In 1985, Michael Jackson bought the rights to the Beatles record catalog along with the rights to other artists' songs for $47.5 million. In 1995, he sold half the rights to Sony for $90 million. How much is the Beatles record catalog and associated rights worth today?
A music library, like any other asset, is worth the value of projected future cash flows generated by the asset. If the Beatles catalog generates $70 million a year in profits and is expected to do so for the foreseeable future, then we might value the asset at the present value of $70 million per year for the next twenty years.
However, some assets, such as sports teams, have trophy value. A sports franchise may actually lose money year after year, but increase in value due to the fact that there are a limited number of teams, and they are attractive to wealthy investors for the prestige, fame and the fun of owning them. Also, if a sports team is a top performer in its league or can improve its performance, it can actually make money for its owners.
The late Michael Jackson's share of the Beatles catalog is not only a cash generator, but it is also a trophy asset. I would say it is worth more than its present value of expected cash flows. How much more?
That is a question for the market to answer.
How much is Michael Jackson's own record catalog worth? Priceless.
He was a year older and than I - and I will never forget listening to I Want You Back and ABC when they first aired over AM radio and I started to dance out of sheer joy.
For sure this catalog must be priceless all the more it generates 70 million a year I think it's well enough for his relatives to live a decent life.
Posted by: best credit cards | November 11, 2011 at 05:19 AM
Priceless indeed. RIP Jacko, John, and George.
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I've never hearn about this Jackson's non material assets. He was a big lover of good sound
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