As one of the oldest entertainment industries in existence, the music business has experienced many technological advancements that improved mainstream adoption. The digitization of music meant that artists could reach any audience around the world, and digital distribution gave people unlimited access to music.
With these advances in distribution came some drawbacks in the monetization of music. The way musicians make money in a digital format has reduced the margins of media or video revenue. Artists have been pushed to generate income from offline endeavors such as concerts and merch sales as the online landscape has been filled with middlemen who take a piece of the pie.
“Web3 and existing platforms are helping us build a new chapter in the music industry.” Takayuki Suzuki, CEO of MetaTokyo – Web3 entertainment Studio – told Cointelegraph: “It was difficult for me to find good music, checking many record stores in Tokyo and sometimes abroad. Now it’s very accessible via streaming” .
A new paradigm of Web3 tools gives creators the means to develop an existing audience and transform it into a community. Relationships with fans have become crucial and have never been closer with artists on Web3.
Marcus Feistl, COO of Limewire, a Music NFT marketplace that was originally a free software peer-to-peer music file sharing platform, told Cointelegraph:
“The music industry and creators are undoubtedly on the cusp of a major shift, moving from a Web2 model focused on content consumption to a Web3 model focused on content ownership. Artists are just beginning to find ways to use Web3 to interact with their audiences.”
Among the many use cases for non-fungible tokens (NFTs), the most prevalent has been the ability to form communities around token holders. The rise of decentralized autonomous organizations experimented with coordinating these communities digitally natively. All of this offers potential opportunities for independent artists willing to innovate in the next iteration of the music space.
Disrupt the music industry again
The music industry has always been willing to try new things. As Mattias Tengblad, CEO and co-founder of Corite, a blockchain-based crowdfunding music platform, told Cointelegraph, “When music videos came out in the 80s, it was completely new and people weren’t sure what to make of it. . Adoption of these things often starts slowly, but eventually becomes mainstream.”
Web3 platforms are in their early stages. Most users are experts in cryptography and have a basic technical understanding of how to interact on chain. As the space develops, Web3 music platforms may become a key piece in the way record labels and artists do business and market themselves.
The opportunities offered by this technology facilitate connections between like-minded people that break down any previous barriers to form a community. “It was hard to maintain good relationships in the industry,” Suzuki reflected, “I’ve been constantly meeting and reconnecting with forward-thinking people.”
These innovations are not exclusive to the music industry’s headliners, and young talent originating from Web3 can open doors for new expression and monetization. It is fostering the relationship between artists, intermediaries and fans to transition into a community.
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Musical innovation allows artists who are trying out new technologies with the opportunity to become the next established artists of the next generation. This can potentially diminish the importance of record labels to an artist’s success. Many record labels are getting involved by moving some of their activity to the chain and launching NFT collections.
“There will always be a need for record labels, but I think those that don’t adapt to the changing landscape risk being left behind,” Tengblad said, adding:
“Once you have a loyal group of followers, I think technology opens the door for you to directly monetize your work, while also sharing the benefits of your success with your followers.”
Music NFT’s successful publications show how Web3 can disrupt the fundraising model by allowing artists to go directly to fans for funding. Those artists who strive to engage with their community and build a direct relationship with their fan base will benefit the most from Web3.
From the public to the community
An audience is generally understood as a one-way relationship, while a community suggests a two-way communication between the artist and his fans. For a community to be productive, those involved should enrich the creative process by actively listening to the needs of others and proposing solutions for the betterment of the community as a whole.
As artists move to a more community-driven approach, blockchain and NFTs allow artists to raise funds from their fans without intermediaries and offer unique benefits and opportunities to contributors. The dominant platforms remain a crucial tool for community building and music distribution to complement a Web3 strategy.
“Affordable digital recording has led to an explosion of musicians on YouTube reaching out to their community for collaborations, instant feedback, live streams, and more,” Tengblad commented. “Social networks and chat programs like Twitter, Instagram, TikTok, Telegram and Discord give people who are interested in what you’re doing an opportunity to engage with more content, connect with you and each other.”
If an artist posts a new video on YouTube, their community can contribute to the artist’s work by providing instant feedback and suggesting new ideas that can help the artist grow and develop further.
Activities carried out by the community usually have a greater impact and immediately affect the growth of an artist. With the support of a strong community, artists have a solid foundation to build a career on.
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The engagement process between the artist and their community should be as simple as possible. Suzuki explained:
“Web3 will give more power to artists and creators, so education would be needed. Intermediaries could be supporters or collaborators of a community that does not intercept information or money.”
This starts with clear communication and making NFTs more accessible to everyone. Bringing NFTs and the content ownership model closer to fans is what will ultimately drive artist communities as it creates a much stronger and more exclusive connection between fans and creators.
“For creators, this means a user-friendly self-onboarding process where they can create their first NFT project with just a few clicks,” Fesitl concluded. “For fans this means you can use an escrow service entirely without the need to own a wallet or directly connect an external wallet, providing the full Web3 experience.”
The artists who are most poised to succeed in today’s industry are those who are willing to use all the tools available to them to create an interactive and engaged community around their work.
