Kanye West’s War Against Record Contracts Could Actually Work — for Kanye, Anyway

Eighteen years ago, Kanye West was proud as punch to have signed to Roc-A-Fella, which he called “the hottest rap label in the world.”

West was a superproducer at this point, but leading figures in hip-hop doubted his abilities as a frontman. “I never really had a good rapper story,” West told Complex in 2002. He claimed he once heard a Capitol Records exec saying that if he “could really rap, Def Jam would’ve signed him or he’d be on the Roc.” By contractually committing to “the Roc,” then, West silenced the haters. He also handed over ownership of his masters for his first six solo albums — including his 2004 debut, The College Dropout.

Last week, amid a Twitter tirade against his historical record-business deals, West posted screen grabs of multiple recording contracts that included a 2005 update to his Roc-A-Fella deal confirming the rapper’s first handful of albums were “entirely [Roc-a-fella’s] property … throughout the world and in perpetuity.” He ranted against Universal Music Group — which acquired Roc-A-Fella in 2004 and released his first six albums — and said he will do “Everything in my legal power and use my voice until all artist contracts are changed starting with getting my masters for my children.”

Now that he’s a billionaire superstar who arguably needs record labels far less than the labels need him, those old contract terms don’t sit well with Kanye anymore.

Those surprised by West’s anti-industry storm must not have been paying attention. West sued Roc-A-Fella last year, as well as Universal and his publishing company, EMI. In the EMI suit, which has since been settled, he appeared as a plaintiff alongside a newly formed company, “Please Gimme My Publishing Inc.” Kanye is now waging the same battle against Universal for his recorded copyrights, a.k.a. his masters.

Kanye’s Twitter ultimatum may not elicit widespread sympathy from the artist community: For one thing, the contracts posted by West revealed Universal paid him an $8 million advance for his sixth studio album, Yeezus (2013), not including an additional $4 million with which to clear samples and make the record. Universal also paid him a $3 million advance, plus a $3 million recording/clearance budget, for The Life of Pablo (2016). Your common or garden-variety megastar just doesn’t get handed this kind of money from their record label.

But there are also reasons for Kanye to be optimistic about at least some of his stated objectives regarding the reclamation of his masters. Here are three of them, connected to a trio of fellow superstars.

1. Leverage (à la Michael Jackson)

One of the more surprising claims within Kanye’s tweetstorm was his suggestion that Universal Music Group had refused to name a sale price for his masters “because they know I can afford to buy them.” Yeezy noted that by the end of this year, there will be around 460 million music streaming subscribers worldwide — which will swell to 2 billion by the end of the decade. And these pieces of information are intrinsically linked.

The “lifetime value” of the globe’s cumulative music-streaming subscribers directly impacts the monetary worth of popular artist catalogs — and therefore directly impacts the value of the companies that own them. It is entirely possible Universal doesn’t want to put a price tag on West’s catalog today for this reason: Get it wrong, and the firm could miss out on masses of money in the years ahead. Adding to the pressure: Vivendi plans to spin out UMG via the music company’s own IPO before 2023. The more superstar catalogs Universal owns, the bigger valuation it will command.

So West needs to consider his own leverage in negotiations. What, other than money, can he bring to bear in his fight to reclaim his masters? One thing Universal definitely wouldn’t want is West walking away publicly from the company — especially toward a rival. This possibility, though, will hurt Universal much more if West is still churning out consistent hits. As we stand, West is on a gospel music-making tip, but his most recent secular album (Ye, 2018) was a commercial underperformer.

Yet West can still conjure up smashes when the mood takes him. The puerile “I Love It” with Lil Pump (2018) was sufficiently odd for one to wonder if it was a knowing parody of hypersexualized modern chart smashes. (“I’m a sick fuck/I like a quick fuck.” Honestly.) But it was a hit nonetheless, reaching Number One in multiple countries and notching over 500 million Spotify plays to date. If West can prove to Universal there’s more where that came from, his record company would surely be more open to discussing a potential timeframe for the return of his past masters.

This was certainly the case with Michael Jackson, whose longtime lawyer John Branca negotiated the artist’s acquisition of his solo masters from Sony Music following the record-breaking release of Thriller in 1982. To this day, Jackson’s classic solo album recordings (Off The Wall, Thriller, Bad, etc.) are all owned by the Jackson Estate’s MJJ Productions — but distributed globally by Sony.

2. The law might be on Kanye’s side (à la Prince)

Kanye’s polemic last week drew comparisons with Prince who, following a famed failure to reclaim ownership of his masters from Warner Bros. Records, took to daubing “SLAVE” on his cheek in the mid-Nineties. What’s often overlooked about the Prince story is why he eventually won this battle in 2014 — when he finally seized ownership of his masters while also licensing them to Warner Bros. for the years ahead.

2014 marked 35 years since the release of Prince’s first classic solo LP, Prince. According to Section 203 of the U.S. Copyright Act — signed into law in 1976 and which became effective in 1978 — recording artists can, under certain circumstances, send notices of termination to record companies in order to take back ownership of their copyrights 35 years after their release. Industry whispers suggest Warner faced a difficult choice: Fight Prince in the courts over Section 203, potentially winning and keeping hold of his masters — but also potentially losing, and setting a dangerous industry precedent — or strike a deal in the here and now. The label chose the latter.

How does this affect Kanye? There are currently two major class-action lawsuits connected to Section 203 bubbling away in the U.S. music industry, one against Universal Music Group (filed by the artist John Waite, among others) and one against Sony Music (filed by New York Dolls member David Johansen, among others). In a pointed warning, the law firm representing the musicians in both cases — Blank Rome — said in a press release that the 35-year law of Section 203 “represents a major challenge to the projected revenue streams for recording companies in the music industry.”

Even under the 35-year law, West wouldn’t be able to apply for termination of his masters deal until 2039 at the earliest (i.e. 35 years after the release of The College Dropout). But if his lawyers go in all-guns-blazing on this point, you’d at least expect Universal’s ears to prick up.

3. The deal Kanye wants artists to have actually already exists (à la Taylor Swift)

Kanye’s new mission isn’t all about Kanye, you know. On Sunday (September 20th), West tweeted: “This is a call for all artist[s] to unify … I will get my masters , I got the most powerful lawyer in music and I can afford them but every artist must be freed and treated fairly.”

In addition, West tweeted new “guidelines” for recording and publishing contract templates he wants to see adopted industrywide. These guidelines include: (1) Artist ownership of copyrights, with these copyrights being “leased” to record companies and publishers for short-term periods; and (2) income being split 80/20 (or more) in the artist’s favor.

Quite apart from the fact that West already appears to own some of his later master copyrights, these two headline “guidelines” actually sound very similar to the major record company deal held by fellow superstar Taylor Swift. Swift announced in late 2018 that she’d signed a new deal with Universal and Republic Records, which would see her “own all of my masters from now on”. Swift’s masters prior to her Lover album are, infamously, owned by Scooter Braun. Despite a history of public enmity with Swift that harkens back to their infamous VMAs moment a decade ago, West is now promising to help Swift get the rest of her masters back.

One other suggestion within Kanye’s “guidelines” deserves serious industry contemplation — which is the idea that artists whose record companies own stakes in Spotify should see their individual share of that money reflected in their royalty statements.

Artists signed to Universal are currently awaiting the day when UMG sells its stake in Spotify, a stake West’s sources suggest is now worth more than $2 billion. How do those artists know they’re guaranteed a slice of Universal’s money hitting their bank accounts once it drops down the chute?

Because Taylor Swift saw to it.

Tim Ingham is the founder and publisher of Music Business Worldwide, which has serviced the global industry with news, analysis, and jobs since 2015. He writes a weekly column for Rolling Stone.