Vamping Up the Music Industry with Smart Contracts
Some of you may already know that I spent over a decade working in the music industry with some of the top artists in the world. I have a full stack of music accolades and awards to my name thanks to these artists. On the other hand, I also contracted work-for-hire musicians and bands for major studio recordings. As such I learned a lot from both perspectives; getting Grammy winners whatever they needed for as little as possible while promising as much as possible to the recording musicians (the band) that shaped these platinum selling artists' sounds and brands.
The lack of transparency in the music industry has unfortunately left thousands of deserving artists without their fair share of pay, album credits and performance royalties. Not to mention constant treatment as second class citizens who should consider themselves "lucky to be able to play for (insert major artist)" when so many other musicians would kill to be in their position. What position is that? One where you provided a service in exchange for forfeiture of payment because you should be honored to appear on a Grammy winning record. This is what I saw happening over and over and over again in my ten years working in the industry. It broke my heart and left many disheartened along the way.
What if those days are coming to an end? How could the open ledger system and smart contracts impact the lives of musicians, essentially creating an ecosystem where it would be impossible to get lost in the bureaucracy of the music biz?
Since Blockchain technology can be used to create a permanent, public ledger system for compiling data on sales, digital use and payments to performers, such as musicians, it's 100% feasible to imagine a database comprised solely on data that has been input on things like recording sessions, song credits, live performances and much more. This data is there forever, nobody can alter it once it's been added to the network.
In 2017, IBM partnered with ASCAP and PRS to adopt blockchain technology in music distribution. Everledger is one of the inaugural clients of IBM's blockchain-based tracking service and with major licensing companies on board, IBM is making sure data protects artists’ hard work and contributions. The world’s three major associations representing professional musicians and composers, ASCAP (USA), SACEM (Europe) and PRS (UK) recently announced a groundbreaking partnership “to prototype a new shared system of managing authoritative music copyright information using blockchain technology.” Doing so may further extend their reach and protect artist copyrights. The groups plan to use Hyperledger Fabric, the open-source blockchain technology from the Linux Foundation, so that they can “match, aggregate, and qualify existing links” between world-wide recording and copyrighting codes.
While the book publishing industry has long had International Standard Book Numbers (ISBNs) to identify and trace the work that authors create, music has never had a standardized shared system. Audio records are surrounded by messy, inaccurate, and limited information. Robert Ashcroft, CEO of PRS has declared that “the biggest issue facing the industry in the internet era is metadata.” Song files rarely carry metadata about who wrote the music, who performed it, who produced it, who else was involved with its production and who holds the rights to its use. This is a huge financial loss because without knowing who gets credit, people can’t be paid for their hard work. Similarly, without knowing who owns a song, it can’t be licensed.
With a blockchain network, rather than an opaque mess controlled by centralized industrial figures, there would be a transparent, decentralized shared registry in which each song
bears not only a unique fingerprint but also a unique, correct, and definitive set of metadata, indicating all appropriate song credits. Instead of independent musicians or labels having to get music distributed everywhere, they could enter it into the blockchain where it would be available to all together with listed fees. In a transparent, automatic, smart system, payout money would no longer be hidden. It would also obviate the need for many third parties.
Every artist would have their own digital wallet and get paid almost instantly after each project's data is added to the public ledger. Record labels would no longer have the power to blur the lines between artist compensation and actual unit sales.
In a very real-world sense, blockchain is the revolution that the music industry and countless other industries have been waiting for.