With the advance of cryptocurrencies and blockchain, futuristic economies may attempt to tokenize everything. Things like coffee, groceries, and even artists and musicians. That is correct, anybody could tokenize their ranges of abilities and get paid in crypto, or shockingly better, have their very own token.
For the record, these tokens would be validated by a public blockchain, which would authenticate their credibility, as well as rights of their performance.
In April 2018, reports suggested Australian buskers increasingly moving towards accepting bitcoin, which proved that cryptographic methods of payment would serve perfectly for musicians. Of all industries to be benefited by the blockchain, the music industry, however, remains untapped by blockchain technology.
The music industry is a flawed business model, with record companies and production houses taking the most of an artist’s income and meagrely paying the performer. For an example, look no further than Italian opera singer Enrico Caruso.
One of the first artists to be recorded, Caruso was famous in the 1900’s for his operatic tunes. He recorded over 488 songs in his lifetime, largely for Victor, a record label now owned by distribution giant Sony Music.
While Caruso made over $2 million from sales of his music, Victor made an estimated $4 million, and continues to make money each time a Caruso album is sold.
Contrary to popular belief, CDs and vinyl sales do not make artists particularly rich. This is confirmed by a techdirt report, which confirms every $1,000 worth of albums sold can be broken down into average of 63 percent going to the record label, 24 percent to the distributors, and a paltry $23.40 to the musician.
However, then came the Internet.
Times They Are A-Changin’
According to The Economist, Amazon CEO Jeff Bezos was looking for e-commerce opportunities in 1997 and considered selling music, only to realize the monopoly of a few music labels which had the financial and political power to stifle any upcoming music startup.
Then came Napster in 1999, which offered a free peer-to-peer music streaming service that compressed music files to make them easy to load. However, the popularity of Napster soon attracted the wrath of music labels, and the company found itself facing litigation on all ends.
In 2001, within two years of its launch, Napster was closed by court order and the brand survived after all its assets were liquidated and purchased by other companies through bankruptcy proceedings.
Companies like Apple Music and Spotify have proved to be multimillion dollar business models, and celebrities and artists align with labels to provide an exclusive insight into their lifestyle of luxury.
However, despite all the attention, the truth is not farther than the 1900s – artists still earn paltry amounts compared to music outlets.
Spotify admits the average per-stream payout to rights holders lands somewhere between $0.006 and $0.0084. Hence, this model proves an artist will require over 200,000 plays of their song every month to make the bare minimum U.S. wage.
(Source: information is beautiful)
The highly-celebrated investors are not getting any richer either – while Spotify has an estimated 140 million active monthly users, the company booked a quarterly operating loss of €41 million (around $47,814,000) in May 2018.
Additionally, Jimmy Lovine, whose fledgling Beats Music service was acquired by Apple Music, warned in 2017 that music streaming is not a great business and that there is no profit margin.
In spite of the burgeoning losses, executives of Spotify earned over $1.34 million each on average, with over $26 million shared between the top five executives.
By a long shot, the greatest earners are, obviously, the record labels, with the “big three” making a record-breaking $14.2 million daily from streaming services like Apple Music and Spotify. The Universal Music Group alone made $4.5 million at regular intervals.
So what should be possible to settle this broken plan of action and guarantee that specialists get reasonable remuneration? Austrian maker and author David Brandstaetter, trusts he has the appropriate response.
“Streaming services pay artists pennies, partly because so much is swallowed up by the record labels. Spotify isn’t profitable, but the public won’t support a price raise,” says David, “The only way for artists and collaborators to receive fair payment for their efforts is by decentralizing the industry and taking the power out of the hands of the record labels and streaming services. Blockchain technology is the perfect enabler for this.”
For the last two years, David Dr. Sascha Dennstedt, his business partner, are working on blockchain-based music platform Qravity, which allows creatives to connect with each other and collectively develop and monetize original digital content. The platform uses virtual tokens on the Ethereum blockchain to track digital media creation and distribute project stakes among creative team members
“Using Qravity, musicians can collaborate and work in exchange for stakes in the project. The content will go direct to market, so if a songwriter has, for example, a 30 percent stake in the project, he receives 30 percent of the revenue every time his songs are streamed or downloaded.”
The platform contains a comprehensive suite of project management and communication tools to help creatives collaborate remotely; it also rewards them with a greater stake in projects as they complete each milestone.
“We want to completely overhaul the entire industry,” says David, “With Qravity, we’re transferring the power and profits from the executives to the talent, transparently and equitably.”
Get QCO during the Qravity token sale.
Presale with 30 percent bonus: July 2 to16, 2018.
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