The music industry is broken. There’s really no other way to put it. By most measurable accounts, the music industry is much worse off than it was just a decade ago. CD sales are down 84% from where they were ten years ago and although streaming numbers are up, digital sales are also down, and
streaming revenue doesn’t seem to be substantial enough yet to support most artists. Of course, the music industry might be a lot smaller than it was in the recent past, but it’s still a huge industry with a lot of money being generated. In fact, music sales in the US alone, when streaming is taken into account, is still over 7 billion dollars a year. Globally, the music business is a 25 billion dollar a year business. Although revenue from CD sales is down dramatically, there is still an enormous amount of music being consumed through new distribution channels. But no matter how you look at the numbers, it’s hard to deny that it’s much more difficult than it was in the not too distant past for
most musicians. Payments and revenue for artists are down, pretty much across the board. Record sales are down and are just a fraction of what they used to be. Licensing sync fees and performance royalties are also down in
most cases. We all know how hard it is to generate substantial revenue from streaming services.
Most of the time, in order for musicians to even have a shot at getting their music heard, they have to make deals with a series of intermediaries, such as record labels, publishers, music libraries and music distributors. These deals are often complex, multifaceted, involving multiple parties, in deals that tend to be
inefficient and painfully slow. It often takes months or years to get fully paid for transactions, if they happen at all.
Take licensing for example, if I license my music in TV today, I won’t receive performance royalties from anywhere between six and nine months from today, assuming all the paperwork is properly filed. Of course between now and then, I’ll still have bills to pay and expenses that I must meet. Collecting money owed
from mechanical royalties and music that is aired on the radio is an equally slow and inefficient process.
This system of getting our music heard and distributed is and “old school” system that’s more than 100 years old. It’s been around since the rise of radio broadcasting in the 1920s. It’s an archaic and increasingly obsolete system that was created long before the advent of the internet which has completely transformed the music industry and how consumers find and consume music.
Listeners Have Never Made It Better – It’s A Utopia For
Music Fans!
Ironically, while it’s probably never been a worse time for music creators, I think it’s fair to say, that it’s never been a better time for music lovers and people who listen to music. While the music creators themselves are struggling more than ever, at the same time, there’s easier access to a wider supply of music than there ever has been for music
fans. For the most part, finding most music is a simple mouse click away. There are a myriad of free or low cost options for consuming music. From Youtube to Vevo, Spotify Or Tidal, Pandora and so on, there’s no shortage of ways to listen to and discover new music. It’s a utopia for music lovers.
The problem is, that while the music industry has been changing and evolving, the money being generated by the new forms of media that distribute music, isn’t substantial enough to
make music a viable career path for most artists. The money that is being generated is also painfully slow to reach the actual music creators. This makes it even harder for musicians who are trying to create sustainable careers in the music business, which is challenging enough even without these obstacles.
How To Make It Better For Music Creators – Enter The Blockchain
This is where blockhain comes in…
One of the possibilities Scott brought up in our conversation was blockchain technology. To be honest, when Scott told me about the Blockchain originally, I was a bit perplexed. I sort of got the concept. I was vaguely familiar with
bitcoin, the cryptocurrency that utilizes blockchain technology to create a digital currency that can be used to buy and sell things online. But even though the idea intrigued me, I didn’t fully grasp the idea and how it could be applied to the music industry.
As I kept hearing more and more about the concept of blockchain technology and its potential application in the music industry, I decided to dive in deep to the subject and really
try and wrap my head around it. I started watching youtube videos about it, I started reading industry articles about the technology and I started talking to people who are working in the business that are proponents of the technology.
One of the things that really excites me about the music industry right now is the fact that it’s so broken. That might sound like a strange thing to say, but think about it, the music industry is in such
a state of profound disrepair that the only direction we can really go is up. All industries evolve and change, and my intuition and sense is that the music industry is ripe for a revolution of sorts. The technology exists right now to solve many of the issues that are plaguing the music industry.
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