It’s well-known that Bitcoin and blockchain are going to revolutionise the world of banking and finance – but what about the arts? What impact might the blockchain have on creators? Could we see musicians thriving in a new era of the troubled industry?
On the outside, the music industry is booming. Streaming services have allowed music to become far more readily available and easier to discover and enjoy. Revenues are high, labels are prospering, and many more artists are experiencing stratospheric success, allowing them to flex their creative muscles as they will.
Yet on the inside, there is an opposite reality. Piracy and illegal streaming has, and always will be an issue. As is the fact that music is becoming more and more basic and consumable. Charts are now dominated by single artists and albums, Soundcloud is dying, and some even say that the ‘album’ is dying.
The death of SoundCloud would mean more than the end of a service: It could mean the end of a culture https://t.co/A6Fusp69RX
— The New York Times (@nytimes) August 7, 2017
But even with all this, there is another, more significant core issue – that the music industry is overrun by a huge lack of transparency. Spotify, Apple Music and Tidal are all very mysterious with their data. They share little about their payment structures, amounts of streams, who is streaming and where they’re streaming from.
As an up and coming artist, making money from the likes of Spotify and Apple Music is difficult. Using data published by Information Is Beautiful, it was found that for a solo artist to earn the US monthly minimum wage, he/she would need roughly 170,000 plays, an exorbitant amount for someone without a major following.
Not only this, but payments by streaming services and record labels are renowned for taking up to a year to process and go through. Imagine trying make a living on most probably less than the minimum wage, whilst not even receiving that payment for up to a year. It’s impossible. It disempowers creatives.
Radiohead producer Nigel Godrich took to Twitter to condemn Spotify:
The reason is that new artists get paid fuck all with this model.. It’s an equation that just doesn’t work
— nigel godrich (@nigelgod) July 14, 2013
Adding to this, without the data of who is listening and where, it makes it harder for artists to connect to their fans. Targeted advertising works so well because companies have the exact demographics of who will see what, and when. Young artists now might have no idea whether their music is attracting youth or the elderly, Europeans or Americans. Without this information, it makes it harder for them to cater to the desires of their fans, and ultimately harder to generate more income.
How can this change?
There is obviously no concrete answer. Music is a dense industry where luck defines hugely who makes it and who doesn’t. Yet, there can be steps made to change that. Blockchain is now all the rage in the financial world, along with its accompanying cryptocurrencies (Bitcoin, Ethereum etc.). Applying its advantages to the music industry, you can see why it could go a huge way to solving the problems.
The blockchain is effectively a distributed ledger that can validate and register transactions without the need for a central authority. It’s the equivalent of sending a Facebook message to someone, rather than posting a status. One reaches the person directly, the other is hosted on a third-party page.
No one owns this ledger — it’s spread across a network of devices and is publicly available to everyone. Information stored on the ledger is interrelated through cryptographic hashes, which make it completely secure. Transactions are irreversible and tamper-proof.
In short, it means that people can make direct, peer-to-peer exchanges of data, money or anything else of value in any amount, in a safe manner.
BBC News – How blockchain tech could change the way we do business https://t.co/osOFeCwt7P
— 강냉이 (@thelilcorn) October 5, 2017
Projecting this onto streaming services, it would mean that every bit of data, every play, every download, is tracked. No one would own this data; music couldn’t be downloaded illegally, copied or changed because each song or album would contain the metadata of its ownership. With this in place, it would mean that artists would be paid in full for use of their content. Money couldn’t be lost via piracy.
Equally, the transferral of money could be done with much greater ease. At present, the streaming service effectively tallies up an artist’s plays, processes a payment, sends it to the record label (if they have one), who then distribute it at their own leisure. Instead of this, through micropayments, an artist could be paid directly after every play. The cut of this that the label takes could also be paid out immediately – it benefits everyone.
The effectiveness of this procedure would allow the artist to spend more time on the creative process, and have less anxiety over the financial side. Where the current system can cripple young artists, the blockchain system empowers them.
— Farrer Kane (@FarrerKane) September 14, 2017
Is it fool proof?
This is uncertain. There’s far more online about this than I can say with assurance, but it’s clear that blockchain is inhabiting a large bubble at present that may pop at any time. Whether cryptocurrency can effectively replace regular currency is also unknown.
Assuming it doesn’t fail however, the change would be met with hostility by those in higher power. Streaming services are profiting hugely from the lack of transparency. The limitations imposed on artists are beneficial, the data heist produces gold.
Let’s say that blockchain is embraced by start-ups and new artists (which it already is with Gramatik, Shelita Burke, and even Ghostface Killah), it would cause a rift in the industry between these and the giant streaming services. Could you really see Spotify, a company fraught with scandal, utilising a system that might hinder its money-making capabilities? Could you see them giving freedom to their artists when that might trigger them to leave the service?
Again, it’s all very unknown at present; this is a matter for the future. But let’s say that the blockchain is all that it’s cracked up to be, and that no one has any objections to it, it’s feasible that we could be entering into a new era of creative empowerment.
Do you have any opinions on the effect Blockchain could have on the music industry? Let us know in the comment section below.