How does NFT empower the music industry?

Some of you may have heard of Kings of Leon, founded in the late 1990s and popular at the turn of the century. And in the twenty-first year of this century, they are once again being remembered – from an emerging concept, NFT.

How does NFT empower the music industry?

In March, Kings of Leon joined forces with YellowHeart to release an NFT music album, the first in the entire music industry to be released as an NFT, a move that facilitated a revolutionary journey in the music industry and the application of blockchain technology.

A brief overview of the development of the NFT music industry

As digital trends continue to dominate the traditional industry, platforms such as Spotify and Soundcloud have created new channels for musicians to monetize their music and increase exposure. Then, NFT offered a similar solution through blockchain technology, allowing musicians to attract fans and earn more revenue in a whole new way.

Musicoin was one of the first projects to cater to the new developments in the music industry, offering a free platform that allowed artists to be rewarded directly by their fans. new platforms such as Rarible, Nifty Gateway, and OpenSea cornered the market and created the NFT frenzy, and these platforms also offered a wide range of NFT products in a wide range of formats.

Since late 2020, NFT has taken the music industry by storm. With the epidemic putting many gigs on hold, musicians are increasingly desperate to earn more royalties from streaming services. This is where non-homogenized tokens come into play, and NFT offers new opportunities to monetize music by marketing the singularity of the record.

The NFT music market is expanding as demand increases and new projects are developed. The blockchain can authorize musicians to hold their music or videos through private keys, and through NFT distribution, buyers will be entitled to their unique copies.

In December 2020, Deadmau5 became the first major player in the industry to go the NFT route, auctioning off a collection called “Rarez”. The collection did not include musical pieces, but did include artwork, stickers and other fun objects. Later that month, he again sold a single copy of In Titan’s Light for a whopping $80,000.

Electronic record label Monstercat soon joined in, selling the Varien-produced soundtrack for over $500,000, and Linkin Park frontman Mike Shinoda sold a 37-second audio clip of “One Hundredth Stream” for $30,000. Shawn Mendes has not released any NFT music, but has made over $600,000 from the sale of other collectibles.

Dance duo Disclosure performed their new song N.F.T-N.R.G on Twitch and the NFT version quickly sold for a profit of about $69,000. Famous electronic producer 3LAU made $11.6 million after selling 33 NFT titles.

Finally, Kings of Leon, the first major hit band to sell an entire album in NFT form, has already sold over $2 million and will continue to soar for the foreseeable future.

NFT won’t solve the livelihood problems all artists have faced or are facing during the epidemic, but it still gives them new opportunities.

NFT + Music Industry Growth Potential

It is well known that in the art world, non-homogenized tokens have been making huge waves. And in the music industry, the NFT hurricane effect is right on schedule. data collected by Water & Music shows that in February 2021 alone, NFT music industry earnings have reached nearly $22 million.

One of the best ways to understand the NFT music industry is to follow some of the key early players that have emerged in the space and are leading the way as music NFTs expand rapidly. water & music statistics show that music NFT sales have increased 150 times in the last six months or so. It seems that every musician and music company is trying to get in on the action.

Music NFT can take many forms, including but not limited to concert (virtual and physical) ticket sales, sample packs, unreleased song previews, artwork and more. As music NFT continues to grow, the potential uses of the technology will rapidly expand far beyond how NFT is used today.

Why buy NFT versions of music?

The When You See Yourself album has been released on streaming platforms such as Spotify, Apple Music, and has been released on QQ Music, and YellowHeart (a blockchain-based streaming platform) offers an NFT version of the album.

Many people will ask why they need to buy the NFT version when they can find the audio source on traditional platforms.

The novelty effect

For some, there is no doubt that NFT is novel and cool, with the $50 package offering electronic album download access in addition to a limited-edition physical version of the Goldeneye vinyl and a one-of-a-kind NFT album collectible. NFT’s underlying blockchain technology allows for the transfer of golden tickets directly to fans’ digital wallets, and the NFT Yourself series also features an auction of six “golden tickets” that will give fans lifetime access to the first four rows of their concerts. .

NFT albums are still a relatively new concept in the music industry, and for those unfamiliar with the NFT industry, it’s a lot like explaining the Internet to people who never saw it in the 90s. By purchasing NFT releases from their favorite musicians, they could in a way understand this emerging concept in the most direct way possible.

Limited and Rare

NFTs, “non-homogenized tokens”, are often limited or unique, which is the key to the fan economy – they come from idols and are limited and precious. Most musicians will release songs or albums in a limited format, creating unique, saleable digital goods, artwork, and a unique musical experience for fans.

While NFT is a digital commodity, the underlying logic of buying NFT is actually similar to buying physical goods. For example, even though an album can be played online for free or for a small fee, many fans will still want to buy limited edition vinyl.

The popularity of NFT has something in common with brands that are driven by marketing. supreme t-shirts are nothing special, but still very special because they are only available to a select few. supreme’s limited release, collector’s limited vinyl, and the scarcity of NFT make them a status symbol and a souvenir.

It’s not unheard of to pay outrageous prices for rare and exclusive music. Former pharmaceutical company CEO Martin Shkreli spent $2 million for the Wu-Tang Clan’s only album, Once Upon A Time In Shaolin. An obscure single by British DJ Scaramanga Silk recently became the most expensive vinyl record on Discogs, selling for over $40,000.

Unique Rights

Some musicians are using NFT to give their supporters an experience like no other, including front row tickets, personal memorabilia and more – all in all, a rich and unique experiment. So the next time you buy an NFT from a musician, remember that you’re buying something unique.

Investment Purpose

Some people may purchase NFT assets for investment purposes, hoping that their NFT holdings will preserve or appreciate in value in the future and that they can profit from resale. the volatility and uncertainty of NFT makes NFT holdings somewhat riskier than some traditional investments, but for many investors, they are willing to take that risk.

As mentioned above, NFT can be viewed simply as a “digital asset + authentication certificate” hybrid, and holds great promise for any use case that connects real-world NFT. Because NFTs can be authenticated and are extremely secure, musicians can better retain fans, create new ways to interact, and not only gain more royalty revenue, but also reduce the traditional inherent costs. Simply put, NFT+Music is really about connecting music – songs, albums, etc. – to NFT.

How does NFT empower the music industry?

How does NFT empower musicians?

For musicians, NFT offers the exciting possibility of removing some of the industry’s middlemen and third parties and tokenizing their work in a whole new way. For example, Linkin Park co-founder Mike Shinoda once auctioned off a 37-second trailer for an unreleased song, complete with audiovisual NFT animation, for a whopping ¥30,000.

The point is that the full version of the song is about to be sold to the leading DSP entertainment company, and most musicians are unlikely to earn anywhere near $10,000 after the DSP and record label take plus marketing costs. For most musicians, company managers, record labels, publishers, etc. make far more money from their music than the musicians, leaving them with only a small percentage.

While electronic artists were the first to join the NFT music industry, such as top earners 3LAU, Deadmau5 and others, musicians of all genres are joining the burgeoning industry, including Kings of Leon.

This also opens up new possibilities for musicians. Grammy-nominated musician Illmind recently released the world’s first beat sampling package in the form of NFT. Anyone can listen to it, but ownership and access goes only to the highest bidder. This sales model could have a major impact on the way music is licensed and sold.

Currently, licensing and transferring ownership of music is a fairly cumbersome process for record labels, publishers and their lawyers, and manually clearing samples for use or transferring ownership can even delay the release date of the music. But using NFT makes licensing and transferring music as easy and fast as shopping online, with efficient and secure document transfer.

Josh Katz, CEO and founder of YellowHeart, has said, “YellowHeart’s mission is to create a symbiotic relationship between artists and fans, empowering them to sell their music productions and tickets directly to fans.”

“Through NFT and smart contract technology, we are changing the way fans interact with artists. We are excited to partner with Kings of Leon to pioneer a transparent, fan-friendly experience that ultimately puts control back in the hands of the artist and the fan.”

As the music industry has been hit hard by the New Crown virus epidemic, there is growing recognition that NFT can be a new way to reduce piracy of digital works and help generate revenue for artists.

How can NFT empower music companies?

Andrew Gertler, manager of Shawn Mendes, has become one of the industry leaders by partnering with creative direction agency STRODY to launch a new NFT music marketplace called STRODY.Exchange. Previously, Gertler and Mendes had also ventured into the NFT marketplace, selling exclusive accessories such as Mendes’ digital signature guitars with Fender.

How does NFT empower the music industry?

Creative studio, record label, and management company IAMSOUND partnered with record label 88Rising and Zora to present the first NFT art exhibition in February 2021 with Toro y Moi, Yaeji, and Mura Masa. One of the best-selling artworks, Yaeji’s digital pet fish sold for the equivalent of $27,000.

Warner Music Group has also been a supporter of NFT for years. in September 2019, long before the NFT music hype began, Warner’s Innovation and Emerging Technologies division invested in Vancouver-based Dapper Labs – the founders of CryptoKitties. Cryptokitties, a game that allows users to trade and sell virtual cats, the first non-homogenized token gaming project. A year later, the two companies also partnered with Muse, a rock band signed to Warner, to launch two limited edition NFTs inspired by the band.

How does NFT empower the music industry?

NFT Music Platforms

If the above introduction has given you a basic understanding of the NFT music industry, then Sophia (ID: lovebit98) will take a look at two relatively famous NFT music platforms – ROCKI and Audius – to help you further understand how NFT music platforms can empower fans and musicians.

ROCKI

ROCKI, a digital music streaming service and payment network, is the largest music platform on the Coin Smartchain and aims to reward artists directly through its in-app native token $ROCKS. The platform operates on a hybrid user-centric model where artists can receive cryptocurrency as a reward. Notably, ROCKI is the first platform to reward both artists and listeners for their participation.

How does NFT empower the music industry?

ROCKI has launched two unique music NFTs on the ROCKI platform – the ERC721 “Royalty Income Rights” NFT and the ERC1155 “Exclusive Listening Rights” NFT. “Its unique hybrid subscription model allows musicians to earn streaming revenue in monetary terms. The subscriber-centric payment model, often referred to as the fairest payment model for online streaming, has gained widespread media attention, driven by French streaming giant Deezer.

How does NFT empower the music industry?

ROCKI opens up new revenue streams for artists, while bringing new fan engagement and value. Exclusive listening privileges for music NFT releases and royalty income rights for music NFTs on ROCKI are the next step in ROCKI’s development.

On ROCKI, musicians, regardless of their initial audience size, can leverage their existing fan base by introducing Music NFT and a unique payment model that allows musicians to have revenue available even during uncertain times when the epidemic is still raging.

In addition, ROCKI expands the definition of “fan-centric” by rewarding listeners with ROCKS tokens on the ROCKI platform for listening to sponsored and curated music. In a precedent-setting move, listeners can earn ROCKS tokens for creating playlists, providing feedback, and hosting social events on the streaming platform.

ROCKI is trying to solve the following problems:

  • Cut out middlemen and third parties, allowing fans and artists to build relationships directly
  • Working with artists who completely own their music, i.e. independent artists, which is by far the fastest growing category of musicians.
  • Leverage the power of blockchain to handle operations: transparency, security, contracts without trust, finance.
  • Pay streaming royalties with a hybrid model and share most of the subscription revenue with the musicians.
  • Reward listeners and attract more users to participate.

Meanwhile, the company successfully auctioned off royalties from Israeli progressive house DJ Guy J’s song COTTON EYES through Bounce.finance, which sold for a record price of 40 ETH.

Guy J Cotton Eyes

The new exclusive track was sold for a record 40 Ether (about $24,880 at the time of writing), with the right to earn 50% of the future ERC721 royalties from the work, via the decentralized auction protocol Bounce.finance.

The platform’s native token, ROCKI, provides rewards to musicians and listeners for early participation, and the token’s features also encourage token holders to use it not as a speculative asset, but to explore useful features on the platform. ROCKI also awards tokens to individuals and collectives who are able to help make the platform work. In addition, ROCKI tokens are designed to build an active and positive community and are an important part of the platform’s development.

The platform provides a much-needed source of income for artists and musicians who have been hit by the new crown epidemic. Although the platform is still only available in beta, as of December 2020, it already has thousands of independent artists and over 30,000 tracks.

Audius

How does NFT empower the music industry?

Audius is a decentralized streaming platform that runs on multiple nodes to ensure that the music is entirely owned by the artists themselves. With over 3 million monthly users, the platform is designed to replace Spotify and SoundCloud, and opens up new possibilities: incorporating its own NFT library into the network.

The platform describes itself as “the cornerstone of the creator economy” and a hub for artist/fan interaction. The platform also enables the Audius passport, which allows users to connect to the Web 3.0 ecosystem. The network requires no permissions. As a result, creators are able to tap into an entire library of existing music to present new works with a new look and feel. In addition, network participants can run nodes, make contributions and receive rewards.

Unlike ROCKI, Audius does not sell NFTs, but rather introduces a “collectibles” feature that allows participating artists and a certain level of users (both musicians and users must hold at least 100 Audio tokens – about $240 as of this writing). -(approximately $240 at the time of this writing) to have a Silver Tier account and be eligible to use the Collectibles feature. This is a great opportunity for musicians to market and sell their NFT collections, and for users to discover and purchase digital items they like.

The Collections feature sounds a lot like Lazy.com’s NFT gallery, but Audius features an embedded dedicated music site. Only on a music-centric basis Audius can also be used to showcase a variety of NFTs. Audius is currently compatible with SuperRare, OpenSea, Zora, Rarible, Foundation, Catalog and KnownOrigin’s NFTs and is expected to have cooperation.

Audius allows musicians to distribute to fans and receive direct revenue, featuring

  1. an efficient token economy driven by Audius platform tokens ($AUDIO), third-party stable coins and artist tokens
  2. decentralized storage solution and ledger accounts for sharing audio and metadata.
  3. programmable mechanism. 4.
  4. Discovery protocol for users to efficiently query metadata.
  5. a decentralized management protocol where artists, node operators and fans can all have either individual or collective rights in decisions about platform changes and upgrades.

The Audius platform can also recommend popular songs based on users’ likes, follows and retweets, and players can get new tweets by refreshing. An APP version of the platform is also available. At the time of writing, the platform’s #1 hit, Boss Up Remix, has already received 4k+ plays and many likes and retweets for its catchy melody.

Audius’ native token, $AUDIO, increases network security, brings exclusive feature access, and promotes autonomous community governance. the Audius protocol gives each user the freedom to share, monetize, and listen to audio. Users who hold $AUDIO can earn a voice and participate in decisions about the future direction of the platform by making active contributions to the network.

NFT’s Enabling Solutions for the Music Industry

Intellectual Property

It is well known that digital media can be copied, shared and stolen: seed downloads and audio leaks undoubtedly cut into the profits of the entire music industry, threatening traditional distribution and monetization models. By investing in NFT, music industry creators, curators, gallerists and other stakeholders are attempting to create and capture the value of “digital scarcity”. The value of an NFT song is not necessarily just its sound, but allows consumers to have unique ownership of the song file, transferring ownership directly from the artist themselves to the buyer via the ethereum blockchain.

For the superfans, that share of glory, bragging rights and bragging rights may be enough to make it captivating; and for those hundreds of speculators flooding the NFT market, pushing up the price of NFT assets, such as GIFs and JPEGs, they hope that the novelty of NFT music media will continue to accumulate value in the secondary market over time, allowing them to make more profit through resale.

As evidenced by the successful sale of Illmind sample packs, NFT can transfer ownership of intellectual property such as songs, recordings and samples more easily, quickly and securely than is currently the case. The transfer of ownership via blockchain can be recorded through “smart contracts” and processed in seconds.

Additional revenue streams for musicians

The music industry has been hit hard by the new crown virus. NFT offers a potential new form of revenue that could make up for this loss and also provide fans with the opportunity to support artists directly.

Since streaming platforms like Spotify typically allocate 90 percent of royalties to barely 2 percent of musicians, most independent musicians receive little to no revenue. And according to a comprehensive Citigroup report on the music industry, only 12 percent of all music industry revenue ends up in the hands of original musicians. So, in time, NFT Music will become the model of choice for independent musicians of all genres.

In the best case scenario, musicians can easily profit from the secondary market and earn a predetermined share of profits from the resale of future digital music productions. In theory, it also encourages investors to seek out talent not yet in the music business, investing in promising music creators like stocks and realizing cash when they gain popularity.

Convenience and flexibility

One of the most important features of NFT is its convenience. Fans simply need to create a digital wallet to access and receive content, participate in auctions, and have a chance to win contenders. This makes buying exclusive music productions as easy as shopping online. Musicians also simply register to upload their work, set entries such as willingness prices, and wait for buyers to auction it off.

In addition, artists have a lot of flexibility in what they want to auction, which can be digital but can also be physical. Albums, digital works, sound clips, merchandise and concert tickets are all forms of non-homogenized tokens that musicians can post. Fans are happy to pay for this new and exciting experience, and musicians can naturally “sit back and enjoy” it.

Secure and decentralized

Digital transactions are secure and instant, with no middlemen, and NFT links musicians and fans directly. But instead of digital currency, musicians exchange NFTs for concert tickets, limited edition experiences, digital content, merchandise and music. Fans participate in auctions for these tokens, and the highest bidders are deposited directly into digital wallets through secure transactions.

In these exchanges, which do not involve third-party record labels, musicians can raise funds for the content they auction and keep all of it. Fans spend money to acquire unique content, the proceeds are securely stored in their digital wallets, and the auction funds can virtually go to the musicians.

Additionally, the in-blockchain encoding of makes the NFT music industry persistent, existing outside of any media platform. Once a file is encoded as NFT, it is very difficult to steal or perform other irregularities. As long as the blockchain is functioning properly, NFT music will last virtually forever.

Creators are not subject to the ever-changing distractions of Spotify, YouTube, and other platforms, and creators can allow the original creation to reach its full value and sell it to fans who cherish and value originality with guaranteed distribution.

Ticketed Events

Ticketing for live and virtual events has long faced many dilemmas: inefficiencies, robo-programming, scalpers, hidden fees, counterfeit tickets, and more. According to CNBC, 12 percent of people who buy concert tickets have experienced fraud. But NFT, powered by blockchain, minimizes the potential for fraud, makes ownership transfer records visible, and ticket verification easy. If ticketing companies prohibit resale and scalping, Smart Ticketing can encode non-transferable information in its computer code to prevent ticket transfers.

Future Challenges

Emerging Musicians

The demand for NFT music tokens in the marketplace often comes from the demand for a specific musician’s work. Popular or established musicians can effortlessly attract fans and participate in the bidding. But for emerging artists, this demand takes a lot of time and effort to create. New artists do not have as much opportunity to benefit from this new form of music.

To date, the number of emerging artists entering the NFT market remains small. sales in NFT are often driven by status and hype, not by level, so it is understandable that emerging artists have not exploded in popularity. In addition, many markets intentionally shut out lesser-known artists. openSea.io, the most mainstream NFT exchange, and other marketplaces open to emerging NFT music often charge high upfront fees for casting or releasing work, raising the barriers to entry.

Creating Scarcity

NFT can inspire new art forms, but if the value of art is purely its scarcity, then limited distribution and artist access is paramount.

Digital scarcity is very different from physical scarcity. Limited seating is an example of scarcity in live performance, a limitation imposed by physical conditions, but the number of tickets sold for NFT live shows also needs to create scarcity, and the number of tickets sold can be determined by the artist. nft relies on an artificial concept: make something that is not scarce scarce, and value will naturally follow. But too high a price may also create a sense of exclusion and turn many fans away. The decision on the level of scarcity still needs to depend on the scale.

Bubble

Will this be a new bubble? Are we overestimating anything because of NFT’s current hotness? If the price of selling NFT is based on hype and scarcity, then the risk to those who buy NFT as an investment product is immeasurable once people’s interest drops.

It can cost hundreds of dollars to own a song or album with an NFT label, and NFT music items are no longer simply music or MP3s, but have entered more of a collector’s item category, often selling for much higher prices. In addition, there are musicians who are creating copies of their work that have NFT tags. In theory, it does make each piece unique, but its value can also be greatly diminished in the real world. If, as a collector, you want to purchase an asset that will preserve and increase in value in the future, try buying pieces that are truly unique, not just copies with the NFT label attached.

Intellectual Property

While Illmind’s sampler pack NFT could demonstrate the potential benefits of using the blockchain to transfer ownership of intellectual property, there is still a lot of uncertainty involved. Given the technology’s recent introduction and the extreme complexity of global copyright law, smart contracts in decentralized systems are likely to encounter problems that will need to be discovered and resolved along the way.

Sale Model

NFTs can be sold in the marketplace. The vast majority of music NFTs are sold using an auction model, but some are sold at a fixed price. Which method takes precedence depends on the seller’s wishes. Most marketplaces do not accept payment by credit card or traditional cash, which somewhat discourages many fans from entering.

But if you really want to buy NFT, the best way is to follow the tweets of your favorite musicians closely. Most auction news for musical works is tweeted in advance.

Environmental issues

Currently, writing new transactions for the ethereum blockchain is extremely energy inefficient. To ensure the security and fidelity of the blockchain, large computer networks are scrambling to be the first to come up with complex algorithmic solutions that add new transactions, new “blocks” to the blockchain. These current “proof-of-work” processes place a premium on unilateral efforts, resulting in a lack of interoperability between servers.

In 2018 alone, Ether used as much energy to verify its blockchain as the entire country of Iceland. While engineers are working on a new consensus algorithm, it is designed to reward Ether’s investors rather than aim to increase computing power, an upgrade that is likely to take at least another year. For example, buying a concert video could consume the amount of energy needed to power an entire community.

The future is here

As more and more companies recognize the value of the NFT music industry, this emerging market is gradually beginning to gain recognition. Most recently, Catalog is building a business model similar to Bandcamp, where artists can upload, collect and trade unique digital entries. As the company emphasizes, NFTs in the marketplace will be certified and endorsed by the artists themselves. The value of Catalog is that it creates a 1-to-1 entry marketplace based on uniformity and scarcity.

In addition, XLR8R, an established electronic music publishing company, mentioned the development of its NFT market. Meanwhile, TUNE.FM will also launch its own marketplace. More marketplaces, such as STURDY.exchange, mentioned above, are currently under construction. Each marketplace has its own value proposition to help artists connect with fans and easily monetize their intellectual property.

If you are a musician trying to break into the NFT industry, you can design limited and meaningful NFTs so that backers are buying authentic and unique items. Not only will this add more value to them, but it will also build an intimate and trusting relationship between the two parties.

How does NFT empower the music industry?

In short, NFT will be disruptive to musicians and to the music industry. It gives musicians more control and decision making power, and can provide them with a new revenue stream, which is especially important today when the epidemic is not over. At the same time, it gives fans the opportunity to enjoy the thrill of owning their loved ones’ global singles and allows more fans closer access to musicians, as well as safer, more secure access to verifiable NFT assets.

There is no denying that the emerging NFT music industry is facing many problems, and it remains to be seen whether this is a collective mindless orgy. Whether this will reshape the way musicians and fans interact remains to be seen. But we can think about what else music can be linked to besides NFT, like music + DAO, like …… Join our community and let’s discuss!

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/how-does-nft-empower-the-music-industry/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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