In November of 2021 Taylor Swift released Red (Taylor’s Version), a rerecorded version of her hit 2012 studio album. Red is the second of six albums that Swift plans to rerecord due to a dispute with her former record label, Big Machine, over ownership of the master recordings of those works. The bad blood between Swift and Big Machine came to light after the contract she signed with the label at age fifteen expired and she signed a new deal with Universal Music Group’s (UMG) Republic Records. Shortly thereafter, news broke that Big Machine’s then-CEO Scott Borchetta had sold the label for $300 million, and with it the entire catalog of Swift’s work, which was valued at approximately $140 million.
Swift was devastated by the news, explaining in an emotional social media post that she had spent years attempting to negotiate the purchase of her life’s work, but that ultimately her music was sold to her longtime adversary, Scooter Braun, without her knowledge and against her will. However, because the prohibition on rerecording in the Big Machine contract has now expired, Swift has begun recording nearly identical copies of her old work in order to regain control over its use, and presumably to devalue the originals. In doing so, she is demonstrating that the old rules about where power in the music industry lies are shifting, and making a powerful moral argument about why artists should be allowed to own their work.
What is a Master Recording?
There are two main types of music copyrights: composition rights and master rights. Composition rights relate to the underlying musical arrangement of a song, including elements such as the lyrics and melody. Master recordings, or “masters,” on the other hand, are the final, official sound recording of a song from which later copies are made. The license holder of the master rights has the authority to make decisions about which films and TV projects a song is used in, whether it can be performed at concerts, and how it gets released—whether through streaming platforms or other mediums. It follows that if a record company refuses to license a song for such uses, the artist loses out on the profits that would result. (This is what enabled Borchetta and Braun to threaten to prevent Swift from performing her old hits at the 2019 American Music Awards, and from using her music in her Netflix documentary, Miss Americana.)
The Shifting Balance of Power
Historically, contracts between record labels and artists have provided that the label will own the master recordings of the works that its artists create. Indeed, this was the case with Swift’s Big Machine contract. Fortunately for Swift, though, while she did not retain the rights to the master recordings of her first six albums, she wrote or co-wrote all of the songs on them, and as a result retained the composition rights to those works. This is why she is now able to rerecord those albums and brand them as “Taylor’s Version.”
In some respects, an arrangement wherein a record label retains ownership of master recordings seems reasonable. After all, labels often take a financial risk by signing an unknown artist, investing considerable time and resources into developing her talent and promoting her work, and should be compensated accordingly. However, there are many troubling high-profile examples of young or legally unsavvy artists becoming locked into contracts that end up damaging their careers and undermining their ability to make a living despite their having produced commercially successful albums. Additionally, reporting shows that in a typical record deal—one in which the record label owns the masters—the label takes in approximately 80% of streaming revenue, while an artist receives just 20%. When artists own their masters, however, they keep 80% to 95% of that revenue. While 20% of streaming revenues may amount to a large sum for a superstar like Swift, many artists with smaller followings would be unable to make ends meet under similar contract terms.
Fortunately, several trends indicate that the power imbalance between artists and record labels is starting to change. First, the growth of social media in the past two decades has made artists less dependent on record labels to promote their work. Many of today’s most successful artists, from Shawn Mendes to Justin Bieber, were discovered on YouTube or other video sharing platforms. These sites allow artists to interact directly with fans and grow large followings. As a result, record companies increasingly end up in bidding wars over young artists who have gained internet fame, which gives these musicians more leverage and thus a greater likelihood of negotiating ownership of their masters.
Swift’s high-profile rerecording endeavor is raising awareness among today’s up-and-coming artists about the importance of owning their own masters and inspiring them to take control of their work by demanding favorable contract terms.
Additionally, many artists today earn income from sources other than the music recordings themselves, such as by collaborating with brands to promote products on social media. The availability of these alternative revenue sources makes the process of signing with a label less treacherous by allowing artists to be more selective about the contract terms they accept.
Finally, Swift’s high-profile rerecording endeavor is raising awareness among today’s up-and-coming artists about the importance of owning their own masters and inspiring them to take control of their work by demanding favorable contract terms. While it’s too early to say that everything has changed, there is evidence that the music industry is feeling the pressure to respond to those demands: reporting shows that UMG has begun to increase royalty payments to artists—though it has simultaneously doubled the rerecording time minimums in its contracts. This indicates that the label, whose contracts often become the industry standard, is attempting to strike a delicate balance between responding to artists’ demands for fair compensation and protecting its own investments far into the future. Long story short, while the tension between artists and labels is unlikely to subside any time soon, Swift’s advocacy around artists’ rights is undoubtedly contributing to the shifting power dynamics within the industry and empowering artists to negotiate for contracts that will allow them to make a living doing what they love for years to come.
Emily grew up in Long Beach, California and studied Urban & Environmental Policy at Occidental College. After graduation she spent several years working as a Legislative Assistant to a member of the House of Representatives in Washington, D.C. She later joined the Government Relations team at The Wilderness Society where she advocated for policies to protect national forests and other public lands. In her spare time Emily loves running, baking, and discovering new ice cream shops.