As blockchain technology continues to revolutionize many industries, the music industry may be in for the most advantageous shift yet. Well, for the artists, at least. The record labels? Not so much.
This is thanks to new startups, such as Royal, that have discovered a way that allows artists to share their music with their fans without the middleman, such as record labels and hedge funds, by utilizing the blockchain.
What is Royal?
Royal allows artists to sell tokens (technically NFTs) for the songs that they release on the platform to their fans. Each token represents a percentage of the royalties earned from streaming services, determined by the artist. Typically, there are several tiers; the more you pay, the higher the percentage you earn. Additionally, the artist can offer other benefits, such as licensed non-commercial use of the album or song artwork, access to unreleased music, and signed merch.
Currently, you can purchase a token for Diplo’s new single, “Don’t Forget My Love.” For $99, you get 0.004% of streaming royalties and access to the Royal Discord channel. For $999, you get 0.0500% of streaming royalties, first dibs on the next Diplo drop, exclusive Diplo DJ mix, and access to the Royal Discord channel. And, for a sparkly 10 grand, you get all of that plus a guest list pass to one of Diplo’s shows and 0.7000% of streaming royalties.
Royal users pay for these tokens through their third-party crypto wallet. If they do not have a crypto wallet already, they can sign up for one at the point of purchase.
Benefits to Fans
Although these prices are steep, especially compared to your monthly Spotify subscription, the beauty is in the investment. On July 28, 2022, 3LAU released $19,980.72 in royalties to fans. Of course, this will be widely dispersed, making the individual returns seem low to start. But remember when Bitcoin was only valued at $9? This is one of the moments where you need to take advantage of something early to reap the benefits in 10 years.
Ownership of Music
While it may be nice to think that the artists are doing this just for the fans, this is really about the artists themselves, and, honestly, it is about time. Artists have been deeply confined to the likes of record labels for far too long, losing out on a majority of their earnings and not having control of their music. And, if they want control? They have to earn it back.
Take Taylor Swift, for example (sorry, non-Swifty fans). Her entire catalog of music was purchased by Scooter Braun (manager of Justin Bieber and Ariana Grande) when he purchased Big Music, Taylor’s first record label. Scooter Braun then sold Swift’s rights to her music to a private equity firm for a whopping $300 million. Without her knowledge. After asking her to sign an NDA that insisted she never say a bad thing about Braun again.
Okay, apart from the drama, artist’s need ownership of their music for several reasons, but the main issue is the money. When an artist doesn’t own their master recordings, which is the original recording of a song, they have no control of their future revenue streams. Instead, whoever owns the masters earns money from performance royalties, royalties from CD and vinyl sales, and when a song is played on TV, in a movie, etc. The artist is left with having to physically and mentally exhaust themselves on tours, deal with paparazzi, loss of freedom, and impending creative doom while making a small percentage compared to the owner.
Of course, the money the artist earns is still a massive amount, but if you were to put yourself in their shoes, knowing how much their music actually makes, it would indeed be frustrating.
With the help of platforms like Royal, artists can have complete control of all their revenue streams. They can choose how much of a percentage they want to give to fans and can enjoy the rest.
Apart from the money aspect, artists can benefit from a greater sense of creative freedom since they do not have a record label breathing down their neck expecting them to pump out album after album.
If you didn’t know, when an artist is signed to a record label, the label promises them massive success but for a deal. The record label will pay for the music recording and even the tour. But, the artist has to pay them back from their earnings. Typically, this takes several albums for an artist to break even. What was once a passion that started in their bedroom is now a business contract sucking them of all inner peace and happiness that originally stemmed from their creative expression.
With platforms like Royal, artists have the freedom to create at their own pace and in their own way, which benefits both the artist and the listener since better music is created when the artist can harness their creativity fully.
Mutual Marketing Benefits
If all of that wasn’t enough, fans and artists can mutually benefit from this system through the wonderful world of marketing. Say you bought a token for one of Nas’ songs. If your goal was to make a profit from this purchase, you could share the song on your socials, tell your friends, request the song on the radio (yes, people still do that), and theoretically increase the number of streams of the song. Since you own a percentage of the royalties made from streaming services, you will increase your payout. On the contrary, you will be supporting Nas since he, as well, will be earning more income. When you support Nas, he provides more music to which you can jam out to. Win-win.
We could go on and on about the unrivaled benefits of artists using platforms like Royal instead of getting sucked into a record label but we actually want you to step away from this article and go check out Royal. Your favorite artist will thank you later.