After it became known that companies like Spotify pay very little, many singers have opted to release music on NFTs. Also, record labels are being created that are geared exclusively to non-fungible tokens.
Streaming platforms have been known to replace physical and traditional businesses as technologies also continue to grow and develop. Netflix, Disney Plus, HBO Max and many more have appeared as a consequence of technological innovation and advancement for movies, series and TV shows. The well-known VHS or even DVDs have been forgotten after subscriptions to streaming platforms were gaining space nowadays.
The same thing happened and still happens with the music industry, at the time the well-known vinyl records appeared, which can be easily sold in the market, but as collector’s items. Then came the cassettes and later the CDs, all were created as the technologies in relation to music continued to grow and expand around the world.
Currently, we have streaming platforms dedicated to music such as Spotify, Amazon Music Prime, Apple Music, among others. Subscriptions are the most profitable business that these companies have, but nowadays there are more and more artists and users are not growing at the same rate, therefore, payments to musicians are becoming less and less. Spotify pays artists the sum of only 0.002 euros per play, i.e. it takes 500 plays to make only 1 euro.
After these conflicts and minor payments between artists and music platforms, the NFTs or non-fungible tokens industry promises a paradigm shift in the music sector, both for singers and record labels.
Projects and music sites in NFT formats are appearing every day and promise to bridge the gap between artists and fans. The goal is not to show how much money the user has and how much he can buy it for, but to create a community of music lovers and make it possible for users to enjoy and at the same time help their favorite artists and singers.
Audius is one of the platforms with more known artists that are part of this project, among them are: Katy Perry, Steve Aoki, SKRILLEX, rapper NAS and many more. They have their own token called AUDIO with the goal of building and sustaining a digital economy within the platform between artists and fans. It has over 6 million users and songs from over 200,000 artists are shared.
Immortalizer.io is an open platform in which any musician can create their Music NFTs in 6 different chains, and then sell them in their own fully customizable marketplace without any fee. Immortalizer.io is undoubtedly the best platform today to create and sell Music NFTs.
Sound is another NFT music platform for the web3 with the purpose of empowering artists and giving fans the possibility to own the non-fungible tokens of their artists’ favorite songs.
Snoop Dogg, clearly the singer with the most NFT music sales sold, has a total of 775.31 ETH of earnings. The collector with the most songs in his possession is ethventures, with almost 300 digital tracks in his possession. NFTs of Sound songs also serve as a membership pass for the community of users on Discord where exclusive events, interactions and collaborative projects with artists are held every week.
Vezt another project in the non-fungible token ecosystem is presented to the world as the first blockchain-based music rights marketplace. It launched an innovative way to grow the music industry in the NFTs ecosystem and that is with the use of ISO or Initial Offer Songs. It is for artists and songwriters to share a percentage of a song’s royalties with fans and brands for royalty-based funding. Moreover, the ISO includes a particular date and time when the royalties will be available to the public. Just as a ticket sale for an artist can sell out in minutes, an ISO creates that demand for awareness and opportunity for both the user and the singer or band.
Also, record labels are being created directly targeting artists and songs on NFTs.
Among the best known are HumeThe metaverse, a project with the goal of creating meta-stars. The term comes from a universally influential, metaverse-native virtual music artist who exists in both the metaverse and the physical world.
Another of the record labels that were created is Space Yachtthe two founders are Henry Lu and Rami Perlman and they already have a whole community created around Space Yacht, they generated around 30 thousand followers in Twitter where they are in charge of showcasing the next generation in underground music culture with musical NFTs, events and apparel on the web3. They started with Iconography Vol. 1, which was launched on Nifty Gateway. It was closely followed by Iconography Vol. 2 and Volume 3. The collections include animations by Sahir Khan and music by Space Yacht.
We are going through one of the biggest paradigm shifts of all time in the music industry. We have reviewed how formats have changed and the ways in which musicians and labels have innovated over time. There is no doubt that NFTs and web3 will have the potential to create a solid and profitable solution for artists and musicians. On the web2 singers depend on labels, streaming services, touring around the world in order to generate revenue, and above all having to deal with countless middlemen who take a significant proportion of the royalties artists earn.
With NFTs, these artists will be able to make money by selling their songs as non-fungible tokens directly to their fans without the need for intermediaries such as streaming platforms and record labels. In addition, the low barrier to entry into the web music industry3 means that any artist can release music and earn money as a musician without a contract. They will only have to create a community that trusts and likes what they do, what they create and what they convey in their lyrics or melodies.
Finally, regarding traditional record labels, I don’t think they will become extinct, but they will surely have to adapt to the times of innovation and adoption of web3 and NFTs to put artists at the forefront and generate certainty among fans that, for example, royalties are indeed going to the artists. This can be done simply with blockchain technology and smart contracts, as, they have the essence of demonstrating transparency and immutability on the web.
Written by Rodrigo Catalan (TW: @RodrigoCatalanB) for NFT Express.