An all encompassing smart contract for the music business

Patrice Lazareff
May 8 · 7 min read
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Abstract

Blockchain and cryptos have a tremendous future for the music business and we already have some promising implementation such as Emanate, Musicoin or UJO Music, even if the latter seems a bit abandoned at the time of writing.

However, those various attempts seem to all suffer from similar weaknesses. While it is almost certain that the people behind them are tech savvy and blockchain specialists, they seem to lack important knowledge about the actual meaning of monetization of music recordings.

This series of posts will attempt to describe the music business subtleties in order to help developing a truly global smart contract that could handle any and all situations that may arise alongside the many stages a piece of music goes all the way through from writing a melody and/or lyrics to the many forms its communication to the public may take.

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« Sell your music » has become a fairy-tale mantra

No, you can’t simply « sell your music! »

Most if not all platforms, including both traditional and blockchain-based ones, address artists with similar tagline along the « sell your music » mantra. But things are not that simple, and they know it.

This is why careful reading of their terms and conditions (which almost nobody cares to read) invariably state at some point that “you (the user)” are the sole owner of all of the published material or that you do have obtained written permission to make it public.

In other words, they act as if you (the user) had made or bought something to sell it with a bonus, just like if it were a T-shirt or any other physical good.

But music does not function this way. You may indeed have actually paid for a sample, or even a full multitrack original recording or a musician’s performance. But this does not mean that you have bought it in the sense that it became your full property. What you’ve actually paid for is only the right to use it, to some extent and under certain conditions, just as if it were an entrance ticket to an amusement park. Put bluntly, paying for a taxi ride does not allow you to take the car away and resell it.

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Current blockchain-based music platforms are doomed to fail

This is the main reason why, even armed with the most generous intentions, none of the emerging blokchain-based music distribution platforms have a single chance to succeed in attracting or keeping popular artists.

Such artists, even if they emerged from some kind of alternative/niche/diy scene, will invariably fall into the hands of the legacy industry when they will need a real boost in their career. And when that comes, the legal link between the artist and the platform won’t hold.

And should one of these new platforms attract millions of users, the legacy music industry could easily have them by the throat and, in the best case scenario, bend them into contractual relationships that may be mutually beneficial, which means in plain english eventually not in the artists’ best interest.

Actual needs vs. own private Idahos

For the past ten years or so, I’ve closely followed many blockchain-based projects, not only in music[¹].

Quite understandably, most of them focus on offering a complete solution to a given problem, such as document management, market prediction, e-commerce, social network, etc.

To the contrary, some do not aim at being standalone solutions but essential bricks of inter-applications flow. The major example being identity management or data storage.

Oddly enough, in the music business domain, all startups seem to fall into the former category, each and every one of them creating its own mechanism and none of them being fully compatible with the way music business is being conducted where the real money is.

The actual need, if we want to seriously set foot in the twenty-first century is not another Soundcloud nor a decentralized Spotify.

What is needed is a new type of middleman, possibly in the form of a DAO (Decentralized Autonomous Organisation), able to handle all of the legal and contractual aspects of music conception, production, distribution and promotion.

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Now, the good news

As a side effect, such a mechanism would also act as a comprehensive catalog of recorded music that could be used without asking permission first, as any use would necessarily imply that any and all rightholder and interested party are respected.

Any music user would only have to interact with the DAO to retrieve all of the needed information to operate. This will tremendously jumpstart any initiative on how the music may be used : streaming platform, collaborative sites à la SoundBetter, new music discovery like HumanHuman, sampling licensing and so on and so forth, you name it. Each and every new or existing venture can rely on the DAO to legally provide content and focus its energy on its own specific offer to stand out from the crowd.

Instead of being perceived as yet another menace, the cryptosphere can become a major problem solving tool for every music professional, amateur or fan.

The good news is that we now have all of the tools that may be needed to make this happen. Moreover, these tools are not that difficult to use.

Of course, the legacy music industry will resist. It always has. And they hate the very idea of collective management of neighbouring rights. But our project goes far beyond that, even if, let’s call a spade a spade, it is indeed a decentralized autonomous collective rights organisation that we’re discussing here. But if it ends up benefiting to them too

Next posts roadmap

The next posts will go through all the contractual aspects of writing, recording and distributing music.

This will also be a way to demonstrate that the proposed mechanism is in no way intended to weaken or replace existing organisations, but to facilitate their operations.

Writing music

The internets have opened the floodgates of international collaborations between all kinds of composers and lyricists who may never physically meet. While IP law is rather consistant throughout the world, thanks to WIPO, some countries recognize moral attributes and some don’t, including the USA.

  • New works registration
  • Identity management
  • Managing co-authorship
  • Arrangement and adaptation
  • Main challenge : verifying sincerity, importance of current CMO’s
  • Music publishing deals

Recording music

  • Linking a recording to an existing registered work
  • Artists, additional musicians, technicians : production and co-production, employment or profit-sharing ?

Distributing music

  • Digital files storage considerations
  • Record publishing deals
  • Managing synchro
  • Advantages of a permissionless system (3D printing for vinyls will soon be a reality)

Promotion

  • Profit-sharing
  • The major shift (copyright ain’t broken, we just need to update our views about the public)
  • Main challenge : the incentives to use music within the DAO framework

Dispute management

  • Can some sort of “proof of stake” be inspiring

NOTE : This roadmap is more of a reminder to myself than the actual titles. Hopefully, some of these posts to come will have some code to complement them :-)

RFC

If you’ve read up to this point, thank you.

I am litterally begging for comments, suggestions, even insults as long as they are constructive :-)

Also, please consider sharing/forwarding this post to anyone you think might be interested. The more the merrier.

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Final words about myself

Just so you know : I’m french and my main occupation for the past 35 years is recording and mixing music. I’ve worked with many famous artists for major companies as some of my credits on Discogs show.

It so happened that I also started developing websites back in 1999 and am still doing it, moderately. In those days, the RIAA wanted Napster dead and I was one (lonely) voice to say how bad that idea was as, unlike music publishers, I knew how internet works and what open-source software is.

This led me to University (Paris 1 Panthéon-Sorbonne), aged 42, to better understand music’s legal aspects. After four years, while keeping my two jobs full time, I got a Master degree in business law.

After that, I started teaching music business and contracts for both the School of Audio Engineering (SAE) and Abbey Road Institute in Paris.

I wrote « Le guide juridique du musicien » (KR/Dunod 2019).

More recently, I also started a Youtube Channel (in french) about the music business.

[¹]: I mention the main ones here as this project will refer to many of them : IPFS, Factom, Storj, Augur, Synereo/Hyperspace (now defunct), Akasha, OpenBazaar, Agrello…

Patrice Lazareff

Written by

Music Business expert. Aiming to build a smart contract fully compliant with intellectual property framework and actual practices of the music industry.

Patrice Lazareff

Written by

Music Business expert. Aiming to build a smart contract fully compliant with intellectual property framework and actual practices of the music industry.

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