The music industry has long been unable to find a common language both with modern technologies and with traditional models of transmission of audio information. Even before Napster's file sharing platform appeared in 1999, musicians faced the problem of unfair distribution of income between the owners of large labels and direct content producers and its distributors. Over the past 20 years, relations between contractors and artists have only worsened as revenue from sales of albums and live performances fell, and it was often impossible to get anything tangible from internet resources.
The situation on the music market can be illustrated by an incident that occurred at the beginning of 2010. Singer Sergey Lazarev said that he is suing the social network VKontakte for the fact that his album was then available to users for free. "I really hope that in Russia there will be a habit of buying music, and not stealing it. The release of iTunes in Russia is an important step in this direction," said the artist. Pavel Durov, who headed VK back then, responded to this statement by removing all the tracks of the artist from the social network and making a post in Twitter "We removed the tracks of Sergey Lazarev from VK. The cultural value of audio records in VKontakte has grown dramatically."
With the advent of blockchain, musicians got an opportunity to get a platform for placing the products of their creativity. By means of such a platform, it would be possible to receive payments in cryptocurrencies directly from listeners, thus bypassing any intermediaries. Here are just some of the platforms that can already solve the problem of unfair distribution of income in the music industry:
Ujo is a startup created on the basis of the Ethereum blockchain. It was created not only for musicians but also for all representatives of creative professions. With the help of Ujo, musicians can register their works, and then give their fans an opportunity to download and receive files. And those, in turn, must acquire a license to use the downloaded content. According to the founder of the site, Phil Barry, soon everyone will understand that blockchain will change not only the musical but also other creative industries.
Soundchain is a service that offers people themselves to finance an artist by engaging in Ethereum smart contracts. "Independent Distributed Labels" are registered with the help of this site, and the rights to their works are issued in the form of tokens. All dividends from their sale are distributed between the artists and their fans, who took part in the release and promotion of new albums in proportion to the number of assets they have.
Bittunes launched an Android application in 2015, which helps independent singers holding rights to share revenue with their fans using Bitcoin. Any user can buy a part of the rights to their records, having received profit from the sales of an album. Thus, musicians simultaneously encourage their fans and ensure their creations generate a flow of investment. In addition, the launch of Bittunes 2.0 is scheduled for 2018.
"We cannot do anything with money, but we can do everything with monetization. Something terrible has happened to music, and it needs to be fixed. And it seems to us that a solution has been found," said the creator of the project, Simon Edhaus.
Stem is a platform that positions itself as a project that helps receive adequate and fair income for the creative class. Through it, artists upload their music to YouTube, Spotify, Apple Music, and Soundcloud. Then the musician can track the use of their works and distribute the earnings by relying on smart contracts.
Blockchain vs. Labels
Obviously, the process of transformation of the music industry will not take place overnight, but new services based on blockchain technology can become a real alternative to traditional methods of doing business for all players of this market, in which the lion's share of proceeds goes to investors, labels, and distributors. This is proven by a significant increase in the number of musicians interested in signing contracts with startups, not with labels, and the growing number of grateful listeners who are ready to support their favorite musicians financially.
On the other hand, not all musicians agree with the need to immediately get rid of expensive intermediaries, because they perform important functions, which are often beyond the power of an ordinary musician. "The question is how much musicians are self-sufficient without music labels and are ready for the solutions offered by the mediators for creative people. It is not enough to create a musical product, it must be properly presented to the public. And how does one do it without knowledge of marketing? Is the musician able to independently organize his own concert, control the sales of music, keep accounts and deal with taxation? Therefore, the task of earning a profit by a musician without the participation of intermediaries is far from a priority. First you need to get your listener ready to pay the artist for creativity in principle," told the vocalist and author of the folk punk group "Kukish" and dark synths project "OBSH-PIT" Stas Kukushkin to DeCenter.