On this day in 1963 The Beatles formed the music publishing company Northern Songs — with Dick James owning 51% — which is how Michael Jackson eventually came to own their back catalog of songs. Follow the bouncing ball:
Brian Epstein made a number of bad deals for The Beatles. For example, there’s Seltaeb — “Beatles” spelled backwards — a company created to merchandise Beatles’ products. Epstein didn’t have the time, or inclination, to decide on all the merchandise requests that were rolling in, from Beatles wigs to drum sticks to plastic guitars. He decided to outsource this job and signed a contract which gave The Beatles a mere 10% of the royalties. Normally up to 75% would go to the artists on such a deal. It’s estimated that The Beatles lost at least $100,000,000 on that deal, which could have been more lucrative than the worldwide royalties on their music.
However, of all the deals that Brian Epstein got the Beatles involved in, Northern Songs is the one that had the most-lasting effect, biting them in the ass to this very day.
George Harrison was so irritated, he wrote a song about it:
Dick James had been kicking around the music industry since his teens in the ’40s, as a musician and singer. In fact, it’s James’ voice heard on the theme song to the tee vee show The Adventures of Robin Hood. As the WikiWackyWoo explains:
James entered the music publishing
business as his singing career tapered off. In 1958 he joined Sidney
Bron Music as a song-plugger but decided to leave and open Dick James
Music in 1961. In early 1963, he was contacted by Brian Epstein who was looking for a publisher for the second Beatles single, “Please Please Me“. James called Philip Jones, producer of the TV show Thank Your Lucky Stars, played the record down the phone to him and secured the band’s first nationwide television appearance. The pair subsequently established Northern Songs Ltd., with Beatles John Lennon and Paul McCartney, to publish Lennon and McCartney’s original songs. (Fellow Beatles George Harrison and Ringo Starr were also signed to Northern Songs as songwriters, but did not renew their contracts in 1968). James’s company, Dick James Music, administered Northern Songs.
What initially began as an amicable working relationship between the
Beatles and James disintegrated by the late 1960s: the Beatles
considered that James had betrayed and taken advantage of them when he
sold Northern Songs in 1969 without offering the band an opportunity to
buy control of the publishing company. James profited handsomely from
the sale of Northern Songs, but the Beatles never again had the rights
to their own songs.
In later years, The Beatles groused about this deal, but was it really that bad? According to Did the Beatles Get Screwed, at Slate:
Decades later, McCartney would refer to the agreement that created their publishing company, Northern Songs, as a “slave contract.” Harrison would mock its terms in an outtake from Sgt. Pepper’s,
singing “it doesn’t really matter what chords I play… as it’s only a
Northern Song.” Lennon would say with some bitterness that the bald and
bespectacled man who proposed the deal, Dick James, had “carved Brian [Epstein] up.”
In fact, by the standards of the day, Dick James made the Beatles—a
band with one hit record and zero leverage in the industry—a pretty good
Keep in mind that when Chuck Berry recorded his first 45 for Chess Records
in the mid-’50s, the Chess brothers made him share songwriting
credit—right on the label—with a prominent disk jockey, as well as with
the company’s landlord. The publishing rights to Little Richard’s “Tutti Frutti”
were purchased by his label bosses for all of 50 dollars. This kind of
wholesale theft was commonplace; in the early rock era, the ethics of
the average music publisher could make a mob capo blanch.
After Epstein died The Beatles unsuccessfully tried to renegotiate the deal with Dick James, but in 1969 he sold the publishing catalog (which by then included many other songwriters) to Lew Grade‘s ATV without even telling The Beatles. Then they tried to buy back Northern Songs. Unfortunately, it came as The Beatles were in the process of (secretly) breaking up and John Lennon and Paul McCartney couldn’t come to terms. Each had their own advisers by then — Allan Klein for Lennon and Lee Epstein (no relation) for McCartney — and no one could agree on terms. Eventually, the negotiations fell apart and the songs stayed with ATV, with Lennon and McCartney receiving a healthy buy-out for their shares in the company.
After Lennon’s death McCartney again tried to buy the tunes back. According to the Wiki:
In 1981, with Yoko Ono, McCartney attempted to make a joint purchase of the ATV music catalogue. At a 1990 press conference, McCartney stated, “I was offered the songs to buy for 20 million pounds”, but did not want to be perceived as being “grabby” for “owning John Lennon’s bit of the songs”. So he asked Ono if she would make a joint purchase with him, sharing the cost equally.
According to McCartney, Ono thought they could buy it for half the
price being offered and he agreed to see what could be done about that. McCartney then let the deal fall through when they were not able to make a joint acquisition.
A few years later, McCartney recorded with Michael Jackson. As always, the Wiki knows all:
During their collaboration on the song, “Say, Say, Say“, McCartney informed Jackson about the financial value of music publishing. According to McCartney, this was his response to Jackson asking him for business advice. McCartney showed Jackson a thick booklet displaying all the song and publishing rights he owned, from which he was then reportedly earning £24.4 million from songs by other artists. Jackson became quite interested and enquired about the process of acquiring songs and how the songs were used.
According to McCartney, Jackson said, “I’m going to get yours [Beatles’
songs]”, which McCartney thought was a joke, replying, “Ho ho, you,
And, that’s how the songs ended up at Sony Music.
McCartney and Yoko Ono were given first right of refusal, but both passed when they couldn’t strike a deal. Michael Jackson stepped in and bought the catalog, including Northern Songs. Once he owned the songs, he started licensing them out for
tee vee commercials, something The Beatles had always resisted. This outraged
Beatles’ fans around the world.
When Jackson started to experience some cash flow problems, he eventually sold the rights to half of his publishing company to Sony, where they have stayed ever since.