What is blockchain? How will it affect industries throughout the world? Blockchain is a system that shares information between many computers, also called nodes. Because the information stored in the blockchain is decentralized, blockchain allows information to be stored securely and immutably. Blockchain has many useful applications. However, there is an industry that blockchain will transform completely in the next few years: the music industry. Blockchain will revolutionize the music industry in the next 3-5 years by automating transactions through smart contracts, preserving authorship information, and reducing transactional fees. rnSmart Contracts rnBlockchain’s smart contracts can empower artists by distributing revenue to artists more efficiently. The article, “Blockchain Could Help Musicians Make Money Again” explains how blockchain can enable events, such as a person listening to a song, to automatically activate a sequence of actions. It explains, “For example, listening to a song might automatically trigger an agreement for everyone involved in the journey of a song with anyone who wants to interact or do business with it — whether that’s a fan, a DSP (digital service provider such as
Spotify or iTunes), a radio station, or a film production crew” (Heap). This shows that blockchain allows companies to automatically trigger actions, such as agreements, whenever a person listens to a song. For example, blockchain can distribute song’s profits automatically. The article “The Networked Record Industry: How Blockchain Technology Could Transform the Consumption and Monetisation of Recorded Music” supports this. It states, “Smart contracts could allow revenue from a stream or download to be distributed automatically between rights holders, almost at the moment the track is downloaded” (O’Dair 19). By automatically sharing profits, blockchain’s smart contracts can deliver profits to musicians quickly. However, there is a more important way that blockchain will revolutionize the music industry: by protecting authorship information. rnAuthorship Information rnMore importantly, blockchain can help protect authorship information. One of the most significant concerns with the music industry is that people can plagiarize songs and expunge their authorship information. Consequently, people may never give credit to the original musician for their work. Fortunately, blockchain can solve this problem by making information immutable. The article, “Here’s How You Can Secure Your Data with Blockchain” explains, “Because of its decentralized nature, you can always cross check file signatures across all the ledgers on all the nodes in the network and verify that they haven’t been changed” (Palavesh). Because the information in the blockchain is spread across different “nodes,” or computers, malicious parties cannot alter information in the blockchain. This feature allows blockchain to protect songs’ authorship information effectively. rnBecause
blockchain is decentralized and can make information immutable, artists can use blockchain to permanently fuse authorship information in their songs. The article “How blockchain can change the music industry” explains, “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” (Dickson). This shows that malicious users cannot remove authorship information from songs. Therefore, blockchain is an effective way to ensure authors receive credit for their songs. By fusing authorship information with songs in the blockchain, musicians can receive credit for their works. rnSome companies are preparing to use blockchain in the music industry. For example, Open Music Initiative is constructing a system to track songs’ authors. It explains, “Open Music’s efforts -- led by
music industry and technology industry deep subject matter experts who also represent value chain-wide participation -- will add tremendous insights in the development of a new system for managing mechanical rights”; (“Our Open Protocols Approach”). Using blockchain, Open Music Initiative is developing a system to track song rights, which will help authors protect their works. Open Music Initiative is an example of a company using blockchain in the music industry. rnTransactional Fees rnMost importantly, blockchain can help reduce transactional fees, helping musicians profit. For example, Bitcoin is a payment method based on blockchain. Bitcoin’s website explains that it does not have a “…middle man to manage the exchange of funds” (“Bitcoin for Beginners”). By removing the “middle man,” musicians can reduce transactional fees and earn more profits. O’Dair acknowledges this benefit. He wrote that one of blockchain’s benefits was “…a significant reduction in administration and transactional costs, linked to the low transaction costs of digital currencies (Grinberg 2011, p170; Brito and Castillo 2013, p10) and particularly important given the small size of typical payments in the streaming era” (19). This shows that musicians gain profits in the form of small transactions, which are significantly affected by transactional fees. Since blockchain reduces transaction fees, it significantly increases musicians’ profit margins. By removing intermediate parties and reducing transactional fees, blockchain helps musicians gain more profits.rnBlockchain will revolutionize the
music industry in the next 3-5 years for three main reasons. First, blockchain’s
smart contracts allow for automation, which allows them to automatically deliver profits to musicians. Second, blockchain protects authorship information in songs. By incorporating immutable authorship information into their songs, musicians can prevent malicious parties from plagiarizing their songs. Most importantly, blockchain reduces songs’ transactional fees. Blockchain prevents some third-parties from charging transactional fees, which helps musicians to earn more profits. Blockchain will revolutionize music by automating transactions, protecting authorship information, and reducing transactional fees for songs. What do you think about these changes? Do you think these changes will have a positive impact on the music industry?