I’ve spent twenty years building digital music applications and companies, most recently Beats Music and Apple Music, previously at Yahoo!, Winamp, Topspin and Beastie Boys.
These days I work at Ledger and embrace the utility of crypto, so I’m often asked the question, “What about music on the blockchain?”
“Meh,” is my standard response.
I don’t see the innovation or consumer need to ask people to buy NFTs for digital music the way they bought CDs, or to put digital ownership into streaming services meant to compete with Spotify. Listening to music on the Internet is a problem solved, and music listeners don’t need the help of a blockchain to hear what they want. Just say, “Hey Siri, play The Beatles,” to remind yourself how far we’ve come since Napster.
The music rights industry is an oligopoly controlled by three major labels and four digital music services, none of which have an interest in open standards.
But the two-sided marketplace Bandcamp is a great place to think about the value that blockchains can and will add to the relationship between artists and fans, and how that change will happen slowly over the next fifteen years. Below is a thought exercise using Bandcamp to demonstrate how digital ownership can meaningfully change the paradigm without asking consumers to change their habits all at once.
For music fans – and especially fans of niche genres like heavy metal and contemporary jazz – Bandcamp is popular. The site launched in 2008 and slowly blossomed, building a passionate community of music lovers over fifteen years. Bandcamp.com’s functionality is simple: stream for free, buy digitally for around $10, and often buy vinyl (Bandcamp even bought a pressing plant to help the makers of their marketplace press vinyl), as well as t-shirts or other physical collectibles from the artist. Artists receive a net average of 82% of each sale, and Bandcamp has paid out approximately $1 billion to artists and labels who sell on the site since its launch.
But in March 2022, Bandcamp was sold to Epic Games.
“Bandcamp will play an important role in Epic’s vision to build a creator marketplace ecosystem,” Epic Games wrote in a statement. Bandcamp unionized in March 2023, and when Epic Games announced it would lay off 16% of its total workforce in September, a sale of Bandcamp to Songtradr was announced.
With only 50% of Bandcamp staff retained, the community loudly expressed concerns about Bandcamp’s future, culminating in this Pitchfork article: “Is Bandcamp as We Know It Over?”.
The drama and response from Bandcamp’s community have reminded us – like MySpace, Flickr and so many other platforms before – that the investments we make in centralized internet products are neither our property nor permanent.
Ultimately, these are for-profit businesses, with investors looking for results. Our investments in the platform are of value to them, not to us. The digital albums purchased, as well as the ‘relationship’ between artist and consumer, are the property of Bandcamp. When they disappear, so does the artist’s access to their fanbase and the listener’s backup of the music they paid for.
With decentralized ownership this could be fundamentally different. If I were in charge, I would customize Bandcamp as follows:
- Nowadays, when an artist finishes his album, his “master” copy of that recording is on his hard drive. Hopefully it will be backed up and remain in a safe place for generations to come.
What if Bandcamp helped artists create an on-chain master, define the provenance of the work, and link it to the media files on a long-term and decentralized storage solution like IPFS? The longevity of the work would then depend on the longevity, security and decentralization of the blockchain and IPFS – and not on Bandcamp.
- Today, when you “buy an album” on Bandcamp, you purchase the right to download a zip file of the MP3s, and you can return to download it again as long as the Bandcamp service is up. Nothing more nothing less.
What if instead you actually got verifiable ownership of a digital copy of the album, with references to the media files residing on a long-term and decentralized file server like IPFS? Now your “ownership” of that album could outlast Bandcamp. Additionally, your proof of ownership may grant you privileges such as an early purchase of concert tickets or a private audience with the artist. You could point out the ability for non-owners to right-click on the music files and save them, but that’s also possible already stream every album for free on Bandcamp.
There is no fewer “security” in this model is just a layer of abstraction from the item itself, away from Bandcamp, to the blockchain, assigning digital ownership to the buyer. Listening to music is already free on Spotify, YouTube and especially Bandcamp. Blockchains provide the opportunity for patronage to gain recognition and perks without the need for another centralized proposition like Patreon.
- Nowadays, on Bandcamp you can often buy physical collectibles such as vinyl, t-shirts, cassettes or other items directly from the artist. What if they added the ability to create a digital to collect in a scarce quantity? Would more or fewer people prefer these digital collectibles over the physical vinyl?
Many believe that digital is “less valuable” than physical, but we already know that many who buy vinyl never play it or even own a turntable – it’s just a form of patronage and collecting. If the option to purchase a digital collectible were added to Bandcamp album pages, some artists would find creative uses for this feature, some fans would choose to collect the digital over the physical, and the ratio would between digital and vinyl collecting shift over the next fifteen years. I’d like to see this happen over time; I’m betting that digital collecting will reach a turning point, just like media streaming did around 2012.
The ambitions could be set higher than I suggest above; digital packaging and payouts to creative collaborators like Metalabel are building would be very useful in the Bandcamp context.
Read more in our opinion section: You’re not thinking hard enough about digital art
You can also imagine that artists make money property in Bandcamp based on performance and a revenue stream for artists where the platform’s profits are paid out based on this ownership (what Visa was for banks, Bandcamp could be for artists).
But I like the simple thinking described in the points above, especially because the changes are subtle and simple, yet meaningful for both artists and fans, without asking either to change their mind overnight to change behavior.
But we have to keep this in perspective: the entire music industry made $26 billion in revenue by 2022, while Bandcamp has only paid out $1 billion to artists since 2008. The examples above also show how application developers in categories outside of music will integrate digital ownership slowly and optionally for their customers, rather than an overnight Web3 ‘big bang’.
Digital ownership is inevitable, but let’s be realistic about the problems it solves and how quickly this new paradigm reaches mainstream consumers.
Ian Rogers is the Chief Experience Officer at Ledger, leading the consumer-facing company that provides the world’s #1 way to buy and secure cryptocurrency. Previously, Ian spent five transformative years as Chief Digital Officer at LVMH, where he worked with a portfolio of nearly 100 luxury brands, including Louis Vuitton, Dior, Sephora and Hennessy. Ian also sits on the boards of Dr. Marten’s and Lyst. Ian spent 20 years bringing digital music to the mainstream, first at Winamp, then at Yahoo!, Beats and Apple. Ian helped launch Apple Music in 2015, including Beats 1, their digital streaming channel. Ian graduated from Indiana University in 1994 with a Bachelor of Arts in Computer Science (cum laude, Phi Beta Kappa). Ian built some of the first music-related websites in the early 1990s and has worked with Beastie Boys since 1993.