Blockchain

Will Blockchain Tech Deliver Harmony In Music IP Management?

It’s hard to separate the headlines, sometimes, beyond the vagaries of huge price swings in bitcoin and cryptocurrencies. It’s hard, sometimes, to find the tunes the market might be fashioning beyond the cacophony of daily trading. 

 

But if the promise of blockchain seems to outweigh the soarings (and sore spots?) of cryptos, then tokenization and peer-to-peer trading are making inroads into old business models.

 

Consider the music industry, quite a bit less ancient than music itself, but hardly nascent, having been around – with publicists, publishers, royalties and lawyers – for more than a century. Who hasn’t harbored dreams of belting out the song that leaves the masses chanting for more?  To have the wellspring of creativity also serve as a fount of riches.

 

With creativity comes the age-old battle over intellectual property – and how it is distributed. 

 

In an interview with PYMNTS, Bryce Weiner, CEO of AltMarket – a peer-to-peer trading and fundraising network, which concurrently leads Tao Records and Tao Network, a blockchain system – said that blockchain can help musicians manage, and monetize, their songs.  

 

And along the way, maintained Weiner, transparency helps ensure that other stakeholders (fairly) get their piece of the action too, even while letting artists connect directly with the fans.

 

Weiner told PYMNTS that in principle, blockchain exists only in the event that an asset needs to be tokenized and traded between peers. In looking at the music industry, he said, the “process of assignment translates well to rights management applications for intellectual property.” 

 

As songs come to market, individuals take a piece of the royalties that accrue. But there is a disproportionate redistribution of wealth tied to that process, said Weiner. 

 

“You have a publisher, for instance, who demands more than they might be worth, simply because they are as big as they are and they can make that sort of demand.” And so, in the interest of transparency, said the executive, it becomes desirable to assign the rights (who gets what percentage of the money tied to royalties) and in what fashion. There are various silos for data used in various capacities, tied to who owns what. 

 

The impact for the artists themselves can be significant with such transparency. “If you can prove you’re Taylor Swift,” he hypothesized, “and you can prove cryptographically beyond any shadow of doubt that you the have the right to XYZ piece of intellectual property – right now, there is no central database for this.”

 

Though the idea of assigning rights in some sort of fair and proportionate way is not new, Weiner noted that the emerging consensus is that the data has value in making sure the distribution happens in an orderly way.  

 

Thus blockchain benefits the artist who wants to get a song or album up on Spotify, wants to reach a target audience and wants to make sure the music gets to where it needs to go – and yet, smart contracts enable a living to be made, too.

 

Said Weiner, “the only thing that blockchain has ever done in its nine years on the planet is move money from point A to point B.”

 

But as blockchain scales into new use cases, “there are all sorts of little things that are required to do that. You have to make people aware that it exists. You need a platform somehow that individuals are able to on- and off-ramp value into your ecosystem. If you look at how bitcoin evolved, all of those pieces are there and apply to every single cryptocurrency network” that include Ripple and Ethereum and, of course, many others, Weiner stated.

 

The music industry, he said, takes in $10 billion a year just in streaming alone, with global rights as much as $24 billion, and merchandising is billions more – in sum total, he estimated, $100 billion annually. It’s an industry that has been around for a century, and now “we are asking them to bring technology that not everybody understands what it is or how it works – but trust us with your $100 billion,” Weiner said, tongue in cheek, adding as a joke, “the first thing people ask when they see money flying around is ask, ‘how can I stick my hand in there and grab some for myself?’” Selling the blockchain concept to finance professionals is a lot easier, he said, than gaining approval from other industries.  

 

But as intellectual property management has lent itself well to blockchain, Weiner said that new initiatives have branched out to embrace ticket sales, and cryptographic tickets. 

 

“We’ve approached it from the angle of what already exists [in the music business,” said Weiner. “What do we know that works, and what can we adapt from that to create a new product?” he said of AltMarket’s initiatives – based on the simple concepts of tokenization and marketplaces coming together.

 

The reception from the music community has been one where “the excitement has been that we’ve got a line out the door … we’re at the early stages right now, getting our platform up to speed, and we’ve got all of our regulatory compliance paperwork and background checks – that’s already been done.”

 

He continued: “If you can sell records, that means you can put butts in the seats and you can sell tickets. If you can sell tickets, that means you can sell T-shirts. Within this paradigm, we’ll be inserting cryptocurrencies into the merchandising stream to where you can now create a ‘long tail’ of merchandising based on your fan base – all from the creative product.”      

 

Elsewhere:

 

This is the bitcoin tracker, after all. So, let’s see: Bitcoin prices rebounded a bit, to a recent $8,100 or so, after trading below the $8,000 mark. Not bad, considering that not all that long ago, the $6,000 threshold had been breached. The price of Ripple’s XRP made waves when it sank below $1 for the second time this year.

 

Beyond the price action: Banks are nixing buying the cryptos on their credit cards. JPMorgan Chase, Bank of America, Capital One and Citi have said no to the practice, wary of debt that accrues in the event that prices drop.

 

And when all else fails: Legislate? Treasury Secretary Steven Mnuchin is working with other agencies, such as the Fed and the SEC, to regulate cryptocurrencies. Turns out that China and South Korea and France … are not the only ones examining cryptos with a gimlet eye.

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