Can blockchain technology be a new source of revenue for underground musicians?

Ultimately, the problem is money.

Shouldn’t a minimum ‘livelihood’ be guaranteed, whether it’s making music or drawing?

However, as most performances/events have been canceled or postponed indefinitely due to the aftermath of the corona virus, artists have no place to go.

<https://www.ifpi.org/resources/>

According to data from the International Federation of the Phonographic Industry(IFPI), the total global music market sales in 2020 will be 21.6 billion dollars, of which 60% is the streaming revenue (13.4 billion dollars). It grew by 40~60% every year since 2010, and from 2019 the upward trend slightly decreased, but it is still growing by 20%. As can be seen from the graph above, while sales of music albums and downloads are decreasing year by year, sales are being concentrated in the streaming sector. The size of the Korean music market is large enough to rank 6th in the world as of 2020, and the streaming sales in Korea have reached 2.3 billion dollars in 2021, growing by about 12.6% every year after achieving 1.4 billion dollars in 2017. It is expected to reach 2.6 billion dollars in 2022.

Then, as a result of this explosive growth of the digital music market, did underground musicians get to lick the sprinkles on the sundae? Unfortunately, I think I have to answer ‘not yet’.

It is very difficult for musicians without an affiliated agency to generate revenue through music. One of the reasons is that, in order to register a sound source on a music service platform, a record agency and a sound source agency, aka a sound source distributor are required, but it is difficult for underground musicians to do so. The second reason is due to the complicated sound source revenue structure. To explain this structure simply, if 10 cents of sound source revenue is generated, the music service platform is distributed 35%, the producer 49%, the copyrighter 10%, and performer 6%. If the fee of each related association is deducted from this, the actual revenue received by copyrighters and performers will be even less.

It is difficult to register and sell a sound source, and even if it is sold, the revenue that falls into the pocket of a musician is an amount that is too insufficient to compensate for the time and effort that an artist had to invest in creating. There is no better fit for the old adage that “One man sows, another man reaps.”

However, with the development of technologies such as block chain, NFT, and Web 3.0 in recent years, efforts to fundamentally improve the profit structure of creations are appearing all over the world. These technologies are expected to be a way to maximize the profits of creators by excluding unnecessary objects that have played an intermediate role in the distribution process of creations and connecting creators and consumers directly.

Artists are rewarded without deprivation of the profits for their work created through their efforts with technologies such as NFTs and smart contracts, and users can support their favorite artists as much as possible. Users can also be rewarded for the simple act of appreciating, sharing, and evaluating artists and their work through P2E technology. As such, blockchain technology is a future-oriented technology that distributes the results of a virtuous cycle to both creators and users, and enables a diverse and sustainable art ecosystem.

Attempts to introduce blockchain technology into the music market are increasing worldwide, and Korea, the world’s 6th largest music market, will not escape this trend. The underground music scene is one of the big cornerstones of popular music that is indispensable for Korea to grow as a content powerhouse. Only steady interest and efforts in blockchain technology and the underground music scene will make it possible to become a leader in the future digital music content market.

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