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How Music On The Blockchain Returns Control to Artists

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Ever since 1877 with the introduction of Thomas Edison’s phonograph, music has had a way of being recorded and converted to a physical form. The medium that Thomas Edison’s phonograph used? A metal cylinder ‘encoded’ with the notes of the song.

Over time, the medium on which music was recorded improved dramatically, and in 1948 the vinyl record was introduced. The vinyl record would allow music to be distributed around the world with great ease. And in turn, the record industry was born.

Money flowed in left, right and centre, and it seemed like nothing could stop the momentum. More and more talent was born out of the growth of it – Elvis Presley rocked the 1950s. The Beatles, The Doors, The Rolling Stones and the Jackson 5 all captivated the 1960s. Music started making its way on to the new and fancy Compact Cassette, created by the Philips company.

Pink Floyd, Queen and ABBA blew minds in the 1970s, and the ’80s saw a new standard for the live scene, with stadium shows unlike any ever seen before. With multiple extravagant stage props, endless pyrotechnics and an army of backing dancers, musicians and other crew members, the budget for these sold-out shows, it seemed, had no limit.

Enter the ’90s era of music distribution and storage

Admittedly the early 1990s got off to a relatively good start. Grunge rock saw an outbreak as did alternative rock. Sales were still going strong at this point, and MTV and VH1 had no plan in sight to stop promoting music videos from all the popular artists.

In the late 90s, a new medium started being widely used. It was called the Compact Disc. Innocent as the CD might have seemed, it was one of the biggest signs that the music industry was transitioning to a digital age. This lighter, smaller and cheaper digital medium meant that the record companies would increase their profit margin.

…But this also meant that individuals that owned a CD drive on their personal computers – that were now gaining more and more mainstream traction as well – could easily use software to extract the digital audio files from the CD and store them locally on their computer’s drive.

The digital era brought more than just the CD to the Record Industry though. In the background, the internet was now being explored by more and more people and companies. The dot com and mainstream internet era were here. And out of it, on June 1st 1999 Napster appeared.

Napster was a peer-to-peer file distribution service. Napster users flocked in and in no time those digital audio files that people had extracted from the CDs had flooded Napster’s search results. Songs from all the artists people had come to love around the world were being offered free of charge for download in mp3 format.

With such value being available for free, it was only logical that Napster got noticed by record companies and artists. Legal battles ensued due to the violation of the intellectual property rights of these pieces of art. Napster lost, and filed for bankruptcy in 2001. However many more similar pieces of software emerged after seeing Napster’s – albeit illegal – success. The Music Industry Piracy Era was upon us.

Music piracy

Record sales started declining dramatically as more and more people opted to click a button and get free music than pay for an album – which in the US, in the 2000s, could retail at an average of $20 per album. To make things worse, sometimes most of the profits didn’t even go to the artists, but to the recording company.

Lower record sales meant less profit for the record companies and their investors. Lower profits meant a smaller budget for things like promotion and touring. Less promoting and touring meant less exposure for artists and bands alike. Less exposure meant less potential income and room for growth for these artists. And this in turn meant less motivation for emerging artists to get their music out in the open.

A negative domino effect had begun from the emergence of the digital era.

Then came a dim light of hope – streaming services. Streaming services shifted the business model of the recording industry, and how artists themselves navigated within it. Record companies needed to spend less money on the actual printing and distribution of their existing albums. They could just utilise these streaming services. And in combination with the lowering cost of home recording equipment, artists were able to make music within their own home studios.

The music industry was shifting from a model where people owned music, to a model where people just wanted access to music. They were willing, once a month, to pay the price a record used to cost in order to have access to millions of songs!

Streaming, however, took its biggest toll on the artists themselves. The digital era brought on the easiest way for them to materialise their music, and at the same time the worst income any artists had potentially seen since the birth of the mainstream record industry. So, musicians have, over the years, been led to seek alternative means of income, because simply selling their music just won’t pay the bills anymore.

From selling merchandise at gigs, to selling meet and greet packages, the possibilities are indeed many. But when your music, the art that is essentially the product of your soul, the reason you live and breathe as a musician, is not the thing that pays the bills and fees you, change must come.

Blockchain and web3 are here

Blockchain tech is already revolutionising many industries – the world of finance was first to feel the blow. DeFi – aka Decentralised Finance – is allowing people to get back in control of their finances. Next was the visual arts world. NFTs are allowing artists to create tokens that are attached to the digital art they have created, thus allowing the buyer to prove ownership of that piece of art. “Right-Click and Save” is now the true pirated versions of these pieces of art.

The gaming industry was affected next. Gamers across the globe showed they want to have actual ownership of their in-game digital assets. And NFTs again provided a means to do so.

Let’s look at some ways that musicians could utilise blockchain tech.

Decentralised Streaming

The problem

Today’s streaming services like Spotify and Apple Music are centralised. If an artist wants to stream their music on one of these platforms it would involve them paying for use of the service in the form of the platform taking a cut of the profit. 

The solution

A decentralised streaming platform would involve artists being able to directly upload their music for listeners to have access to. When someone streams the song, the profit would go directly to the artist themselves, cutting out the middle man.

NFTs

The problem

Piracy. As we discussed above, piracy has hit the music industry hard over the years. Digital downloads are taking away from the profits that musicians truly deserve.

The solution

Contrary to popular belief, an NFT isn’t just a jpeg. An NFT is a token on the blockchain that is distinguishable from any other token on the blockchain. Without getting too technical, an NFT could be made from a particular song that is then available for purchase – just like a digital download.

But the difference between an NFT and just a regular digital download is this. If someone held that NFT in their digital wallet, it would act as proof that they have indeed purchased that song. 

The artist would then be able to offer additional content to holders of their NFT, like exclusive access to previously unreleased songs, or – since the blockchain holds timestamps on record – a limited edition video clip that would only be available to, for example, the first 100 fans that purchased the NFT.

No Censorship

The problem

Centralised platforms are completely in control of whether or not your music will be available from day to day. It is in their power at any point to take down any artist’s music as they will, just because it might not align with their beliefs or vision.

The solution

Having a decentralised network of nodes running and operating the streaming software would mean that no one entity could decide on the fate of the artist’s music. And more availability means more income for the artist.

It’s worth noting that in extreme cases, if for whatever reason the music was deemed unfit for public consumption by the majority of nodes, there are ways for the data to be taken down via voting.

Don’t Stop Me Now!

The problem

Today’s centralised streaming services host their stored data on centralised servers controlled by themselves. If anything were to happen to these servers the music would be lost.

The solution

Distributing the music across many different regions of the globe, and hence many different servers, would allow the music to be available to anyone at any given moment. And blockchains like Arweave – that offer permanent storage – would mean this would always be the case. Upload and pay once and have your songs available forever. And no ongoing hosting costs mean more profit for the artists.

Intellectual Property

The problem

When a band writes a song, sometimes many people are involved. You have each band member that contributed, and then you might also sometimes have an external songwriter or lyricist. Then you also have the audio engineer, the producer and many others too. Managing the royalties each person gets can be difficult, and sometimes you might even have bad actors that try to unjustly take royalties they should not be.

The solution

Via the use of Smart Contracts on the blockchain, you would be able to programatically distribute all the royalties. By including each contributor’s wallet address in the smart contract as well as what percentage of the royalties they should get, each time someone streams the music the correct royalties will be distributed to each contributor automatically.

Secondary Sales

The problem

Today, if someone buys a physical copy of an album and then sells it on eBay or some other secondary marketplace, there is no way of tracking the sale and allowing the artist to get a percentage of the sale. 

This is crucial, as, if one person purchases an album and then sells it to someone else who in turn sells it to another person, and this happens another 7 times, the artist has lost out on 9 sales – as only 1 person paid for the album but 10 people owned and listened to it.

The solution

By distributing the songs as NFTs that are minted (created) via a smart contract that includes code defining the percentage to be taken from a secondary sale of the NFT, the artist would be able to automatically cash in on these secondary market sales.

This is already happening with NFTs on secondary NFT marketplaces like OpenSea.


These are just some of the possibilities. Web3, Blockchain and NFTs can – and most likely will – have a great positive impact on musicians and the music industry as a whole. It is up to the developers to continue building, and the artists to continue adopting.

Some platforms that are way ahead of the game already, and most likely have a great future ahead of them are Releap, Nina and Pianity. They all are focused on bringing the world of music and blockchain together.


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