Blockchain can make Soundcloud a Revolutionary Music Label
The biggest obstacle to musicians is the music industry. Soundcloud can free artists from self-interested industry middle-men using blockchain. The platform has already opened up the whole world for anyone making music. It can revolutionise our soundscapes again.
My career in radio, working with music and artists has taught me the following:
The Music Industry Mess
The world is full of extraordinary songs by artists with no fans, labels or money behind them. These songs go nowhere because exposure to audiences is carefully controlled by companies who seek to promote their own artists. With money and networks, you can buy legions of social media followers and use them to dupe the public into listening to your tracks. With a stable of artists, you can influence concert and festival creators to make space for your lesser-known performers in exchange for providing your bigger names for the lineup. Similarly, when you own the rights to distribution of massive songs, you can easily get the attention of radio station music compilers and TV show producers. If they want the international hits, they must play your smaller records. With money, you can buy exposure through adverts, interviews, reviews, song placements and (of course) payola. Mickey Elfenbein of K-tel (sometimes described as the Spotify of the 70s) said that “Sometimes we’ll have $2 million spent before we sell one record.” And that was forty years ago, when the music scene was much less developed and competitive. The biggest names today spend tens of millions on music distribution to make hits.
How can somebody with no social media love, and no company to get powerful media decision-makers to even hear their music, get airplay that could go to a megastar instead? Internet-based platforms like Soundcloud and YouTube have given creatives worldwide audiences. Some musos get lucky by going viral through originals or covers. If they get very lucky, they get record deals. But if they don’t?
And many musos just don’t know what is needed to protect their music. All over the world, artists are required to be registered with official bodies that register music, uphold copyrights, and ensure royalty payments. But often it is notoriously difficult to find this information at all, and artists seek labels to protect them, and all labels prioritise established artists for their own profit incentive, so many, many, many artists are signed but disabled by record companies.
Soundcloud can be the record label for the 99%.
Music Labels by Blockchain
Using blockchain to bypass failures in the music industry is not a new idea. In the words of Phil Barry, blockchain technologies can create “a transparent and decentralised database of rights and rights owners, and automates royalty payments using smart contracts and cryptocurrency.” Blockchain makes it possible to sideline all of the self-interested middle-men who currently take their cuts of revenue on music before it reaches the musicians. This is one reason why Grammy award-winning artist Imogen Heap is championing blockchain. And blockchain combined with a codec could become a means of storing music that cannot be pirated too.
Different startups have taken diverse approaches to blockchain solutions. After a losing a messy legal battle, Spotify bought a startup to try and correct for its own inadequate attempt to pay royalties. Clearly, blockchain will have a tremendous influence on the future of music. I think Soundcloud stands to give the greatest blessing to artists if it goes blockchain.
How Blockchain will improve Soundcloud
Through Soundcloud, any artist can reach a worldwide audience. Soundcloud has 175 million active listeners per month (its closest streaming rivals only have tens of millions), and the company purposefully exposes users to new and little-known records and creators. Many artists credit Soundcloud for enabling their careers. Whole genres have risen to mainstream popularity through it. Soundcloud is already the go-to platform for artists of all kinds to get exposure. Unlike currently-existing blockchain music start-ups, Soundcloud has the reputation and the audience to give all of their artists the full benefit of blockchain technologies.
So let’s say Soundcloud either builds a new blockchain system or buys into an already-existing one. This will enable Soundcloud to provide crucial benefits of an industry label or publisher, without any of the humans who make the music industry a mess.
Blockchain protects your Copyright
Artists are hammered by intellectual property theft. Agents steal music. Labels steal music. The internet in particular steals music. Blockchain stores information in blocks, and the blocks are spread across millions of computers in huge networks. This means that information stored on blockchain is largely safe from hacking, and incorruptible, because information is decentralised. It can’t be targeted in a single host location. It isn’t under the control of any lone entity. And every single upload is enshrined in publicly accessible contracts.
As soon as any content is uploaded to the internet, you can use the upload information to prove that you hold the intellectual property right over the content, provided the upload information shows that you uploaded that content before anyone else created it. But, sometimes, an upload to an online platform cannot accurately capture who owns the content. Say a song has a vocalist, two songwriters, three producers and a production funder, who have all agreed to split proceeds from the song amongst themselves. If a dispute over payment arises later, many uploading mechanisms won’t preserve the ownership breakdown. Smart contracts allow you to capture those details when the song is uploaded to the blockchain, and those contracts keep everyone accountable because everyone on the network can view them at all times, so intellectual property and ownership agreements can be upheld with ease. And smart contracts have more uses.
Blockchain allows Artists to take full Control of Sales
Smart contracts allow people to create contracts that are enforced by a public ledger on the blockchain network. They can be automated to only come into effect when conditions are met, like payment for information stored in a block. Imogen Heap is championing artists selling their music directly to listeners in this way. Musos can sell to audiences without meddling agents or promoters through smart contracts.
Soundcloud aims to be a free and open music platform, but it also aims to enable its artists to make money. Soundcloud could become an extraordinary revenue stream for artists through deals struck with advertisers that are contractually binding via smart contracts. Soundcloud can automate payment from an advertiser to an artist whenever their song is streamed by a listener, in exchange for advertising appearing with the song. This allows Soundcloud to sign big-money contracts with advertisers to get their marketing on any or many streamed songs. More interestingly, this allows artists to sign deals with advertisers on campaigns that only run on their music when it is played on Soundcloud. Through this, creators have power to negotiate deals that are beneficial to them with advertisers directly. They don’t need agents or publishers to handle the negotiations. They don’t need middlemen to do the legal work or handle the financing. The blockchain does it all through smart contracts.