The music industry has undergone a massive transformation in recent years. We have seen the advent of the Internet leave its mark on music, and most of all 1999 marked the arrival of Napster. This then revolutionary peer-to-peer online streaming service defined an entire generation and allowed musicians to share their creations with the world.
Streaming has become the dominant music format today, through Apple, Amazon, Tencent Music, and the clear category winner: Spotify. The goal of distribution platforms and services like Spotify is to enable and empower artists to create more without worrying about anything other than honing their craft.
However, that is only on paper: does this utopian ideal reflect reality? Not that much.
Sure, the "transformation" of music in recent decades is evident, but it seems that someone was left behind. And the saddest thing is that those who stayed behind are the same artists who give us goose bumps, make our feet move and bring the widest of smiles to our faces.
The streaming economy is tough. Platforms like Spotify operate under a business model in which the platform operator takes part in each flow. That makes sense as Spotify offers Layout better than nothing, but there is still a big problem. Ultimately, it's about 70% who end up with the music rights holders, and the discovery feature tends to put lesser-known artists at a disadvantage to household names. The result is a very heavy distribution funnel that benefits ready-made musicians.
It's not news yesterday that music is still a pretty damp and dark place for most artists trying to make a living by creating and doing the above. The industry is still plagued by revenue-hogging intermediaries seeking to undermine those who matter most. If you're not like the Taylor Swift, Billie Eilishes, and Justin Biebers of the world, you're likely having a hard time making ends meet. And even if you are like them, you are probably not getting your due either.
On the bright side ... change is coming. No, cross that, change it's here.
Ushering in a new era of music
Non-fungible tokens (NFTs) and the underlying technology are introducing an entirely new ball game and level playing field that will enable and empower artists. What NFTs do is unlock value by making the digital scarcity real and active. At the same time, they allow musicians, designers, and everyone else to exercise. control about their work, effectively making them masters of distribution.
Related: NFTs are a game changer for independent artists and musicians
Do you remember the first NFT you bought? And do you also remember the feeling after buying it? It felt quite remarkable, didn't it? That's another thing about digital collectibles - owning them, stacking them, it's just intoxicating.
Now, imagine if you could support your favorite artist and get his latest hit straight from him. and also get the "NFT boost". Let's say you want to attend a festival full of all your favorite DJs, wouldn't it be an absolute pleasure to be able to get your ticket straight from the source? And how cool would it be to also get a one-of-a-kind, personalized, and one-of-a-kind attendance trial with your own name on there? Now we are talking.
Alright that's great and will soon be ubiquitous, but what's the deal with streaming platforms like Spotify? Big question. I surely have good intentions (at least we hope so) and we have moved the needle in the right direction. However, that is not enough in a world riddled with arbitrary numbers and standardized displays.
Reintroduce scarcity and make music feel unique again
The digital scarcity is necessary to create a unique user experience and allow fans to form more lasting and deeper connections with their favorite artists.
As it stands, there is nothing truly unique about music on Spotify - tracks don't come in limited editions, music connoisseurs can't get their hands on rare album releases, and Spotify lacks a scarcity system. Think about it: if you're a die-hard fan of Canadian DJ and producer Deadmau5, you'll probably want to have the number one release for a given track or album. Or then release # 10, or # 50 - something with a higher intrinsic value that shows your love for a certain artist. Why doesn't that exist?
Such a "tiered" system of music publishing would certainly benefit the artist, as early and limited editions carry a higher value. At the same time, it also allows fans to grow together with the artist. Take that # 1 release from a Deadmau5 track you own as an example. By the time the track enters, say, the Weekly Top 10, others will see your name right next to it; that way, fans can get a slice of the "fame" cake.
At some point and for whatever reason, it might make sense for a fan to sell that number one NFT release. Would you mind guessing who would get a cut of that sale? Correct - the artist.
Related: Celebrities are embracing NFTs in a big way
Direct one-on-one interaction, a margin of influence for fans, a greater sense of belonging, and deeper connections - that's one reason, or rather three reasons, why NFTs are on their way to causing their fair share of shaking. at the next Spotify Shareholders' Meeting. The other? Enable and empower artists and put them back in the driver's seat.
A new era of the creative economy
You see, music streaming platforms took value away from musicians by standardizing everything, and the value of digitization of the last few decades largely created an environment that limits the artist's control over distribution. With NFTs, this control is back in place - you can program and track anything and do whatever you want with your music if its initial release to the world uses NFT technology.
Oh, and now you can also give your fans a piece of the pie by introducing other creative twists like revenue sharing. The more popular the artist, the happier the fan - everyone wins. Combine that with the ideas outlined above, and we have a recipe for success. Who would have thought that was possible?
Related: Bull or bear market, creators are diving head first into cryptocurrencies
We are entering a new era of the creator economy, and NFTs are the next logical step to further enable and empower artists. The time has come to reintroduce scarcity into an industry built on uniqueness and leave the driver's seat free for those who are best prepared to take the road ahead.
Put aside Spotify; NFTs are coming.
This article does not contain investment advice or recommendations. Every trade and investment move involves risk, and readers should do their own research when making a decision.
The views, thoughts, and opinions expressed here are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Joan Westenberg is a Web 3.0 writer, angel investor, and creative director. He founded a technology communications and public relations company called Studio Self and is part of the MODA DAO team. His writing has been published in The SF Chronicle, Wired, The AFR, The Observer, ABC, Junkee, SBS, Crikey and over 40 publications and his regular work can be found on Pizza Party, sharing notes on Web 3.0, Metaverse and NFT .
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