Music fans spend decades acquiring and listening to new music. A new wave of blockchain-powered music businesses is asking them to do things a little differently.
This is the challenge that blockchain-powered music platforms face: we’re creatures of habit, and music fans aren’t eager to re-tool the intricacies of their music collections. New platforms will need one heck of a pitch to persuade Spotify and Apple Music users to switch.
Plenty of startups demonstrate more hype than substance, and they don’t solve an urgent-enough problem to be a viable business. Other project heads simply don’t understand blockchain on a technical level and don’t stand a chance of building a scalable, bug-free solution.
Blockchain innovators in the music space must find out what industry professionals and customers demand, then provide a solution. Anything else is a waste of time.
1. John Wagster, Co-chair of Frost Brown Todd’s Blockchain and Digital Currency Team
“Upending the music industry’s status quo is the biggest challenge adopting blockchain. The industry universally accepts the somewhat imperfect system developed over the years by performance rights organizations. They’re also so politically connected that the current system’s allocation of music royalties is in many ways built into existing law. Technology exists today to automatically track how often songs are downloaded and played and the price paid using the blockchain’s digital metadata, and instantly send appropriate royalties to a musical work’s participants. Nevertheless, it’s difficult for an unfamiliar technology to unseat an entrenched incumbent system.
Another challenge: blockchain-based performance rights solutions will work great with digitally recorded music moving forward but will have a hard time dealing with music recorded prior to the development of their solutions.”
2. Nigel Rudlin, CEO and Founder of indieOn
“Misinformation about blockchain itself. In order for blockchain to proliferate, there needs to be greater adoption by artists. Artists have shown remarkable adaptability to new technology in tools to create music. What they need to do is refunnel that spirit into understanding distribution as a technology. There is a learning curve for participating in this new world. Artists need to push past this and think technically about music distribution as an economy, in and of itself not just the old standard of “penny-rate royalty”. This means a change from passive to proactive understanding of how the distribution technology works and the opportunities available for musicians, early adopters and investors.”
3. Josh Tucker, Partner at Pillsbury LLP
“Currently, user experience friction and security concerns impede adoption at the consumer level. People have a difficult time keeping their email secure, let alone digital bearer assets accessed with novel interfaces, like blockchain tokens. And most people don't want to deal with gas on Ethereum to listen to a song.”
4. Vasja Veber, Co-founder and COO of VIBERATE
“The 2017 price hype resulted in everyone putting their focus on getting rich quick and no one really cared about tech. And when the prices collapsed, everyone was again ignoring the tech and was seeing blockchain as a bursted bubble. So we need a bit more time for the dust to settle and we need to overcome a few issues (scaling, speed, UX) to see the first major blockchain-based service for the music industry.”
5. Ricardo Porteus, Founder of Bleep.me and Dance for 1 Meter
“Having a real benefit and need for blockchain and a token economy in the music industry is the biggest challenge and will continue to be so. Several platforms including UJO, a ConsenSys funded music streaming platform, and CHOON, a private equity funded music streaming platform, both launched and aimed to reinvent and launch their own music token economies, both with great visions and teams yet minimal traction as the industry is not quite ready to dive in both feet first. The USP is not strong enough to drop the major platforms in favour of a new complicated token powered alternative.”
6. Stephen Glicken, Founder of Project Admission
“The most tortuous wall is the industry’s landscape and realities. New companies in ticketing are faced with two paths for traction. This is especially true for blockchain ticketing companies. They either work with existing players to integrate or it replaces existing ticketing systems with a soup-to-nuts product.
We believe the first path is slow going as fully integrating a blockchain-based technical solution with any of the existing incumbents is complicated and cumbersome.
The second path not only requires substantial sums of money to pay building advances but a fully built, mobile-first ticketing platform that can handle the rigors of onsales and the demands of venues. When we did the math of what it would cost to pay the buildings and hire an appropriate sized tech team, we were gut-punched. Moreover, with incumbents like Ticketmaster and Eventbrite and younger upstarts such as SeatGeek and ShowClix, it feels like you’re in Gladiator playing for your life. Suffice to say, none of us wanted to sign up for that type of experience.”
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