The Blockchain: Could This Change the Music Industry Forever? Read This. It Could Be Important.
Whilst the world remains caught up in debates over music streaming and the music industry is being berated for not being transparent, there’s something else going on the in background that could be very, very disruptive to what we hold familiar–and it hearkens back to the basic concept of peer-to-peer sharing. Read this story from Billboard very carefully. Something’s happening here.
The blockchain is a decentralized system, with no single entity controlling it. The servers keeping its backbone upright are scattered across the globe, and for that reason the technology is transparent; everyone can see its anonymized data. It could also replace notaries, as every transaction is time stamped automatically and receives a unique ID. No exchange rates apply either, because cryptocurrencies are oblivious to borders. And because there are no intermediaries involved, monies are transferred instantly.
Two companies, both still in development, show the technology’s potential for the music business. PeerTracks, which plans to launch in about two months, plans to use the technology to create a type of artist equity trading system. Another, Ujo (‘container’ in Esperanto, the international auxiliary language made semi-infamous by William Shatner) is building a system designed to address two major problems in global royalty distribution and licensing.
PeerTracks, according to its president Cédric Cobban, is a “music streaming and music retail platform that allows for fan engagement and peer-to-peer talent discovery.” PeerTracks will use the blockchain for its transactions, paying streaming revenue on a per-user-share basis, meaning that the revenue each user generates will go directly to the artists users are actually listening to.
Follow so far? Let’s skip to the part about scarcity.
Just like the real world, the valuation of PeerTracks tokens is determined by supply and demand. Tastemakers can buy tokens of unknown artists while they are cheap, speculating on that creator’s future potential. “Boom! Your incentives have been magically aligned with that of the artist,” Cobban explains. “You now want that artist discovered, you want him to sell music. You want him to be streamed and sell merchandise, because your tokens can go up in value as that artist becomes more successful.”
“Some users might not be interested in combing through newly uploaded content,” Cobban continues, instead opting to listen to what’s rising.
Ah. Just like the Olden Days when people went out and bought records that were rising on the charts. It was when you wanted to listen to whatever everyone else was listening to for fear of being left out.
Could this work? Read the rest of the story and formulate your own opinion.
