Migos “First 48” Publishing Royalties

Description

Up for auction are mechanical, sync and performance royalties from the Grammy-nominated hip-hop group Migos, featuring individually awarded artists and cousins – Offset, Quavo and Takeoff.

This single-song collection earns from the 2014 Migos release “First 48” which appeared on the mixtape No Label 2. “First 48” has shown impressive staying-power, continuing to earn consistently over the 5 years following its release.

Over half of historic earnings for “First 48” derive from mechanical royalties, which prove to be the most consistent source to date. As the US Copyright Royalty Board recently raised the rates digital music services must pay for mechanical royalties, the winning investor will benefit as mechanical royalties continue to earn on the track.

What’s interesting is “First 48” received a large sync payment in Q1 2018 for its 2017 placement in the popular video game series Grand Theft Auto V. Synchronization royalties are less dependent on popular trends or radio airplay, as the music is not purchased for fans to enjoy and stream, but to create a mood. Though it is unlikely this payment will occur again, you will benefit from any up-front sync fees for future placements.

Key Drivers

Dollar Age. This catalog has a Dollar Age of approximately 5.62 years. A high Dollar Age like this suggests stability and longevity. “First 48” was released in 2014 and royalties continue to remain consistent over five years after its release. A catalog containing mature works with consistent is something worth noting as an investor. This can help sustain a catalog's earnings moving forward.

Income Mix. The winner of this auction can receive income from various royalty streams:

• Mechanical: Royalties paid to songwriters and artists when music is sold (downloaded) but also when music is streamed (streaming mechanicals) “on-demand” like Spotify for example. Click here to learn more about mechanical royalties.

• Performance: Royalties paid to songwriters when music is performed publicly. Music played over the radio, in a restaurant or bar, or over a service like Spotify or Pandora is considered a public performance.

• Synchronization: Royalties paid to songwriters and publishers for the licensing of a song in music for a movie, TV show, or commercial.

This catalog’s recent income mix is relatively evenly split across performance and mechanical sources. Making up 39% of revenue in the last 12 months, mechanical royalties also contribute to two of the largest earning periods, making mechanicals this collection's strongest source to date. Performance royalties make up an additional 31% of recent earnings. It’s worth noting this collection earned a large sync payment in Q1 2018 contributing to over 73% of revenue collected in the quarter.

Mechanical Rate Increase. The US Copyright Royalty Board recently raised the rates digital music services must pay for mechanical royalties by nearly 44% over the next 5 years. Historically, this catalog has earned 53% of its royalties from mechanical royalties. As the winner of this auction, you will benefit from the mechanical rate increases as you collect mechanical royalties. Click here to learn more about mechanical royalties.