There’s a lot of excitement within the music industry about the potential for blockchain technology, from Benji Rogers’ Dot Blockchain Music, to experiments like Imogen Heap’s Mycelia, and emerging startups like Jaak, Stem, Paperchain, Superational, Ujo Music and others.
However, there are also sceptics who question whether blockchain technology can have the impact on the recorded-music ecosystem that has been claimed. One of them is Kevin Bacon, the musician and producer who also co-founded independent distributor AWAL and ran analytics platform BuzzDeck, and has advised a range of music and tech companies.
At the NY:LON Connect conference we organised with the Music Business Association this week, Bacon beamed in with a short speech outlining his views on blockchain technology, and why it may not be the saviour for the music industry after all. Here’s a full transcript of his address:
“I think we’ve all been exposed to some element of blockchain over the last year or so, whether it be Imogen’s project, or Benji, or many of the other news items and reports across the BBC etc which talk about how potentially blockchain could save the music industry, the record industry.
Well, I don’t think that’s going to happen. First of all we’d have to describe what ‘fixing’ is. And if fixing is making instant payments to everybody in a clear, transparent and accurate manner within minutes of a purchase or a stream, then I think we’re in for a long wait for that one.
Even if it was technically possible – which at the moment there isn’t really a platform out there big enough to support the strain that it would cause, but you would have to look at two to three to four hundred DSPs changing their ingestion system to import data which supports the blockchain format, the blockchain delivery.
We’d have to look at everybody writing their payment / analytics outputs. That alone would be a phenomenally huge cost. Every record company, every delivery company, every aggregator would have to rewrite their delivery systems and their data ingestions to make it all work.
Every PRO to make it work, every publisher, and all the way down the chain. We’d have to go all the way down to people being happy to be paid cryptocurrency within minutes of their stream into their e-wallet, or wait a month or three months or six months or whatever to get something in pounds, or their chosen currency.
It’s a big ask, it’s a massive expense. We’ve got to look at who benefits. And this is where the ‘why’ comes in to it.
Who benefits? The DSPs don’t benefit. I suppose in the end it doesn’t really matter to them too much about when they pay people. They’d probably be happier paying people faster. But to be honest, I don’t think they could pay anybody faster than what they do now. Or certainly report to people faster.
The record companies? Well, the interesting thing about record companies is do they really want to pay people faster? And do they really want to be open about their NDAs with service providers? Historically I would say that’s a big ask.
Publishers? Similar thing. But in the middle of all that, PROs? I think PROs will be happy partakers in a system whereby money could be distributed much faster. But without everybody on board, it’s not going to happen.
At the moment we’ve got a music industry that could do so much more with the Excel spreadsheet and the piece of paper, without having to get round to using blockchain technology. And yet that still doesn’t happen.
Am I negative about blockchain? Well, who’s going to benefit? If we implemented it from top to bottom: DSPs, no benefit. Labels would hate it. Publishers would hate it. PROs would probably love it.
Big artists wouldn’t give a shit. Their accountants would hate it. The idea of receiving data daily and money on shorter periods would be an accounting nightmare and would be phenomenally more expensive.
Who benefits? In the end, sadly you have to say it, a number of smaller artists who would love to get paid. There is a marketing aspect of the data going through a lot faster. But we’re nearly there now with usage data anyway.
If this whole thing doesn’t actually pay anybody, then what’s the point of it? Am I negative about blockchain? No. I think it’s great. I can see some particularly powerful applications around PROs and around some other issues that need solving, for which blockchain would be perfect.
But blockchain saving the record industry? I don’t see it.”
Music Ally is a broad church as far as the blockchain goes: if you’d like to respond to Kevin’s views with your own guest post, email email@example.com.
The NY:LON Connect conference was co-organised by Music Ally and the Music Business Association, in association with Armonia.