overview

This note considers corporate ownership of music, literature and other copyright (sometimes described as 'rights catalogs' or 'rights libraries') and the activity of rights agents.

It covers -

• introduction
• history
• valuation
• studies

It supports the discussion of intellectual property elsewhere on this site (including consideration of publicity rights, aka personality rights) and the complementary notes on authors' estates and collective rights administration (aka copyright collecting societies)

     introduction

Corporate ownership of copyright in works that were created by individuals (as distinct from created by/for organisations) is an unsurprising consequence of intellectual property regimes that treat intellectual property as something that is alienable and that can thus be traded.

The past fifty years has seen increasing recognition of intellectual property as a commodity that can be bought and sold by publishers, financiers and by non-specialist businesses. That recognition has been reflected in the development of large-scale rights libraries - in essence investment in creation and commercial explotation of rights to reproduce (including perform) musical scores and lyrics, still images, motion pictures and text.

It has also been reflected in an assessment that the true value of many film studios, record companies and broadcasters lies in their 'back catalogue' (ie licensing of past productions) rather than in their production facilities and associated assets such as cameras, sound stages, recording studios and props.

One result is that private equity has aggressively sought to aggregate disparate rights catalogues by acquiring small publishing companies and buying rights off individual rights holders (including heirs to the estates of many 20th century authors). A corollary is that restructuring of the film and record industries during the past thirty years has seen leading businesses shed their production facilities in favour of acquiring historic rights catalogues. That has been accompanied by accumulation on the part of Corbis and Getty Images, two corporations that have gained dominant positions as owners (or as agents for the owners) of still and moving image copyright works.

It has also been accompanied by expressions of concern regarding 'information feudalism', expressed most elegantly in works such as Peter Drahos' Information Feudalism: Who Owns the Knowledge Economy (London: Earthscan 2002) that highlight the concentration of intellectual property in a handful of multinational corporations.

     history

Contrary to some alarmist reports, corporate rights libraries are not a particularly new development.

Publishers of music (scores and lyrics) and literature (fiction, journalism and technical publications) often acquired all or some rights from authors - at the time of a work's creation or thereafter - on terms that may or may not have been equitable. Several of the major music publishers thus trace their origins to small publishing houses that predate contemporary copyright law and through the longevity of their operation have accumulated major collections of works from creators who are now famous or who are now obscure.

Film studios (including production groups outside Hollywood) similarly accumulated major catalogues through film production or through acquisition of competitors (and hence rights to their production base) during the bouts of consolidation evident every generation. The dismantling of the 'Studio System' in the US during the 1950s and 1960s saw a trade in film rights, with acquisition by television networks and speculation by figures such as Kirk Kerkorian. It also saw exploitation of rights in scientific and other journals by predators such as Robert Maxwell, whose move into the mass media was funded by rivers of gold from technical journals whose authors surrendered their rights as a condition of publication.

The following ten years saw corporate acquisition of rights in works by particular authors (eg UK food group Booker-McConnell bought rights to Agatha Christie's novels and Ian Fleming's novels as part of its diversification) and music publishing houses sought to buy - rather than licence - rights from the heirs of modernist composers. As indicated above, that purchasing was founded on copyright as something that can be bought/sold and that typically lasts for the author's life plus several years (irrespective of whether the copyright is owned by an individual, by the individual's family or by another entity such as a corporation).

The trade in rights became more active during the 1980s, marked by media coverage of deals that saw entrepreneurs such as Robert Holmes a Court, Ted Turner and Michael Green trade existing film libraries - increasingly valuable as a way of cheaply feeding free to air and pay television - and individuals such as Michael Jackson pay large sums for rights to the Beatles song catalogue or other music collections.

That activity foreshadowed more recent takeover by private equity groups of major record companies such as EMI (typically followed by outsourcing of production), technical publishers and other businesses, which were encouraged to gain the rights held by their smaller competitors.

     valuation

Points of entry to literature on the valuation of music catalogues and other rights collections are provided in Valuation of Intellectual Property & Intangible Assets (New York: Wiley 2000) by Gordon Smith & Russell Parr, Management of Intellectual Property (Cheltenham: Elgar 2006) edited by Derek Bosworth & Elizabeth Webster, Entertainment Industry Economics (Cambridge: Cambridge Uni Press 1998) by Harold Vogel and Valuing Intellectual Property in Japan, Britain and the United States (London: Routledge Curzon 2004) edited by Ruth Taplin.

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