Madonna inked a deal with Interscope Records that will allow the label run by Jimmy Iovine to release the albums that were originally contracted to Live Nation Entertainment under an ambitious deal that appears to be shrinking in scope.
She plans to release her first album for Interscope next month, first studio album in five years.
A source familiar with the deal's terms said it could be worth between $20 million and $40 million for Madonna and Live Nation combined.
Madonna walked away from a 24-year relationship with Warner Music Group to sign a broad $120 million 10-year deal with Live Nation Entertainment that encompassed touring, ticketing, merchandise, digital assets and three albums.
At the time Live Nation executives had privately predicted its Madonna deal was a sign of a change in the struggling recorded music business that would eventually make traditional music labels irrelevant. It also signed hip-hop artist Jay-Z and rockers Nickelback to similar multi-year so-called '360 degree deals'.
But Live Nation's concert and ticketing business has been hit by the wider economic downturn and sources said the company needs major labels after all to get the marketing and distribution heft required to promote major artists like Madonna and Jay-Z.
Since Live Nation did the deal with Madonna in October 2007 its shares have fallen more than 60 percent. In Feb 2010 it closed its deal to merge with the world's large ticketing company Ticketmaster after a year-long regulatory inquiry.
Madonna is kicking off her Interscope relationship with an album set for release in the last week in January ahead of her upcoming halftime appearance at the Super Bowl on Feb 5. The 53-year old singer also plans to release her new movie 'W.E' on Feb 3.