Blockchain Technology Set to Make Recorded Music Profitable Again
Over the past couple of years, most discussions around blockchain technology are related to Bitcoin – the most dominant digital currency in the world. Digital currencies are the most common use of blockchain technology, as the majority of digital currencies on the market are built on this technology. Nevertheless, cryptocurrency is not the only use for blockchain. This technology has a wide range of use cases and it comes in handy in many industries.
The latest issue that blockchain buffs want to resolve is making sure that artists are compensated for their songs fairly. Choon – a new streaming platform co-founded by DJ Gareth Emery – wants to utilize the record-keeping advantages and transparency of blockchain technology to get intermediaries out of the equation and provide artists with revenue directly. Emery recently said:
“Our ways of doing accounting and royalties was basically designed in the days of sheet music and jukeboxes and has been transferred to new innovations, and we now have a system that no longer fits purpose. Instead of trying to build on top of a fundamentally flawed system, we are trying to build a new one that does not have anything to do with the old one.”
This is a great ambition, but does Choon has what it take to come out strong in a world dominated by platforms such as Spotify and Apple?
The Issue with the Music Industry
According to Emery, the issue with the music industry right now is that there are too many intermediaries, with every one of them asking for their share of the profits, leaving the musician that actually made the song with almost nothing. These intermediaries range from publishers, record labels, and copyright societies down to streaming platforms that package up the song of an artist and deliver it to their fans.
Emery said, “We have also been kind of fed the myth that there is no money in recorded music.” There is actually money in recorded music – the industry is worth over $16 billion – but the money just goes to the wrong persons. The argument of Emery is not just that these intermediaries are taking too much of the money meant for artists, but that their existence in the recorded music industry is undemocratic.
Emery even shared stories of how managers encourage musicians to wish the curator of playlists on Spotify a happy birthday on Twitter or even send them presents to secure them a spot on a playlist with millions of subscribers. He added that careers could be broken or made by being on those playlists.
He also shared his own experiences of having to chat with the curators of the electronic music playlist and said similar things happen across the different music genres. The fact that only male acts continue to dominate the recorded music industry further makes valid the argument that the trendsetters in the industry are out of touch.
The Solution to the Issue with the Music Industry
Choon is introducing a twofold solution. First, it will do away with all areas of human curations of its homepage. Emery said that there is not going to be any mirrors or smoke about how the homepage of Choon is structured. The company wants to use algorithms to work out what users will see and they will publish it in a transparent way for everyone to know why a release made the list as well as the position it occupies.
This will help to get rid of the favoritism that is created about the playlists curated by humans on Spotify. It is also going to help Choon work with a smaller staff than other top music-streaming platforms.
The solution involves the simplification of the complex process of paying and assigning royalties based on how frequently the song of an artist is streamed – and that is where the benefits of blockchain technology are needed. Emery said that blockchain is not at the fundamental of every part of the Choon ecosystem. Rather, it is a dual-tiered system that consists of a more old-fashioned streaming service framework and an Ethereum-based blockchain to keep a record of streams and make sure artists get paid.
He wants the ecosystem of Choon to be completely transparent. Everyone will have access to the streaming log of every artist. Artists can also get paid daily instead of waiting for a whole year.
Choon Plans to Pay Artists with “Notes”
It is not a surprise that a music-streaming platform built on blockchain technology will decide to pay artists in digital currency. However, what is surprising is that Choon plans to pay artists with its own digital currency called “Notes.” Choon plans to initially distribute the token through initial coin offerings and the notes will become freely tradable after the completion of the ICO.
Nevertheless, freely tradable digital currencies come with their own risks, especially due to the high volatility associated with the crypto market. With volatility aside, there is still no guarantee that Notes will hold any real value. While Choon is making claims of wanting to pay artists more than what other top platforms are paying, if it pays with a digital currency turns out to be worthless, what is the benefit?
Maybe, this reliance on paying royalties with an unproven digital currency means that the company will launch with a library that is almost like that of SoundCloud instead of Spotify, which consists of about 400 independent artists that have their own music libraries instead of those signed with record labels.
Emery seems fine with not catering to the giants in the music industry. He said:
“I'm not interested in Calvin Harris and Ed Sheeran. Who I want is the Calvin Harris and Ed Sheeran who's in his bedroom right now making music“
Unsurprisingly, he is optimistic that his wonderful ambition, which he calls the “mission,” will pay off. He believes in the system just as he believed in Bitcoin when it was just worth around $200. For him, it all comes down to making good music and helping the makers of good music to make good money.