Web3 – How new technologies will revolutionise the music industry

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In March 2023, we hosted a live webinar on how Web3 technologies are impacting brands and how to experiment with them as they emerge.

Led by &us co-founder Rob Fletcher Isaacs, he was joined by Scott Doran, SVP Global Creative Licensing, BMG Production Music and Jon Moss, Customer Engagement Director at Fortnum & Mason, who shared their experience and insights into what’s going on in the Web3 space, how it’s showing up in their industries and how the best way forwards is experimenting with it.

 

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In the first of a series of Experimenting with Web3 &us blogs, we’re sharing our interview with Scott and his take on how Web3 technologies might revolutionise not only music, but any industry that deals with licensing, loyalty, royalties and contracts.

Scott: “I started in bands as a singer-songwriter through the 90s and early noughties and transitioned into TV and film composing. Around 2010 I started a music publishing company focused on film and TV, and in 2016 that was acquired by the BMG UK Production Business, where I now have a sales and marketing role. It’s media services where film and TV touch sound design. We work with a lot of studios like Netflix and Disney. A lot of the music you hear is acquired or composed by us.

“I was talking about Bitcoin in 2009 with my business partner, and we did nothing with it, which I’m still annoyed at myself about! In 2017 I was observing what was happening but not getting involved. Still, not long after that, I started reading stuff and listening to podcasts about fixing money, scarcity etc., and once you get your head around the fact it’s digital, not absolute, there’s no going back.

“From that, I transitioned more into understanding Ethereum and the potential around that, and then NFT artworks came onto the scene, which I didn’t get to begin with, although I do now. It’s slow learning.

“When I heard about The Sandbox, I went and looked at some videos, and suddenly it started going off. It will be interesting as long as they can keep the scarcity. Self-creators are going into this world doing exciting things, which will be amazing.

“The control is now in the customer’s hands.”

“Now I keep thinking about loyalty and how Web3 tech creates it, for example, a smart contract. Information can be verified and kept inside, and it has incredible potential for how people feel loyalty towards brands. You might have reward points for your local supermarket. Still, if that were NFT-based technology, you could trade those loyalty points with another token you prefer – another supermarket perhaps –  and the brand would realise that they don’t have your loyalty if it’s only held captive by geography, for example. The control is now in the customer’s hands. We have to think about giving people what they want, which sets off a chain of events regarding the brand’s authenticity and whether it fits the customer.”

Rob: “It’ll be interesting to see which businesses play with that first. Given the potential risk for companies, it’s not in their interest for people to swap loyalty points.”

Scott: “A lot of brands will think that’s the advantage. Take a new coffee shop, for example. You verify the provenance of your beans, and your employees’ training is confirmed. It will help customers feel that sense of community and loyalty to you. And other brands will then have to get involved as they’ll see the damage to their brands if they don’t do it.”

Rob: “Do you see Web 3 as something similar to the arrival of Spotify or Netflix into the market, forcing brands to change, a new way of doing things? Where do you think that goes?”

Scott: “You couldn’t have predicted that. The old model was based on the available technology and the availability of music. You do things one at a time. It was a paradigm shift to have everything available all the time. 

“I love the fact that anyone can listen to anything now. Before, major artists would release an album and it dictated to people what they could buy that month. For example, if Madonna released  a new album, it would be the only thing you’d see that month, and it could squeeze out a lot of up-and-coming independent artists that might be more suited to the person listening. Now with Spotify, it’s completely open, every genre is available, they’re all successful simultaneously, and the user has the power.”

Rob: “Music has been a big part of Web3, with music NFTs, and in the metaverse and sandbox, artists like Snoop Dogg have been very visible. What has piqued your interest?”

“If you have an asset that earns you a royalty, that’s an asset to take seriously.”

Scott – “What is interesting is the potential for technology to bring artists and their fans closer together. Recently we were commissioned by an NFT business called Jurassic Punks to make some music for a video they were doing. Instantly; the ideas started coming into the conversation. This music could be split into a thousand pieces, and then the owners of the NFT all have a stake in it, and it gives genuine added value in addition to the visual NFT. As a fan, buying an album could provide access to additional merchandise or entry to hear an album first in a Web3 setting or have a whole part of the audio mix, which in the future becomes more valuable and maybe they can sell it on.

“Something I’m personally interested in is the potential of fractional royalties. In the current setup, there may be 4-5 songwriters on a piece of music, but they could share that with an entire fanbase of a million people. How does that work? The ability to not just own it but potentially earn a royalty from it. This answers one of the biggest questions about NFT’s – for most people there’s no intrinsic value or utility in an NFT, but if you have an asset that earns you a royalty, that’s an asset to take seriously.”

Rob: “Definitely something to dabble in and be curious about. How are people talking internally about this? What’s the attitude?”

Scott: “On the commercial side there are early-stage conversations taking place, like how do we release a limited run of NFTs that contain certain value that the fanbase can access? And in my area, we’re more concerned about AI and what that does and where we go with that. 

“Probably it’s also more the tech side of what it can do – contracts, composer agreements. There is real room for error in publishing contracts, there is no cast iron version of the truth. But Blockchain would completely solve that.”

Rob: “It feels like there’s opportunity now, maybe not commercial revenue but the ability to learn how to do these things smoothly, and at scale and beyond borders.”

Whatever is going on now is likely to totally change. It’s like what Google maps did to maps. The map is now almost the least functional part of the map”

Scott: “Whatever is going on now is likely to totally change. It’s like what Google maps did to maps. The map is now almost the least functional part of the map, it gets you there and guides you there and tells you what the local restaurants are, that’s a smart map. And that’s what NFTs are going to bring to contracts.”

Rob: “What’s going to happen next? What are we going to see this year?”

Scott: “More experimentation! My guess is that someone will come along and do something unexpected that’s a game changer and everyone will jump in and take it seriously. Until there’s something big, like what Amazon did for online shopping, where it’s not really about the technology and more about the customer. 

“A case of watch this space for some penny drop moments!”

To get started experimenting in Web3, let’s talk

You can watch the full webinar below

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