The ongoing saga of Shawn Carter from Brooklyn, NY has taken a turn that has solidified his status as hip-hop's biggest mogul and dealmaker, ever. As the fabled rap artist Jay-Z, he's about to sign an agreement worth a staggering $150 million dollars. Even more startling is the fact that the deal isn't with a record company.
Jay-Z's rise from self proclaimed Brooklyn hustler to rap star to astute businessman is one to blow away Horatio Alger. If you didn't sit up and take notice when he put up $25 million dollars of his own money to invest in a sports arena in his home borough, you will now. The deal he's reportedly about to make is with concert promoter Live Nation. It's structure speaks volumes about the changing landscape of what used to be called the music business.
This deal is not just about putting out music. It involves concerts, merchandising, and financing for an entertainment vehicle of Jay-Z's choice. It's raised a few eyebrows, because his last album was only a modest success. No matter. Live Nation has already locked Madonna and U2 into deals like this. Live Nation plans to make its money on all these artists wherever and whenever it can.
Jay-Z has become a beneficiary of the inability of the music business to make money, well, selling music. CD sales are down a third since 2000. Piracy continues unabated because the business ignored digital compression and file sharing until it was way too late. Falling sales made the music business seek revenue from traditional allies like radio. The two are currently in a nasty spat about whether radio should pay for playing music. So what happens? Artists with earning power through name recognition and concert touring are easily the most desirable.
And it all comes back to Jay-Z, who now describes himself as the Rolling Stones of hip-hop.
If this deal happens, who's to argue?
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