Blockchain is the breakthrough technology which will benefit the music industry by catering to the various problems faced by the industry. Some of the common problems faced by the music industry are:
Dependence on intermediaries:
Over the years, the music industry has worked in such a way that artists have had to rely on intermediaries in the form of labels, promoters, and distributors to reach out to their audience.
Due to a large number of intermediaries the artists’ revenue distribution gets complicated where every intermediary take a portion of their income.
Through blockchain, music creators can publish their work and sell it to their fans directly without a third party.
By uploading their works on the blockchain (can be done through various blockchain based music platforms), artists create a transparent database which can be viewed by anyone. Artists receive their share immediately instead of months or years as is now the case.
The music industry is littered with products which focus on singular aspects of the industry which is a result of the flawed music licensing model which is perpetuated by the major labels and publishing companies. Streaming licenses require companies to pay charges to access the library of millions of songs available. To cover up the cost of licenses and profit, companies have to add advertisements in between different songs, which also disrupt user experience. The On-demand licenses charge a higher fee and a percentage of the revenue to access the library of music, therefore, this service requires high subscription fees and heavy ad support to pay the artists and cover costs.
Through blockchain, artists can gain direct control over their material and get remunerated for various uses of their songs. Since the concept of middlemen is ruled out, artists over a blockchain based music platform can present their product to their audience with any disruption in the form of advertisements.
Streaming platforms use a complicated formula for distributing royalties to the artists under contract. Over the years it has been observed that artists are underpaid for their work.
Blockchain being a transparent system, ruling out intermediaries, enables artists to get paid directly using smart contracts that guarantee transparency.