Bob Dylan cashing in on his music catalog for an estimated $300 million is just the latest example of boomers hoarding wealth

Bob Dylan just sold his entire song catalog to Universal Music Publishing. To quote one of his most famous lyrics, the times they are-a-changin'.

• Bob Dylan just sold his entire song catalog for an estimated $300 million.
• It's a "very, very rare" deal, according to Berklee College of Music professor George Howard.
• But artists are increasingly selling the rights to their songs, and it's because streaming services have shown those songs will bring in steady revenue. Besides Dylan, Stevie Nicks is another notable recent example.
• Streaming services themselves may advantage larger artists and this dynamic, in which already wealthy older musicians can reap massive benefits from a system in which it's hard for millennials to even get a foothold, mirrors that of the wider economy.
• Dylan's big pay day is a microcosm of the generational wealth gap, in which boomers have lucked out and millennials get screwed.
• Visit Business Insider's homepage for more stories.

The voice of the baby boomer generation just cashed in big. 

Bob Dylan just sold his entire song catalog to Universal Music Publishing Group in a deal estimated by The New York Times to be worth over $300 million. The only other catalog deal in the same league is that of the Beatles, The Wall Street Journal reported.

The catalog spans six decades of Dylan's work and over 600 songs, although it's unclear if the deal encompasses any future work from Dylan.

Universal Music Group declined to comment further on terms of the deal to Business Insider.

The deal is potentially historic, as it may be the largest-ever acquisition of an artist's publishing rights. And it's an intriguing move from the notoriously elusive Dylan, who waited months to accept his 2016 Nobel Prize in a private, media-free ceremony.

It's also a byproduct of the streaming revolution, which has coincided with a rise in value for the rights to artists' music. That means that older, more established artists (and, arguably, cultural icons) like Dylan are able to cash in, further enhancing their already secured generational wealth. Meanwhile, younger artists who have yet to build such a legacy may find themselves on the other side of the streaming equation.

Ultimately, the transaction is a microcosm of generational wealth inequality. Millennials hold four times less US wealth than boomers held at their age, per Fed data, and earn 20% less than boomers did, a report by think tank New America found. Meanwhile, boomers have reaped financial gains through luck and external forces, a new Deutsche Bank report found, benefiting from an increased value in assets thanks to low-interest rates and from inflated housing prices.

(Despite being widely considered the voice of the boomer generation, the 79-year-old Dylan is technically a member of the Silent Generation. Representatives for Bob Dylan did not respond to Business Insider's requests for comment)

Dylan and his peers have benefited from streaming

Dylan's specific deal is "very, very rare," George Howard, an associate professor of music business/management at Berklee College of Music and a 30-year veteran of the industry, told Business Insider.

"In this case, it appears that the Bob sold the whole kit and caboodle, which means that, when his songs are generating money - be it covered by other artists like Adele, or when they're played on the radio or on TV - rather than him keeping some of that revenue, it's all gonna go to Universal," Howard said.

But Howard said that deals like Dylan's or Stevie Nicks' are consistent with one newer aspect of the music industry: quantifiable and predictable revenue from digital streaming platforms (DSPs), such as Spotify. The DSPs have given investors and big publishers much more certainty about how much future revenue an artist can bring in, he said.

He cited "Bowie Bonds," which were created by David Bowie and David Pullman in 1997. A security backed by the late singer's royalty streams and future sales, Bowie Bonds were rated by Fitch, Moody's, and Standard & Poor's, and were worth $55 million at the time of issuance.

Bowie used some of that $55 million to buy out his former manager's share of his masters from RCA, according to Billboard.

Spotify crippled the emergence of new, younger artists

Spotify's sweet and sour effects on artists have long been debated, from benefits such as displacing contact discs as the leading source of sector revenue to claims that they undersell creators.

Consider Taylor Swift, who pulled her songs from Spotify in 2014, writing in a Wall Street Journal op-ed that music shouldn't be free and Spotify could be hurting music sales. "Everybody's complaining about how music sales are shrinking, but nobody's changing the way they're doing things," she told Time of her decision. "They keep running towards streaming, which is, for the most part, what has been shrinking the numbers of paid album sales."

Swift decided to return her catalog to Spotify in 2017, but she isn't the only artist who felt nickel-and-dimed. Adele has expressed skepticism about streaming, and didn't put her 2015 LP, "25," on Spotify until June 2016. Tool held off until 2019. 

Both Spotify and Apple Music use a "pro rata" model to pay artists. Every month Spotify creates a pool of the money it can distribute, and then divides it up based on the popularity of tracks. If one song - such as a massive hit by an A-lister - was 1% of all streams on Spotify that month, that artist would receive 1% of Spotify's pot. 

That may advantage more popular and established artists, like Dylan.

A representative from Spotify directed Business Insider to a study detailing the pro rata versus user-centric models.

Even in music, boomers win big and millennials get screwed

To be sure, streaming services have transformed some young artists into stars. Teen idol Kim Petras independently released her debut single "I Don't Want It at All" in 2017, which topped Spotify's Global Viral 50 chart. She's yet to sign to a major label, reported Slate's Brandon Tensley, collaborating with Spotify to release sequential singles. 

But Petras told music services company AWAL for their blog last year that sometimes, it would be easier to have label support for publicity and tours - although she still values the independence working with Spotify has given her. Tensley noted, though, that the credit she gives Spotify isn't commonplace among artists.

And it's not just young artists who feel slighted by streaming services. Björk kept her 2015 album "Vulnicura" off Spotify and Neil Young pulled his albums off the streaming service the same year - although neither cited economic reasons behind their decisions, instead claiming issues of respect and audio quality, respectively. (Björk, a Gen X icon, was actually born near the tail end of the boomer generation, while Young, who comes close to rivalling Dylan as a boomer figure of import, is also of the Silent Generation.)

"I'm no fan of Spotify, but what they did do was represent a predictable stream of revenue," Howard said. That means that Dylan's hefty catalog has a "pretty predictable" publishing payout from streaming services.

"That's happening across the board, where artists and rights holders are securitizing their future earnings in lots of different ways," Howard said. "This is remarkable because it's Bob Dylan, and you're talking about, as I say, pretty inarguably, the greatest collection of American songs ever recorded."

Ultimately, artists like Dylan, who have had time to build their musical library, are the ones reaping the rewards, while younger artists are left competing with each other on platforms that are underselling them. It's no different than the overarching tale of the millennial being screwed out of building wealth the way that boomers have been able to.

As for how long this generational wealth gap will remain, the answer is blowin' in the wind.