Since the 1999 launch of Napster’s music-sharing platform, the music industry has been in near-constant turmoil, its timeline marked with dipping revenues, lack of transparency, piracy problems and feuds over the fair distribution of dividends.
Music companies hate streaming services. Streaming services hate file-sharing services. And, most of all, artists and content creators hate virtually everyone else for making huge sums off their toil and feeding them the crumbs.
With so many conflicts of interest, there seems to be no one service or business model that can work in a fashion that satisfies the needs of all the parties involved. But now, after years of suffering from a thorny and complicated relationship with the tech sector, the music industry might finally find a chance to head in a positive direction by leveraging the blockchain, the technology that powers the bitcoin cryptocurrency.
The blockchain has drawn the attention of investors and professionals in different industries, and is now showing promising signs to change the music industry in ways that might fulfill the needs of everyone.
Well, almost everyone.
Why can blockchain be a good technology for music distribution?
At its core, the blockchain is a distributed ledger that can validate and register transactions without the need for a central authority. No one owns the ledger — it’s spread across the nodes that constitute its network and is publicly available to everyone.
Information stored on the ledger is interrelated through cryptographic hashes, which make it virtually irreversible and tamper proof. In a nutshell, it means that parties can make peer-to-peer exchanges of data, money or anything else of value in any amount and in a secure manner.
One of the advantages of a blockchain ledger is that it can establish a more direct relationship between creators and consumers.
In the music industry, the blockchain could transform publishing, monetization and the relationship of artists with their communities of fans.
First, music can be published on the ledger with a unique ID and time stamp in a way that is effectively unalterable. This can solve the historic problem of digital content being downloaded, copied and modified at the leisure of users. Each record can store metadata containing ownership and rights information in a transparent and immutable way for everyone to see and verify. This will ensure that the correct people will get paid for the use of the content.
Blockchain technology can also revolutionize the monetization of music. The infrastructure is based on smart contracts, programs that can be run on the blockchain along with the payment transactions. Blockchain-based cryptocurrencies such as Bitcoin and Ethereum support micropayments, which is effectively impossible with classic payment mediums due to transfer costs. This can support a new way of offering on-demand music services. Users can select the record of their choice and immediately…