s/60s hits recorded by the Drifters, the Coasters, and Elvis, including songs, "Jailhouse Rock" and "Hound Dog".

By 1984, the ATV catalog containing over 4000 songs, including most of the Beatles' songs from the 1969 Northern Songs acquisition, was put up for sale. Paul McCartney was among the bidders interested in buying the ATV catalog, but Paul was outbid because he was only interested in buying back the rights to the Beatles' songs and apparently did not want to pay for the thousands of other songs in the catalog. Michael eventually outbid all prospective buyers at $47.5 million.

Michael's purchase gave him 100% ownership of the catalog. So, in the typical 50/50 deal between songwriter and publisher, that means Michael got 50% of the publisher royalties to all the songs, and the various songwriters got their 50% of the publisher royalties. The songwriters still get their full songwriter royalties. Regarding the Beatles' songs specifically, Michael earned 50% of the publishing royalties, McCartney and Lennon's estate split the other 50% of the publishing royalties. McCartney and Lennon still receive 100% of the songwriter royalties, which they split 50/50 between them.

In 1996, Michael sold 50% ownership of the catalog to Sony for $90 million and retained the other 50% in a merger that created the Sony/ATV catalog. Today, the catalog contains over 500,000 songs. Michael's 50% ownership of the Sony/ATV catalog was passed to his estate when he died.

Sources:
http://entertainment.howstuffworks.com/music-royalties.htm
http://www.snopes.com/music/artists/jackson.asp
http://en.wikipedia.org/wiki/Lieber_and_Stoller
http://en.wikipedia.org/wiki/List_of_Sony/ATV_Music_Publishing_artists
http://en.wikipedia.org/wiki/Associated_Television

@jeaneth120, this is the way I think it works:

Back in the day, all songs you wrote while under contract with a record label, belonged to that label. You could negotiate the ownership of your own songs during a renewal of the contract or with a change of record company. This has changed over the years and now the songwriter always owns his songs. Anyway, I'm pretty sure The Beatles own their masters.

But ownership and publishing rights (copyright) are two different things.

The Beatles own their songs, however the publishing rights belong to ATV/Sony. That means only ATV/Sony decides what songs will be released, whether they will be used in a commercial, for a video game, ....The Beatles will get paid a royalty fee for everytime their songs are used for whatever reason though.

Just like Michael owns his music in the MiJac catalogue, but the publishing rights belong to Sony till 2012 and now with this new deal untill 2017 (including all new material the Estate discovers).

After the contract expires, the artist can either start releasing their own songs on their own record label, or they can renew /renegotiate their deal with the current record company or they can take their business to another record company/highest bidder.

@Lyl, thanks for this post. I wish more people would do the research.

Thanks lyl for refreshing my memory of the catalogue. He inquired if Paul was going to purchase the catalogue but nope so it was open range for Michael. An amazing businessman.

Please girls explain to me how this works, I don't know anything about business. Shouldn't Paul's songs belong to Paul? I understand he didn't want to pay 20million for his own songs, which sounds fair enough to me! Sometimes I think art should not be comercialized, because the creator might walk away without something he created, which might very well be dear to him. Why wouldn't Michael stay out of bidding for this catalogue? I wouldn't want to be the one to take away somebody's creation just 'cause I'm bidding the highest for it.
Give me your comments please!
LOVE
Jeaneth

Ivan was spot on as Michael had quite a knack for the business side of the music industry, not just the art itself.

I loved it when it said:

"Ivan Thornton, a private-wealth adviser who worked with Jackson and his family, also commended the business side of the musician. "His business mind was fascinating. We’d go to meetings with bankers and Wall Street people and once I explained the language to him, he totally got it. There was no formal education there, but his natural knack was off the charts."

Whether or not people choose to believe it, Michael had a great nous for business and a wonderful acumen too.

Furthermore of his acquisition of the Beatles catalogue - I remember like it was yesterday. In 1985 also, while on the verge of clinching the deal, Michael attended a telethon in Perth (after a stopover in Sydney) where the late Sir Robert Holmes a Court was a patron of and Molly Meldrum was one of the hosts. Michael even gave a hat to a young disabled girl on the night. That was just so sweet and charming, and proved what a philanthropist Michael really was.

Thanks, lyl, I enjoyed the details of this deal, the gist of which I had read before. I like, "Warned of the competition he would face in buying such popular songs, Jackson remained resolute in his decision to purchase them.[9]" He "remained resolute" in many ways in his life. He set his mind to do something and do it he did. I find this amazing. Of course when you have all his talent this is easier to do than if you don't.

Its an amazing business deal the list of artists under that catalog is huge wish more people would research this deal

Michael just did good business. The media makes it seem like he stole it from paul. Ono's right they should be blessed that the catalogue went to someone that loved and understood music. It didn't go to some greedy business man. Michael had a great respect for music.Michael just simply did good business. I read somewhere that he was already a billionaire in the 80's. I also heard from several business men like Donald trump that Michael was a very smart business man. I think in that context he's very underated. I think Michaels only issue was that the people in charge of his money weren't doing a very good job. Michaels right as cold as it may sound don't come crying to me now when you had possibility of purchasing the songs yourself.

Other published reports further state Michael reached out to Paul McCartney letting Paul know that he (MJ) was going after the catalog if McCartney was not pursuing it and that McCartney stated that the he (McCartney) was not pursuing the catalog because the price had risen above what McCartney was willing to pay, with McCartney stating that those were his songs to begin with and McCartney felt, on principle, that paying that amount of money to 'buy' back his songs was outrageous. And as the article above stated, at the time the catalogue went on sale, McCartney was reported to be one of the riches entertainers in the world with McCartney's networth far surpassing MJs.