Blockchain Technology Revolution in the Music Industry
Just a few hours ago I thought Bitcoin and Cryptocurrency in general was probably like Monopoly Money and was most likely some kind of scam, I wasn’t really paying attention.
My friend Shawn Gordon invited me to investigate further. What excited me the most was the technology behind it all, Blockchain technology.
My head soon was spinning with all of the applications it could have in SO MANY industries, especially the music industry. The lynchpin in Blockchain Technology is the unique hash value in each block, just as no two fingerprints are alike.
Digital piracy has all but destroyed the music industry, devaluing the product. The very nature of digital that it can be replicated an infinite number of times over from one source without losing quality — has been a boon to home recording, but it has been disaster to sales of the final product, to real recording studios and to audiophiles.
Thanks to the internet, web users globally have a tresure-trove of free content, from any artist they can possibly think of, no matter how obscure. Why purchase anything when there are sites online that will glean content off YouTube and other websites and give you at least a 192 kbps mp3, which is suitable for airplay on most online radio stations.
How can labels or artists protect their songs? Many copyright holders have lost control over their intellectual property and are suffering financially as a consequence. Blockchain Technology with the signature hash value at it’s root can create “smart contracts”- which could protect copyrights and stop the risk of file copying and redistribution. Blockchain Technology would create a peer-to-peer music distribution system, each work would have its own hash value so duplicates could not exist. Much like how Google Docs works, instead of a centralized distribution center, each computer (node) would have access the the work. This enables musicians to sell songs directly or to have labels do so — all of these aspects could be automated by smart contracts.
The capacity of blockchains to issue payments in fractional cryptocurrency amounts (micropayments) should be appealing to streaming companies who are paying essentially micropayments to artists now anyway.
The real power however, lies in tracking. The system for tracking royalties and airplay of music has been a random hodgepodge since radio began. Pay for Play, Payola and Paper Adds (A radio station saying they played the record, but really didn’t) was an old trick stations used to preserve ratings by not playing the terrible record, but still getting spiffed by the label — usually in the form of money, lavish gifts or even new cars) corrupted the radio industry from the beginning. The labels won out by having said terrible artist at the top of the charts, (but never received the actual airplay to back it up).
After 30 plus years in radio the tracking was never very precise.
Once a year BMI would come in to the radio station and ask for the survey week which every Program Director dreaded. We had to send a weeks worth of airplay to them during the week they asked for. Most Program Directors filled it out inaccurately or passed it off to the music director to do, who in turn passed it off to the overnight jock to do. I always asked the BMI guys so what if you are an artist that got played every day of the year EXCEPT during the survey week. It was met with a blank stare… well it wouldn’t count that they had any airplay — but that probably wouldn’t happen they would say, they have formulas to extrapolate airplay based on percentages… it sounded like mumbo jumbo to me. Don’t even bring up ASCAP, in all of my radio years as a Program and Music Director, they never asked me what I’ve played.
While Internet radio has improved tracking, still many online stations do not pay royalties or report to BMI or ASCAP. Blockchain Technology could fix this! With the one copy out there, that everyone can share it would be tracked each time it was played and where, even at home. We learned early on in radio with Arbitron that what people SAY they listen to and what they actually listen to (guilty pleasures) are vastly different. Everyone wants to be perceived as cool, but in reality what they really listened to wasn’t quite as cool…
The folks at BMI would have a much easier job, artists’ checks would go way up, and for the 1st time in the music industry ever, there would be an accurate count of royalties from airplay, sales and even what people listen to online. Here’s to the future! What kind of musical world will you leave to Mick Jagger and Keith Richards?