Blockchain technology has myriad of applications and its impact on Entertainment industry is going to be disruptive. Entertainment industry has always battled huge issues such as piracy, unfair artiste compensation, creative ownership tussles, royalty thefts, and so on. The tamper-proof, distributed ledger system used by blockchains will remove intermediaries such as media aggregators, production houses and studios that eat up a lion’s share of collections that rightfully belongs to content creators.
Let us take a look at how blockchain technology is poised to change the landscape of media and entertainment industries:
Smart content distribution
Not so long ago, artists could not hope to publish their content without the backing of influential production houses or music labels. The internet solved this problem by digitaliszing media but gave birth to a new breed of intermediaries such as Youtube, Netflix and Spotify. They pocketed 50-60% of revenues they helped create, host and distribute and creators were left empty-handed.
Enter the blockchain.
Now content can be hosted on a blockchain directly without the aid of any intermediary. Content creators can formulate rules and conditions (smart contracts) for regulating who can download, stream, sell or share their content and how revenue should reach them. Grammy-winning musician Imogen Heap has distributed her music album using the Ethereum blockchain. She has complete control over her content and the money it makes for her. Stem and Patreon are some one-stop shops where artistes can manage their payments and control their content’s movement.
Imogen Heap has recorded the first ever song on Ethereum blockchain and shown how a song can be released as a digital music contract without the need of any intermediary
One of the crippling problems of the entertainment industry is the unfair royalty system it harbors. It’s quite easy to copy and distribute content freely available on the web. There are often scuffles over ownership rights of creative content. Taylor Swift’s tussle with Apple Music and Spotify is a case in evidence.
The five ways by which artist rights can be protected by using blockchain technology
Blockchain technology can help crystallize micropayments. Open Music Initiative (OMI) has herded 200 media labels and aggregators to straighten the royalty system problem. They are considering blockchain technology as a solution. The vision is to create a giant repository of all creative content with its creator and story, something similar to Google Image search. Smart contracts will automatically deposit money to the rights holder when their content is downloaded or streamed.
Democratic content consumption
Content consumers should rejoice too. Digital content available through Netflix and Spotify had serious constraints- it was available in some geographical locations and over proprietary platforms only. Blockchains are public and decentralized. Real-time updation of content over the chain happens every second. Individual files have complete encrypted information within them. The days of regional broadcasting are definitely over. Audiences can catch their favorite shows over any platform from any corner of the world, if their credentials match with the conditions encased in the blockchain smart contract.
World’s first decentralized music platform based on Ethereum and IPFS
In an industry where copying and distributing content is a cakewalk, the encrypted security that blockchains offer, come as a breath of fresh air. While it’s nearly impossible to eradicate piracy at the grass-root level, blockchain technology can make the task easier. Content creators can embed encrypted tags in their content and then keep a close watch over the tag’s movement to catch the culprits. Time-stamping of blocks makes it fairly easy to back-track all nefarious transactions till you reach the epicenter of the problem.
Crowd funding ICOs
Initial Coin Offerings (IOCs) are similar to IPOs but raise funds for new cryptocurrency ventures. Crowd funding creative ICOs using blockchain technology will give investors a transparent glimpse into where their dollars are going and how much is owed to them. When their invested project starts yielding returns, smart contracts automatically transfer revenue to the investors.
Ad-based monetization models are hardly profitable for artistes. Most of the ad revenue is fleeced by publishers, distributors and middlemen. A blockchain-based ad model can help trade publishing contracts efficiently. Smart contracts will be privacy-compliant so that ad viewers’’ identities are protected.
To sum up
Make no mistake about it. Blockchain technology will radicalize how we create, publish, distribute, and consume entertainment content. The industry notorious for its gate keeping problems will find blockchain a blessing!