PRS Explores: Blockchain
Blockchain has been the hot topic in music circles over the past 12 months, driven in part by a specific focus placed on its potential by talks at Midem, and the ‘Rethink Music’ report that came out last year.
However, now that the dust is starting to settle after the initial explosion of hype, we wanted to create an opportunity for proper, reasoned, debate between the early adopters and advocators of blockchain technology within the music industry, and the key stakeholders within the industry itself.
PRS is positioned uniquely within the industry; operating for publishers, writers and licensees; yet at our core is the drive to ensure that rights holders receive full and fair value for their copyright. Key to this is industry efficiency, and the ability to track and understand usage, elements that blockchain could assist with.
We structured the debate into two panels, led by Graham Davies, PRS's Strategy & Digital Director; one focused on technologists - left-right above : Imogen Heap (Mycelia), Keith Hill (PRS), Mark Douglas (PPL), Phil Barry (Blokur), Thor Pettersen (Internet Music), Alan Graham (OCL), Benji Rogers (PledgeMusic); and the other on rights holders - left to right bottom : Crispin Hunt, Phil Sant (Omnifone), Andy Heath (Beggars), Rupert Hine, Ric Salmon (ATC management)
Below are my key take-aways from the event, based on the views of the panels allied with some of my work on the subject as a Strategy Manager here at PRS.
What is your vision for Blockchain in the music industry?
What is the potential for blockchain within the music industry? Is it, as numerous blogs and publications over the past year would lead you to believe, the silver bullet that is going to ‘fix’ the industry? Or is it in fact just a tool, one of many that are being developed, which has the potential to unlock key value creating and defending mechanisms in the future?
Possibly surprisingly, our first panel pretty much agreed that blockchain lies very much in the later camp.
Blockchain could be utilised in any number of ways in the future to the benefit of the music community, from bringing creators and users closer together than ever before and re-introducing scarcity, through the use of identifying keys, to enabling instant, efficient, payment to artists at the point of use.
There is a risk that as technology develops and piracy becomes even more sophisticated that traditional mitigation methods become less effective, thus there is a drive towards creating something 'better than free'. Blockchain has the potential to be a very useful tool in this fight.
However, for this to happen the core concepts that the music industry is built on remain:
- We are ultimately reliant on the quality of data that is inputted into the system, blockchain enabled or otherwise; if you put rubbish in you’ll get rubbish out, and musicians are notoriously bad at diligently ensuring that data is correct
- Disputes will still happen, the very nature of our industry means that the copyright claim details are often in flux, and will need to be resolved by humans
- A core feature of Blockchain is that transaction and modifications are permanent, thus the need for trusted parties within the music is, if anything, even more important. While disintermediation could bring efficiencies, there is a reason that the industry has evolved to the position that it is currently in!
- It also does not remove the need for collective bargaining. The premium value that is gained through negotiating licenses together, rather than individually will persist.
What are the requirements for development? What are our next steps?
Blockchain developers need to understand the core needs of the music industry before we will start to see real change, for example, linking the relationship of a sound recording to a musical work, and how that can be managed en masse, by multiple different organisations, in a trusted environment.
The potential ‘upside’ of Blockchain adoption is significant, we have the opportunity to tie metadata to recordings, to introduce much improved traceability and accountability from source, however, as with the infamous GRD, a lot of this will require mass industry collaboration.
It is likely that we are going to need a much more open culture of data sharing, which may not be in the best interests of all stakeholders. The music industry is not alone in understanding the value of proprietary data, however, true development comes when the next generation are given the tools they need.
A suggestion at our panel was that instead of trying to ‘find that silver bullet’, we should be looking to kick start discrete projects that fix specific issues; Mark Douglas of PPL noted a key need around large group performers documentation in metadata, while Phil Barry of Blockr noted that key stakeholders (like PRS) should open up a trial number of works to developers to see what they can do.
Regardless, this is a time to be positive. There is real interest and excitement being generated by this new technology and other developments in our industry. We look forward to seeing where it leads, helping to facilitate the conversation along the way.