This is How Blockchain Can Change The Music Industry
Sweetheart Pubstack #34
We’re Rachel Hurley and Frank Keith IV, co-owners of the Sweetheart Pub. We’re music industry veterans with over 30 years of combined experience in the music business, having worked in licensing, talent buying/booking, label management, tour management, and more. Once a week, we’ll publish a new edition of this newsletter, where we’ll share some philosophy and actionable advice on all facets of the music industry.
We’ve been putting together a weekly playlist of seven songs (just enough to keep your attention) every week — check out The Sweet Spot to hear what we’ve been listening to.
What we’re thinking about this week…
Blockchain and its effect on the music industry
It’s hard to write about cryptocurrency, NFTs (non-fungible tokens), and blockchain technology because people’s knowledge about them varies so widely. It’s tricky to know how much explanation is needed. Too little and the reader can’t follow what you’re discussing; too much and it becomes more about what it is, rather than what it does.
And that’s what people really want to know — “What the hell does it do?”
Most people understand what crypto is by now, but not necessarily the technology that makes it possible or why that technology could completely revolutionize the music industry.
Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on said blockchain. It allows the information to be decentralized — similar to Bittorrent. If you’re not familiar with that, it’s a peer-to-peer file sharing network where you can download files.
What makes it different from a website is that you can’t take it down. Instead of hosting the files on a single server, tiny “bits” of each file (called a torrent) are hosted on the network users’ computers. When you download a file, the network grabs a small portion of the file from many different users and then reassembles the file on your computer. This is also how a blockchain works — and what it enables is peer-to-peer transactions. ($$)
That’s the part that could really shake up the music industry.
Imagine not having to go through Spotify, Apple, or YouTube to deliver music to your fans. The way that could work would be through delivering albums as NFTs with code written within, giving different permissions. It could have royalties written into it so that if anyone ever re-sold an album, part of the money would be diverted to the original creator, it could have certain streaming rights, it would be non-copyable, it could even be restricted from ever being sold again. Each album could hold within it it’s entire history; how many times it has been listened to, who listened, who owns it, who previously owned it, etc, etc.
Blockchain offers up a lot of opportunities for crowdfunding, too. Your fans could purchase NFTs that included a royalty rate to be paid to the purchaser. Instead of having a label, your fans could invest in your music with a promise of a percentage of the sales in perpetuity. They would then be incentivized to share all of your social media posts! You would never have to worry about a company going out of business and not knowing who would be in charge of your royalties (like in the recent situation at Bloodshot Records). Everything is written in the smart contract and can’t be fudged with. You would be able to easily determine how many albums are sold, who owns them, what they were sold for — the entire history of an album could be obtainable within the ledger.
Another idea gaining traction is selling NFT tickets to shows. Those tokens could be resold as collectibles, and again, it could include a smart contract in which the originator receive a portion of those sales. With blockchain technology, the days of “banking hours” will soon be gone. Payments will be instantaneous. Payments for live shows will be released as soon as predetermined obligations are fulfilled within the smart contract. You could even be paid your royalties in real time.
The potential of using blockchain is limitless, and we’ve barely scratched the surface. When I was in high school I never imagined that one day I would carry a pocket sized computer around that would give me access to almost every note of music ever recorded, yet here we are. Who knows where we will be in five years.
S*** You Can Do Today
If you haven’t started using Instagram Reels, you’re really missing out on a hot algorithm.
Looking back through our standard posts versus reels analytics, it’s clear that IG is favoring one over the other with our reels being viewed up to four times more. Using candid video footage rather than a perfectly-curated photo may still seem daunting to some of you, but it’s the kind of “real” content that your fans are craving. Plus, Reels goes out to people who don’t already like your page without you having to create a paid promotion, and you can target your audience by using relevant hashtags.
But don’t take our word for it. Test it out today by creating a Reel and then compare its views after 24 hours with your previous content. If it doesn’t outperform your previous posts, we’ll eat our hat ;)
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Just for Fun
Music Rookie Podcast
Have a follow-up question for one of our guests? Got a tip? Did we (*gasp*) get something wrong? Our line is always open -- hit us up and if we use your question or response in a future newsletter, we’ll give you credit and link your socials.
As we often receive requests to work with artists who don’t have the budget to afford a full campaign, we’re launching an “Office Hours”-style consulting service where you can book us for 30 or 60-minute blocks of one-on-one time.
Thanks for sticking around!
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