As the way in which consumers discover and enjoy music evolves with developing technologies, creators and rightsholders will increasingly have the opportunity to make their music available to listeners on their own terms, writes Benji Rogers Founder of dotBlockChain Media and Pledgemusic.
SONGS AS SKILLS
“Alexa, please play the Moana soundtrack.”
That’s how my five-year-old daughter makes music play in our house (and yes, she says please).
Alexa then replies, “Now playing the soundtrack to the motion picture Moana by various artists on Spotify.”
Some version of this daily ritual is becoming more prevalent in households all over the world as voice control has become easier to use, and as Amazon, Google, and now Apple, march into the home.
WHAT FEEDS THE MACHINE?
Twenty four years ago the music industry was blessed, or cursed depending on your point of view, with a digital music format called the MP3 (the WAV file format was introduced two years earlier). From that moment on music became files, and files go everywhere.
As I have previously written there are many cool things about files. They can be altered, amended, deleted, copied, uploaded and downloaded, and most importantly for this post, shared.
To put this in terms of musical or creative works: every time a creator makes something and places it into this twenty sixy-year-old medium they are creating something that can be altered, amended, deleted, copied, uploaded and downloaded, and again, shared.
So let’s assume for a moment that this is a good thing, and take a look at how artists monetize these artifacts today.
Sometimes artists sell or offer these files for free directly to fans using their own websites or platforms like PledgeMusic, BandCamp, and others. They also still put them, amazingly, onto CDs, vinyl, and yes, even cassettes and USB drives. But the vast majority of music made today is offered in exchange for monetization or for free through a series of massive third-party platforms like SoundCloud, YouTube, Spotify, AppleMusic, and others that control an artist’s data and set rates and processes for how artists can get paid that are, for the average artist, non-negotiable.
There’s nothing wrong with this of course, but here’s where it gets a little tricky. A song, or songs (in the case of remixes or mashups), once recorded have multiple parties, all of whom are technically owed money when the work is used or exploited in certain ways. This includes the musicians themselves, songwriters, record labels, publishers, engineers, producers, etc. Some songs may have 10–20 collaborators on the writer’s side alone, and some remixes or mashups will have 30 songs in them. All of this adds up to a mess when trying to pay the right people the right amount.
Here’s the kicker: the song files themselves contain nothing really usable beyond the music itself to identify anyone within them or anything about them. They are just dumb files. This Clinton-era technology that we use to deliver our musical works to some of the most advanced digital technology companies on the planet can’t even be relied upon to carry the correct name of the song or the artist, let alone all the other information needed to account for all who are a part of the music itself.
This means that an artist’s financial well being is totally controlled by a huge number of middle men whose job it has now become to figure out what these songs are, who they should pay, take a piece of the pie for their trouble, and pass on the leftovers from a foggy picture at best to whomever they think is entitled to the money.
I would argue that the majority of these services have no idea which songs they are actually looking at since most of the registration processes that artists use to get their works into the digital world don’t store a musical copy of the song in order to identify the works that they are supposed to pay out on in the first place.
Add to this that if they get it wrong, the artist and their collaborators then require another third party to look into the issue to get it resolved.
So in effect you have dumb files passing through dumb pipes, and services paying out on information that is often conflicting or wrong, and with no place to fix it, and share the correct information once it’s been figured out.
So when my daughter says, “Alexa please play the Moana soundtrack?” Our echo dot box contacts Spotify, which then serves up a file from its servers, tracks the play, and pays out 70%+ of the revenue due to the “rights holders.” These multiple intermediaries then figure out who’s supposed to get paid, take their bit, and then, in theory, all that is owed gets paid to all who are due their monies, right?
According to some some estimates this has lead to billions of dollars in so called “Black Boxes” around the world that are due to creators who for a multitude of reasons don’t end up with the funds owed to them. Some of this money is divided according to market share, although there’s not a lot of transparency around this and we are still left with the same issue: that we simply aren’t using the right means of moving music around the internet. We don’t have a smart and usable media asset that is fit for the services available in 2017, just as my phone from from the early 90s isn’t fit for a modern LTE network today.
The MP3 was already four years old when this beauty hit the stores.
A song like any other digital asset becomes smart when you can identify from the file itself who owns it. When you can query the file to see what it is and how you can (should you choose to) commit commerce with it. A song becomes smart if you know who wrote it, not just who performed it, and who played on it, contributed to it, etc. This knowledge means that you can set rules into the file itself for how it can be used.
SONGS AS SKILLS
The reason it’s so important that we get this next bit right is that a smart, or to use Amazon’s term “skilled,” song can talk directly to a machine, like an Alexa device, and can inform Alexa that yes it does indeed have the right to play the song (the permission), and that if it does so then there is a fee or a data exchange (obligation) due to all of those who are a party to the song in question.
It’s my belief that the smart assets themselves are going to be what these modern devices and networks will require to live up to their full potential, and this means that the majority of revenues can be paid directly to those whose rights are enshrined within the songs themselves. If the machine knows who to pay then it can do so, and not have all the stops along the way dragging down the whole system.
This means that artists can create and set their own rates for certain uses should they choose to. I can see a future in which the devices in our homes will offer us the option of receiving the music directly from the artist or via a service with the knowledge that if they choose a more direct-to-the-artist route that these artists will receive more of the money due to them. It will make no difference to the machine who gets paid, as long as it’s easy. I can see a whole generation of new services emerging that will offer artists sets of competitive smart contracts that can be added to, and that will travel with their musical and visual works. These contracts, or skills, will allow skilled songs to negotiate directly with services such as Alexa, Google Home, Apple Home Pod, and others. Per-stream rates can be negotiated at the song level digitally (and in fractions of a second), like for example with differentiated pricing for Prime versus non-Prime members, subscribers versus non-subscribers, and past purchase history.
Artists can make their digital works available to any and all services at terms that they set, all of which could be communally searchable owing to the commonality of metadata around ownership.
This change will also grow the sync market for VR, TV, and film licensing to way beyond its current 8% of the global music market revenues. This side of the industry is currently agonizingly slow since it requires all parties to the song to consent sometimes by email, fax, or even letter.
“THE INABILITY TO IMAGINE A WORLD IN WHICH THINGS ARE DIFFERENT IS EVIDENCE ONLY OF A POOR IMAGINATION, NOT OF THE IMPOSSIBILITY OF CHANGE.”
I believe that we are about to witness one of the most profound shifts in how music is consumed. If I had to make a prediction today, I’d say that my daughter will never log in to a service like Spotify, Apple, YouTube, or Soundcloud as they exist today to access her music or video. The idea of typing an artist or song name into a traditional user interface will seem ridiculous. As these technologies evolve and AIs begin to predict what we will all want to hear or see next, having the maximum amount of accurate data packed into the song files themselves will be a prerequisite for getting an artiste work found and most importantly monetized.
Creators, rights holders, and influencers who can digitally express their rights into their media will control their own destinies, whereas if we continue to rely on the existing telegraph cable-like technology to try and track down ownership, usage, payments, and rights as they surround our ’90s file types, then we will subject our creators only to the whims of these massive companies, their shareholders, and business models, which are sometimes fundamentally at odds with the creators in the first place.