How will NFT and Web3 help change the current music market?

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2022-07-22 18:48:46

How will NFT and Web3 help change the current music market?

Thanks to digital technology, the music market has undergone tremendous changes over the past two decades. Music creation no longer requires a production team and sound engineers, but instead an artist can create music from his bedroom through cheap software. Similarly, music distribution no longer requires factories to produce physical recordings (tapes, discs) and relationships with stores to get products sold there. Technology, especially the popularity of the Internet and smart phones, has helped music products to be digitized and artists can distribute their own music products to listeners.

And now, the music market is facing major changes in the future thanks to blockchain and NFT. So how will NFT music create a new future for this market? Let’s AntiAntiNFTs Club clarified in today’s post.

The problem of the current music market

Artists are facing the same problem that they get a very small share of their revenue directly from music productions. According to a report by CitiGroup, artists receive only about 12% of the total revenue from their music production. Most of the remaining revenue will go to record labels and streaming platforms.

Record labels can be seen as a venture capital fund that invests in artists. They can support artists financially and with marketing in the production and distribution of music. However, these record labels are taking between 50 and 90% of their revenue from artists’ products.

Besides, according to some statistics about Spotify, out of 8 million artists who publish their products on this platform, only about 42,000 artists (0.53%) can earn more than 10,000 USD/year and only 13,400 ( 0.17%) earn over 50,000 USD/year, this is the average income of workers in the US as of 2020.

Thus, we can see that artists are currently being unfairly confronted and cannot make much profit from their own products, even the money they earn is not enough to maintain their passion. his passion.

However, the music NFT or more broadly web3 has the potential to create a new streaming profit model as well as a new interaction model that will allow artists to build a more successful and stable career.

A new record label model

In the past, it was usually only the big record labels who were looking for and investing in artists. However, the emergence of blockchain, DAO, and NFT created a new record label model. Artists can now crowdfund to grow their music and careers through the release of NFTs.

For example, some music NFT fundraising platforms such as Royal, Corite, etc., where artists can create their own NFTs and sell them to raise capital. Those who buy these NFTs will get a share in music ownership, which means they will receive revenue from the artist’s music products and besides many other special benefits.

A recent example is rapper Binz’s sale of his NFTs through a platform called Tuniver. Binz pledges to share a portion of the revenue from the song “Don’t break my heart” to NFT holders. For the highest-ranked NFTs, in addition to sharing profits, holders also have the special benefit of participating in a private dinner with this rapper.

This model not only makes it easier for artists to raise capital without being dependent on record labels, but it also helps to change the relationship between fans and artists from a music consumption position to a development partner. together.

Artists get capital, fans get invested and get profits from their idols. Fans have many opportunities to join the artist’s journey and be rewarded for their support.

However, this model is still limited. There is currently no solution to be transparent about how much revenue artists actually receive because most of their revenue still comes from traditional music platforms, not built on blockchain.

Web3 streaming platform

Existing music streaming platforms like Spotify, Apple Music are a third party taking most of the artist’s revenue, and these platforms are always pushing to cut the artist’s revenue to make a profit. high for the company itself.

In 2021 in the UK, More than 150 famous artists have joined a campaign in an effort to call for a new law to “put music back where it belongs”.. They argue that streaming platforms and record labels have taken advantage of artists without rewarding them fairly.

Web3 or blockchain has opened a new direction for the music industry. In essence, web3 helps us cut out the middlemen, build a decentralized model and give more benefits to the participants. In this case, we can talk about the model of Audius, a music streaming platform built on web3 that wants to put control and revenue on the artist’s side.

Imagine Audius is like Spotify, but where artists have more rights and control over their products, bringing artists directly connected with music listeners. Any artist can post their work on Audius without having to be an established artist or sponsored by any record label. Artists have the right to decide whether their work is free to listen to or charge a certain price for special content. Unlike traditional music streaming platforms, at Audius artists receive 90% of their revenue from their music.

In addition, artists can create and distribute their own tokens to fans. Through supporting the artist, fans can receive this token as a loyalty point and use it in return for the special benefits the artist provides. Not stopping there, listeners can even get AUDIO tokens (token of the Audius platform) through listening to music, also known as “listen-to-earn”.

Thus, by eliminating middlemen, web3 music streaming platforms have brought more benefits to not only artists but also music listeners and fans.

The relationship between artists and fans will be further strengthened by the benefits they receive from interacting with each other.

Ending

NFT as well as web3 opens up new opportunities for the music market. The artist will receive more value from his or her own artwork, and will strengthen the relationship between the artist and the fan.

However, we are currently only at the beginning of this change, all current products are only experimental, there will be many failures and improvements but with the rapid pace of innovation by the industry. Blockchain technology and web3 in general, hopefully we will soon be able to see the wide application of NFT music. And from now until then, there will certainly be many great investment opportunities for us, but always remember that the risks that come with it are equally great.


About AntiAntiNFTs Club (AANC)

AntiAntiNFTs Club (AANC) is a community of NFT collectors and investors in Vietnam. Stemming from the love for NFT AANC always wants to spread that love to everyone through building a quality community, a place that is true to our slogan “Can’t help falling in love with” NFTs”.

Join the AANC Community on: Telegram | Twitter

See also previous articles of AANC:

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#NFT #Web3 #change #current #music #market

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