Is Blockchain the Answer to Challenges in the Music Industry?
Right now, everyone is buzzing about blockchain. Companies across multiple industries are already adopting this technology and seeing great results. When implemented well, it can revolutionize everything from real estate to media. So, is blockchain the answer to challenges in the music industry as well? Can this technology guide us past roadblocks the music business faces? There are many ways that blockchain can add value to the music space. Here’s our take:
What is Blockchain?
Not sure how blockchain works? Here’s a crash course:
According to authors Don and Alex Tapscott “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”
Let’s break that down.
A blockchain is a record of transactions. This public ledger is tamper resistant. What does that mean? It means that whenever a transaction is recorded, it’s visible to everyone involved in the blockchain. These records are difficult to change, and if they are edited, that data is made public too. This eliminates disputes over the accuracy of information.
How Can Blockchain Solve Problems in the Music Industry?
Remember, blockchain acts as a public record for financial transactions and any other transactions with value. This transparent system can change the music industry. It empowers artists and companies when put to good use. Here are a few problems blockchain can solve.
Royalties
The music industry has a piracy issue. (More on that below). However, this is being partially disrupted by the convenience of music streaming services. The problem? There aren’t good systems in place. It’s become difficult for rights holders to be paid fairly and on time. Streaming services need a modern solution that rights holders can also get on board with.
How could blockchain solve this problem? The concept is that a public ledger could hold information about music and the rights holders. Then, smart contracts could automate royalty payments. This would ensure that compensation is handled properly.
Distribution
One of the biggest concerns when it comes to music distribution is fighting piracy. This is an area that blockchain could make serious waves in. Today, technology makes it simple for people to share and make copies of music. It’s a battle that the music industry has been fighting since the MP3 format started gaining traction in 1997.
Blockchain could be used to prevent listeners from “ripping” music files. One way to do this is to encode music on the blockchain. This would prevent those files from being played if someone attempts to copy the content.
Licensing
When it comes to music licensing, the issue really comes down to missing or inaccurate data. There isn’t a single database that holds all this information. In addition to that, the information that is available often doesn’t include data for each rights holder or ends up becoming inaccurate as ownership is acquired by another party.
Blockchain could serve a public and current database so that there is only one version of this data. This would allow rights holders to track their content and give them insight into how it’s being used.
Is Blockchain the Answer to Challenges in the Music Industry?
Blockchain can be the solution that the music industry needs. This technology offers resolutions for issues that the industry has been struggling with for decades. It can give this business transparency, security and make the music space more efficient than ever before. The true potential for blockchain technology will continue to be explored. With that said, one thing is certain. This opportunity for players in the music industry to take control, overcome challenges and make meaningful changes can’t be ignored.
