How decentralization dies: the killer concessions

MUSIC [1999–2008]

  1. THE PROBLEM (1999–2002)
    Major record labels did not make popular music available online
    • When they did, it spanned across multiple different sites and formats
  2. THE PROTESTS
    Napster, an application with a library of all music in mp3 format
    • Gnutella protocol (behind LimeWire), and derivations
    • BitTorrent
  3. THE CONCESSIONS
    Record labels agreeing to 99¢ music on the iTunes Music Store
    • Freemium licensing model behind Spotify

Attempt #1: pressplay

pressplay, an attempt by the music industry to gain back market share from Napster
The pressplay pricing model
  • Not every song was available for streaming, and among those that were, not all could be downloaded
  • You couldn’t burn more than two tracks from the same artist

Attempt #2: MusicNet

MusicNet, another attempt by the music industry to address the Napster protest

The Concessions Trickle In

A quote from Paul Vidnich, VP of Warner Music Group. iTunes would be the first legal, all-in-one competitor to Napster
The record labels made major concessions in dealing with Apple, on both digital rights management, and 99¢ pricing. From https://www.latimes.com/archives/la-xpm-2006-may-03-fi-apple3-story.html.

The Spotify Concession

Unlimited streaming services pushed music piracy protests to the fringes of society
Daniel Ek, co-founder of Spotify, shifts the goalposts further by calling iTunes a worse UX than piracy. From https://www.nytimes.com/2011/07/14/technology/spotify-music-streaming-service-comes-to-us.html,
“Daniel Ek profile: ‘Spotify will be worth tens of billions’”, the Telegraph (2010)

Effects of the Spoify concession

The Telegraph article, 2016

MOVIES [2000–2011]

  1. THE PROBLEM (2000–2011)
    Popular movies had an 11-year lifespan before becoming available for digital, subscription-based streaming
  2. THE PROTEST
    • BitTorrent for downloading movies
  3. THE CONCESSIONS
    Starz licensing deal with Netflix for premiere content in 2008
    • Floodgates opening to more premium channels agreeing to licensing with Netflix, future competitors
In 2011, Netflix accounted for 22.2% of all U.S. broadband traffic, while BitTorrent accounted for 21.6%. During peak times, Netflix accounted for 30% of all traffic.

What does this mean for cryptocurrencies?

  1. Borderless transacting without intermediaries
  2. Ease of access to banking and capital (creating a private/public keypair rather than being beholden to a bank)
  3. Legal, digitized gambling
  • Censorship resistance
  • Anonymity in transactions

What are the “killer concessions” for cryptocurrencies?

  1. A trusted “globalcoin” like Libra, where nations cooperate to regulate a currency spanning borders.
  2. Nations digitizing their sovereign currencies on an interoperable (or single) blockchain, so people can easily transact with each currency.

Isn’t decentralization the point of cryptocurrencies?

Wrapping Up

--

--

--

Building something new! Bitcoin, security, mining. Former early @Gemini.

Love podcasts or audiobooks? Learn on the go with our new app.

Recommended from Medium

A Year and a Half in the Life of Metallica Film Review

21 Songs That Will Turn 10+ Years Old In 2021

Can you modulate sound with your thinking mind?

365 Days of Song Recommendations: Oct 16

One More Parade-Phil Ochs

Why Billy Joel is Cooler Than You

Who to Follow on YouTube for Studio One Content

The Unfortunate Duality of Proverb

Top 10 — January 3, 1970

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Brandon Arvanaghi

Brandon Arvanaghi

Building something new! Bitcoin, security, mining. Former early @Gemini.

More from Medium

Cardano activates its first ERC-20 converter on its blockchain

The resonance between the monetization of land elements and the privatization of public debt:New…

Finvault’s insider scoop from the world’s biggest blockchain summit

What is ZKPad?ZKP Cryptocurrency Complete