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Hipgnosis announces new partnerships with SACEM and Peermusic

By | Published on Thursday 14 July 2022

Hipgnosis Songs Fund

The Hipgnosis Songs Fund has announced two new deals to help it better manage and exploit the catalogues of song rights it has acquired in recent years, with a new administration partnership with French collecting society SACEM and a sub-publishing arrangement with Peermusic.

SACEM will manage and process digital royalties generated by the Hipgnosis catalogues in a number of markets, principally the UK and European Union.

With song rights, all the entities that are licensing streaming services – whether they are music publishers or collecting societies – have to process a stack of usage data every month in order to calculate and claim what royalties they are due.

SACEM already handles that process for the Anglo-American catalogues of a number of publishers – including Universal Music Publishing and the indie publisher licensing alliance IMPEL – as well as the French repertoire it directly controls.

Outlining the services the French society will now provide Hipgnosis, SACEM CEO Cécile Rap-Veber says: “Hipgnosis will benefit from SACEM’s negotiation with multi-territorial [streaming services], and technological expertise, especially in the field of data management with its innovative URights platform, which will give Hipgnosis full visibility, in real time, on the revenues generated by its catalogues”.

“Our goal is always to add value to music by leveraging the transformations in consumption and distribution modes, in order to contribute to the vitality of creation and cultural diversity”, she adds. “We are THRILLED to partner with Hipgnosis. This partnership once again demonstrates SACEM’s ability to serve innovative players in the music market and increase the remuneration of works of major artists and to contribute to the preservation of these catalogues”.

Peermusic will act as a sub-publisher for Hipgnosis in the rest of the world, excluding the US, handling royalty administration and seeking sync opportunities. In the US, Hipgnosis has its own on-the-ground operation for such things – known as the Hipgnosis Songs Group – which evolved out of Big Deal Music, the publishing business it acquired back in 2020.

And, in fact, the Peermusic partnership was originally with Big Deal, as Peermusic CEO Mary Megan Peer explains. “We initially started this relationship through Big Deal Music”, she says, “and have built a genuine connection from there”.

“As the sub-publisher for Hipgnosis Songs Fund, Peermusic will work to maximise sync opportunities for Hipgnosis clients in all local markets, as well as provide them with the first-class administration for which Peermusic is known”, she goes on.

Commenting on the new deals – and how they will reduce some of the complexities involved in processing royalties due to the Hipgnosis catalogues – the company’s founder and CEO Merck Mercuriadis says that the combination of SACEM, Peermusic and the Hipgnosis Songs Group “provides us with global coverage from best in class operators with a focus on collecting more, collecting it faster and getting it paid through faster”.

Also name-checking Peermusic Executive Chair Ralph Peer II, he adds: “We’ve had a long-standing admiration for both Ralph and Mary Megan Peer, who are the first family of music publishing, and SACEM has been elevated to a gold standard under Cecile Rap-Veber’s leadership. We very much look forward to welcoming them to the Hipgnosis family and working closely together”.

The new partnerships will initially apply to 36 of the catalogues Hipgnosis controls, including music from Neil Young, Red Hot Chili Peppers, Chrissie Hynde and Jack Antonoff. They will then extend to other Hipgnosis catalogues in due course.

Alongside announcing the new partnerships, Hipgnosis has also published year-end results for the last financial year. Selecting some key stats from those results, Mercuriadis brags thus: “Over the last four years we have acquired an incomparable portfolio of some of the most successful and culturally important songs of all time, now valued at $2.7 billion”.

“The unique strength of our catalogue”, he goes on, “is demonstrated by the 9.9% increase in the operative net asset value to $1.8491 per share, as reported by our independent portfolio valuer, and a total net asset value return of 14.2%. This is largely driven by our iconic songs outstripping the general market growth in streaming, particularly in the second half of 2021, providing validation for our investment strategy”.

Looking ahead, Mercuriadis notes the recent upbeat predictions for further growth in the digital music market from Goldman Sachs, and the recent US Copyright Royalty Board decision regarding song royalty rates, concluding: “I believe we are looking forward to very attractive market conditions. Given our incomparable collection of iconic songs, I believe Hipgnosis is perfectly placed and will continue to deliver excellent returns for our shareholders”.