Universal Music Publishing Group’s purchase of the copyrights to 600 of Bob Dylan’s songs for over $300 million demonstrates the importance of reversion rights to artists. In many countries, a creator who assigns his copyright to a publisher has an opportunity to recapture her rights at some point in the future. These “reversion” or “termination” rights recognize that early in the artist’s career, she has little bargaining strength, and may enter into a one-sided deal favoring the publisher. These reversion rights apply regardless of the contract the artist may have signed with the publisher.
In the United States, these reversion rights kick-in 35 years after assignment for works created after 1977. Starting in 2012, Bob Dylan, along with other creators such as Tom Petty, Kris Kristofferson, and Tom Waits, began exercising their reversion rights in compositions whose copyrights they had assigned to music publishers 35 years earlier. Reversion rights thus played a critical role in Dylan’s re-exerting control over the copyrights he had assigned earlier in his career, thereby enabling him to consummate the lucrative agreement with Universal.
Universal was willing to pay Dylan so much for his copyrights because of the large revenues generated by streaming. In discussing the purchase, Taylor Telford of the Washington Post notes that “music copyrights have become big business, especially as streaming continues to dominate music and new platforms offer scores of licensing opportunities.”
Telford quotes Dan Ives, managing director of equity research at Wedbush Securities, explaining that “streaming has changed the landscape, from a licensing and royalty perspective.” Ives states that “even though there’s eye-popping price tags, if you look at returns in five, 10, or 20 years, these are viewed as very good investments.” (See here for a more detailed discussion of the business opportunities provided by streaming.)
Reversion rights, therefore, are more valuable to artists than ever. This explains why publishers in South Africa have fought so hard against reversion rights in the Copyright Amendment Bill; they want to ensure their ability to exploit artists under the unfair agreements signed when the artists were not in a position to demand better terms. Significantly, the reversion rights in the CAB would apply only prospectively to assignments occurring after adoption of the Act. Moreover, although reversion under the CAB could occur sooner than in the United States (after 25 years rather than 35 years), in some countries reversion can occur fifteen years or less after the original assignment.
The copyright law in South Africa should protect creators no less than U.S. copyright law protects Bob Dylan.
