From BTS to Mariah Carey: eight music industry deals that earned stars millions
BTS members made millions as shareholders of parent company Big Hit Entertainment
If you can't beat them, join them.
The pop music industry is riddled with tales of artists keeping their record labels away from their business.
When it comes to BTS, however, the South Korean boy band remixed that notion by becoming influential shareholders in their record company Big Hit Entertainment. The result is a multimillion dollar windfall for the group after the company floated on the South Korean stock market on October 15 with stocks opening at 270,000 won ($235).
With all seven members of the group given 478,000 shares of company founder Bang Si-hyuk's shares, it made for a lucrative day of trading for the already wealthy heart-throbs.
Si-hyuk's gesture is not down to only warm relations with the band, but a shrewd business decision, too.
According to the IPO filing documents, BTS are the company's primary earners, garnering 87.8 and 97.4 per cent of Big Hit's revenue in the first half of 2020 and 2019 respectively. Giving them a stake in the company, it can be reasoned, will also ensure their loyalty for the foreseeable future.
While the money rolling into the BTS coffers maybe steep, it is in some cases a drop in the ocean compared to what record labels have paid superstars over the years. Here are seven publicised recording contracts that were big hits and misses.
2. Michael Jackson: $250 million (2018)
This is the biggest music deal to date. Months after the pop star died, his estate reached an agreement with Sony that would allow them the rights to his large and hit-laden catalogue, in addition to releasing issues of classic and posthumous albums. The record label wasted no time in exercising the privilege by releasing 2010's Michael, a compilation of unreleased tracks, as well as the 2014 follow up Xscape. Sony also released three greatest hits compilations including 2017's Scream.
3. U2: $200 million (1993)
The eye-watering figure may seem ludicrous if you don't consider how wildly popular U2 were at the time. Hot on the heels of mega-selling albums Rattle and Hum and Achtung Baby, which combined sold 32 million albums, label Polydor made a reasonable bet that the sales will keep on coming. After a dodgy start with the album Zooropa (with seven million albums sold it's considered a misfire by U2's standards), the group held their end of the bargain with hit albums All That You Can't Leave Behind in 2000 and the How to Dismantle an Atomic Bomb four years later.
4. Adele: $130 million (2015)
If this much reported agreement is true, not only is this the biggest contract rewarded to a British music artist, but a potential goldmine for record label Sony. With Adele selling more than 50 million copies of her first three albums, not to mention the already breathless anticipation surrounding her next release, that huge investment will surely pay off.
5. Jay Z: $150 million (2008)
The rapper’s groundbreaking deal not only cemented hip-hop’s ascendancy to the zenith of pop culture, but showed the industry a new way of doing things. Signed with events company Live Nation, the deal gives them a finger in every pie of Jay Z’s career ranging from stakes in album sales and live tours to publishing rights and business investments. Madonna singed a similar deal in 2012 for a cool $120 million.
6. Robbie Williams: $125 million (2002)
Signing deals and creating pop hits are all about timing.
And with this lavish agreement, it looks like EMI may have got the short end of the stick. There is no doubt Williams was superstar at the time of the contract, but he was nowhere near his mercurial period between 2000 and 2002 where he released three albums that sold a combined 25 million copies. While the label may have got a decent return with 2005's Intensive Care and 2006's Rudebox albums reaching 11 million combined sales, it was far removed from William’s heyday.
7. Whitney Houston: 100 million (2001)
A dud of a pact. When news arrived that label Arista shelled out the cash for its biggest deal ever, it helped generate a buzz that Houston was still a force to be reckoned with. But her personal troubles were brewing and the proceeding 10 years saw Houston tragically descend into substance abuse. The contact yielded three forgettable albums and a much maligned world tour before her death in 2012.
8. Mariah Carey: 80 million (2001)
A deal that brought a giant label to its knees. Almost everything went wrong after the contract was signed in the April of 2001. Months later Carey had a much publicised breakdown and was hospitalised. At the same time, her much touted film Glitter flopped in addition to its accompanying soundtrack. To cut their losses, label EMI paid Carey $28 million to extricate itself from the deal. It was reported that the costs of producing and promoting Carey's albums just wasn't worth the investment.
Updated: October 15, 2020 08:00 PM