The Bitcoin Blockchain Might Save The Music Industry…If Only We Could Understand It
In an era when income is measured in the fraction of a penny earned as music is streamed, shared and otherwise exploited across the globe, proper compensation of creators is an issue of growing urgency. But there may be an answer, if we can understand and embrace it, says music business scholar and entrepreneur George Howard in this first of a must read series on Blockchain and the music industry.
Guest post by George Howard.
Blockchain, specifically, are not easily understood at first glance. However, the implications of the Bitcoin Blockchain not only for currency, but for intellectual property are too great not to expend the time and effort needed to see its applicability.
The alternative is to let the technology go the way of Creative Commons; another tool with tremendous application, but equally tremendous misunderstanding – and thus underutilization.
This led me to a company called ascribe. ascribe utilizes the Bitcoin Blockchain to, in their own words, “enable you to share your digital creations without worrying about losing ownership rights.”
I’m genuinely excited about Bitcoin. Dominantly, this excitement comes from the fact that transactions using Bitcoin that are confirmed are included in the Blockchain. The Blockchain is a record of all transactions.
This has tremendous application for IP. ascribe is focused on visual elements, however, the utility of this approach extends way beyond visual IP. Music, for instance, seems to me a prime candidate for this type of use-case.
Certainly, such a process would allow for the better trackage of usage of music, which would lead to more accurate compensation for rights holders.
For example, if I am a performer signed to a label, I could assign the rights to my Sound Recordings, and monitor – via the Blockchain – the ways in which the label exploits this Sound Recording (sales, licenses, streams, etc.). This would greatly reduce controversy (and related transaction costs – audit time/money) around royalty payments, etc. Similarly, the label/publisher (or – as I would encourage – artist) who releases the work could lend (i.e. license) the Sound Recording and underlying Composition to streaming services, broadcasters, etc., and monitor – via the Blockchain – the ways in which these rights (Sound Recording/Composition) are used.
In this manner a great deal of transparency would emerge. With increased transparency comes increased speed and desire for deals/transactions.
Certainly, if the music industry has any hope of taking advantage of the new opportunities available to them via the transformation of music to information it will require this type of transparency that will lead to more accurate information, and thus better decision making with respect to deals.
My fear is that the Blockchain (and innovative companies like ascribe) will struggle to gain the understanding required to achieve widespread usage. In short, my fear is that the same fate will befall Blockchain (for artists) as seems to have befallen Creative Commons; people just do not understand it, and CC does a bad job of explaining it (which is a shame), and thus most don’t utilize it.
This is really as much an educational (or marketing/branding) issue as it is a technological one. The stakes are too high not to at least try to create the same transparency around the understanding of the technology even as the technology itself attempts to create transparency around its usage.
Artists – visual, musical, or otherwise – really must educate themselves about these emerging technologies, or suffer the fate of being exploited by those who do.
George Howard is an entrepreneur, educator, advisor, and angel investor. He was the President of Rykodisc, one of the original founders of TuneCore, and manager of Carly Simon. He recently co-founded Music Audience Exchange, is an Associate Professor at Berklee College of Music , and advises numerous creative companies. He is most easily found on Twitter.