BOBBI KRISTINA MAY HAVE TO GET A JOB IF WHAT SOURCES SAY IS TRUE.
Right before Whitney’s death numerous reports surfaced that the troubled singer was broke. Houston’s reps refuted the claims stating that she was no where near broke at all after earning $26 million on tour. But a new report that surfaced after Whitney’s death pins the late singer as “dead broke”. Whitney Houston’s entire estate is cash strapped.
One label executive “familiar with Sony’s accounting,” said the late singer’s estate probably won’t see any royalty checks from her record label “in our lifetime” — and maybe longer — thanks in part to the number of advances and loans she took from the $100 million deal she cut with Sony Music in 2001.
On Wednesday, Wayne Rosso, an outspoken veteran of the music business who has consulted for CBS, Island, MCA, Arista and RCA Records, to name just a few labels, posted a report in his Wayne’s World blog titled, “Whitney to Sony: I Will Always Owe You.”
In it, Rosso estimated that Houston would have to posthumously sell more than 5 million albums “to repay her advances and start to get royalty checks.”
While that might not seem like a lot, Whitney’s greatest hits album would need to stay number one for six months in order to release that.
While Whitney Houston did sign a $100 million dollar deal, it’s believed Sony never wrote out a check for $100 million.
How in God’s name could she, or anyone, have blown through that much dough?
The answer is simple, according to one source who was close to Whitney. “It takes a lot of money to maintain that lifestyle”.
Then again, Sony never wrote out a check for $100 million either.
According to a very highly placed industry source who is very familiar with the Whitney situation, the deal most likely looks like every major superstar recording contract like these days. The deal would look something like this: 4 studio albums and 2 compilation album (Greatest Hits, Number One’s, something like that) with a $25 million advance for the first album (Just Whitney) and a $10 million advance for the second album (I Look To You). Tacked on to that advance would be the costs of the music videos at approximately $500,000 each (there was a total of 6 music videos produced under the new deal which would total approximately $3 million in costs). That would bring the total amount of money that Whitney Houston would owe Sony to approximately $38 million. Maybe more. Her royalty rate was most likely $4 per album, and the new deal would have reset all future royalty payments on past catalog. Any deficits in her royalty account up to that point were more than likely wiped out, according to the source, basically giving Houston a fresh start. This means that Whitney would have to sell at least 9.5 million albums to repay here advances and start to get royalty checks.
Now we have to look at what she has sold. The first album under the new deal, 2002′s Just Whitney, has sold 763,188 in the US. The second album, I Look To You from 2009, sold 992,904. That’s a total of 1,756, 092. Let’s round it off at 1.76 million. Now let’s double it to account for foreign sales. That brings the total to approximately 3.51 million. Now let’s add in her Christmas album from 2003, One Wish: The Holiday Album, which sold 490,00 units. That brings here total sales to around 4 million units under her last deal.
Now, according to Billboard Magazine, ”The late Whitney Houston has two of the three biggest jumps on the Billboard 200 this week. Her “The Preacher’s Wife” soundtrack runs 183-90 (up 93 slots) and “I Look To You” flies 118-65 (up 53 positions). “The Preacher’s Wife” sold 7,000 (up 46%), while “I Look To You” did 9,000 (up 81%). Houston, who died on Feb. 11, sold a collected 247,000 albums last week (ending Feb. 19) — the first full sales week after her death. Her biggest seller was “Whitney: the Greatest Hits,” with 175,000 (up 174%). Overall, Houston’s albums earned a 144% sales increase in the week ending Feb. 19, compared to the 101,000 sold in the week ending Feb. 12.” Clearly that sales pace will slow considerably. But let’s add the sales of the last 2 weeks, even though the Soundscan figures quoted above for Just Whitney and I look To You have already been factored in. That would come to 348,000. That brings her total album sales under the 2001 $100 million deal to approximately 4.35 million units.
Let’s now subtract the 4.35 million albums she’s sold since 2001 from the 9.5 million albums she would have to sell for Sony to recoup its investment, and that leaves us with over 5 million. Let’s assume that going forward Whitney: the Greatest Hits will be the biggest seller as it has been since her death. It sold 175,000 units at the peak of the Whitney buying surge. If that could continue, which it certainly won’t, Whitney would most likely occupy the Number One position on the Billboard album charts every week for the next six months! As one label executive familiar with Sony’s accounting said, “That ain’t going to happen. The reality is that her estate probably won’t see a royalty check from Sony in our lifetime…at least”.
On top of the millions of advances, one of my insiders says that throughout her career Whitney consistently took out loans from the label with Clive Davis’ assistance. The last big loan was reportedly from Clive for $1.2 million, though everyone knows it came from Sony and not from Clive. “No way Clive would ever reach into his own pocket for anyone’” said one former label employee.
That sucks. Whitney really was broke. But I’m sure there was a life insurance policy somewhere for Bobbi Kristina.