WHAT'S MERCK
UP TO?

Known as the man who led Sanctuary, Merck Mercuriadis hit headlines recently after announcing plans to float his music royalties fund, Hipgnosis Songs, on the London Stock Exchange. After spending 17 years in the U.S., he’s moving back to Blighty, which is where he delved deeper into his vision for the future of the music business during a conference in London.

Speaking at FastForward Friday, Mercuriadis discussed plans for his two companies, Hipgnosis Music and Hipgnosis Songs. The former is a management venture that exists to develop the careers of new artists, and follows a 30+ year career looking after acts including Elton John, Iron Maiden, Guns N' Roses, Beyonce, Morrissey, Diane Warren, The Dream and Justin Tranter. Four fresh names are waiting in the wings and are expected to be launched via Virgin EMI, Atlantic, Columbia and Warner soon.

Hipgnosis Songs is a £200m fund that’s set up to buy publishing catalogs. Mercuriadis has ambitions to grow it into a £1b firm that has gravitas to negotiate a bigger slice of the pie for songwriters and publishers. Thanks to the growth of streaming, which is bringing the passive consumer into the economic model of music for the first time, Mercuriadis expects the value of the assets he buys to increase dramatically over the next seven years, therefore giving his company some heavy negotiating might.

“Despite delivering what is probably the most important component in music being successful today, the songwriter is getting a share of about 1/13th with the current economic model,” he explained. “The reason that’s happening is because major recorded companies own the major publishing companies. Every time there is room to improve the revenue share, improvements are being shifted to the recorded music side of the business, as opposed to the songwriter. No one is walking into organisations and saying, ‘Until the songwriters are paid properly, they are not delivering songs.’”

Which is precisely what Mercuriadis aims to do. “At its starting point of £200m, Hipgnosis Songs ends up being about 1/22nd of the worldwide publishing business, which gives us the opportunity to instigate some change. But four years down the line, when we’re at £1b, we’re suddenly 18, 19% of the worldwide publishing business, and therefore able to dictate change, and align ourselves with strategic partners to ensure songwriters can get what their fair and just rewards are.”