Can Cryptocurrency Create a New Niche in Music Streaming?
Can crypto and distributed ledger technology help improve the music industry?
The music streaming industry has come a long way since the old days of Napster and the first-ever downloadable music. The new technology that was the internet, combined with faster download speeds, made music sharing possible.
Since those early days, regulations and structure have provided a way for companies to monetize digital content while protecting it and putting new technology to work.
As the industry evolved, a few major platforms exploded into the market. These early growth leaders received huge boosts as users began tossing out their CDs and flocking to media services.
However, those early days have come to a grinding halt. The technology is no longer new. Rather than massive new user acquisitions, the industry has begun to change, and the proof is readily apparent.
One only needs to look at the events of the last year to see that competition in the industry is growing exponentially. Industry leader Spotify is just one example of how competition has forced companies to pursue new users with a vengeance.
Spurred on by services like Apple Music, Amazon Music and Google Play, the company began the year by offering subscribers free access to its video platform, Hulu. Previously a secondary income source, Spotify hoped to garner new users by offering a “two for one” deal.
Just last week, another Spotify announcement showed the desperation is growing. The newest offer is a free Google Home Mini for all premium users. These continually increasing benefits highlight what many on Wall Street have already deduced: The music streaming industry is growing more competitive by the day.
Old tech, new tech
What’s more, the very thing that made streaming music so revolutionary in the first place may be part of the cause. The internet revolutionized the music world, but it is also a harsh taskmaster, and new innovations appear to be making competition even stiffer.
One important example is the tech world’s newest darling, cryptocurrency, which is used with distributed ledger technology. It has been used in peer-to-peer platforms that allow musicians to sell music directly to listeners. Much like Airbnb for living spaces, DLT allows users to connect directly to their favorite musicians and buy and stream their music without third-party interference.
What’s more, recent statistics show that with older-model streaming services, musicians made only 12% of the total revenue. This new system eliminates the centralized corporations that take profits from creators.
Challenging the status quo
With the ability to bypass much of the profit-taking, musicians and listeners alike are beginning to turn their attention to the ways DLT can change the industry. For example, Tune.fm is a music streaming platform that uses a cryptocurrency (the JAM token) powered by the DLT network Hedera Hashgraph. JAM enables musicians to automatically receive micropayments for every second of music streamed.
With cryptocurrency, artists can receive their payments much faster — within minutes compared to months or even years with legacy systems.
And, remarkably, this system is far better for listeners as well. With no subscriptions fees and no add-ons or contracts, listeners have far better access to the music they love at a lower price.
No such thing?
While many would say that there’s no such thing as a win-win in complex markets like music, technological advancements are always making inroads into various industries. With cryptocurrency, the music streaming industry may be changing forever.
Just as Napster revolutionized the world of music, cryptocurrency may come to be the great market-mover for future listening choices. With lower prices, better access and happier musicians, the future may be here.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.