If you have stumbled across terms such as Bitcoins or Ethereum, you probably already know the potential these technologies hold. As a matter of fact, although the Bitcoin phenomenon seems to have become increasingly widespread in the last few years, surfacing regularly into mainstream media, currency is only one of the many uses of blockchains.
What makes this technology so dynamic is that it allows digital information to be distributed equally to several computers at once through a series of set algorithms. Each piece of information stored is self-validated by a network of computing points (also called nodes) every few minutes.
Imagine a file that is duplicated across a network of computers which is also designed to securely updated and store this file. This is where blockchains hugely differ from other technologies, because the information distributed with blockchains cannot be controlled by one single entity right as it happens with “regular” currencies or files.
Basically, blockchains act as a distributed ledger that underlies all cryptocurrencies. It provides a way to save and share data in a sheltered, safe and resistant manner. All data we input in blockchain technologies is verified and protected using cryptography, making them very hard to hack or corrupt.
This process of decentralization combined with the fact that blockchains have no single point of failure (Bitcoin has been continuously working as a currency with no disruption this far), make them a source of hope for many industries which are currently undergoing digitalization, especially considering that any kind of information could be attached to these chains. Which is where smart contracts come in.
Smart contracts are also known as self-executing or digital contracts. They are essentially coding functions which can help us exchange money, shares and property. Smart contracts are autonomous in that everyone is free to make their own arrangements, which are then automatically managed by the network. This also results in a huge save for the individual, for smart contracts eliminate the presence of any intermediaries.
With this perspective in mind, Blockchain is a new way of managing trust. Smart contracts would allow musicians to get paid directly from their fans without having to give up a large share of their revenue to third parties. Smart contracts can also help with licensing problems. By cataloguing songs and albums with their respective creators and musician, in fact, it would be possible to guarantee each artist their fair share.
The current dissatisfaction with the payment system in the music industry derives from the major flaws in the distribution of revenue, something that has affected the up and coming artists and major artists alike. Some 20 to 50% of revenues within the industry are kept within the tangled world of distributors, publishers and record labels.
Of course, smart contracts are far from perfect. They lack the economical and legal credibility that “regular” legal contracts hold. This means that, in a court room, standard paper contracts would still be better than their digital relatives. More on the point, as smart contracts are based on coding languages, they are dependent on them. What if I send or receive a wrong code, for example? These are only some of the issues that come with this wave of technological innovation.
However, a new and ideal blockchain system would require both a huge amount of data to be inputted as well as a substantially large amount of computational power. Nobody has yet addressed these issues as of yet. Nonetheless, each change come with its problems, and we should not dismiss the potential of smart contracts (or blockchains) just because we are presented with difficulties.
For years both researchers and many who are passionate about the music industry have been speaking out about the possible application of blockchain technologies to revolutionise the music industry. Interestingly, a handful of companies have picked up on the possibilities that blockchain present us with. Imogen Heap’s Mycelium is one of them. Mycelium’s mission is to empower artists through a fair music ecosystem via online services. By using artists’ metadata, the company aims to implement effective changes that will result in better and more fair remunerations.
Perhaps even more so to the point, Opus has allegedly built the first decentralised music platform based on Ethereum and InterPlanetary File System (IPFS; a peer to peer hypermedia protocol that aims to make the web faster and more open). Opus’s mission is to replace platforms like Apple Music or Spotify who many feel take advantage of artists, keeping up to 80% of artists’ revenue.
Opus is quite unique in that it has developed a 4 layer decentralised system. The first layer consists of IPFS used as a storage for songs. The second is an Ethereum-based logic layer that specifically handles transactions on the Opus network. The third is occupied by a Universal Music Registry Number (UMRN) that keep track of a global ledger of music tracks, while the fourth layer is an Opus-API that enables anyone from all around the world to access the website and play tracks all around the world.
These are only two pieces of a much bigger puzzle that is yet to be solved. But the efforts shown by these two companies exemplifies the magnitude of the change to come. The music industry might indeed be revolutionised by blockchains technologies, perhaps in more unexpected ways than one could think of.