Making a living as a musician is hard. It is estimated that only 0.2 per cent of musicians globally become “successful” while 90.7 per cent remain undiscovered.
The odds are stacked against musicians, but that said, the future of music is brighter than ever with blockchain technology.
Music industry vs musicians
The music industry has been stagnant for decades, and the two major catalysts for change were the various levels of lockdowns across the world and streaming services.
To make a living with music, the bulk of musicians’ income comes from live performance (30 per cent), teaching (18 per cent), salaried playing (12 per cent), composing (11 per cent), session work (10 per cent), sound recordings (7.3 per cent), merchandise (1.9 per cent) and others.
With the pandemic, most of these income channels are down significantly.
Streaming became the only viable way to monetise one’s music. Millions of music lovers can tune in to talented musicians from all over the world who compose music, record songs and get paid for it all in the comfort of their homes.
But the top 3 record labels raked in US$19 million a day from streaming, while eight out of ten music creators earn less than US$200 a year from streaming.
Problems with streaming
All streaming services notoriously underpay content creators.
The largest player in music streaming, Spotify, pays on average US$0.0003 for every stream, and they recently announced that they would lower that even more.
To make the minimum wage of US$20 per hour requires a staggering 67,000 streams per hour.
Just like everyone else, musicians need to pay bills. When live performances and touring were still a thing, they’d be paid in cash after the show. With that option gone, streaming compounds the cash flow problem as their payment terms are 3 to 6 months.
Blockchain, the promising solution
To address the inadequacies of existing streaming services, audio exchange platforms have emerged on the blockchain.
First, there are streaming services that pay US$0.01 to US$0.10 per stream, at least 10 to 40 times more than currently offered by the incumbents.
Second, as the payout is in cryptocurrency, it is instantaneous and can be changed into regular cash (aka fiat).
Third, an additional benefit of being built with smart contracts is that all collaborators on a song will be appropriately accredited and paid fairly.
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Blockchain as an added layer of technology helps solve the fundamental problems that musicians face. The only thing left to do is to get those streams going.
The keyword is community
To get millions of monthly streams overnight is only achievable with the backing of major record labels and their marketing dollars.
The goal of the average independent musician is to organically build a fanbase or community that supports their endeavours. Kevin Kelly famously stated in 2008 that musicians would need 1,000 true fans to make it.
This requires musicians to be proactive, not just to make music and tour but to foster genuine community engagement.
Social media outlets (Facebook, Discord, Reddit) are not just promotional pits to share announcements and sell merchandise. It should be a two-way relationship where you answer the queries of your fans. Lil Nas X’s social media game is an excellent example of how one should invest time and energy to engage fans.
Looking forward to music rights
No matter how you look at it, music is about ownership rights. In the past, music was all about selling records and signing deals, where the record label owned everything.
Nowadays, with streaming services, music rights are shared. Acts like Chance The Rapper, one of the pioneers in being a successful independent musician, is the epitome of what it can be in the present.
Today, the earning split is better, but the lion’s share is still not sitting with the creators. Streaming services are still centralised platforms with complete control.
Hence, the future of music will be one where musicians are fully independent, owning the rights to their creations and how it is distributed, and hence being able to dictate their earnings.
This can be achieved by making songs into Non-Fungible Tokens (NFTs), where the digital file can be kept on the blockchain as a one-of-a-kind collectible item.
For the Gen Z of creators and fans, who are savvier than those who came before them, this could be the one way that they can live their lives making music.
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