Did you know that artists made $83 million in basic sales via NFTs in 2021? The good news, according to an exclusive Bloomberg report, is that a whooping 70% of that bag went to independent artists. You heard that right! In this guide, we will discuss how artists are using the web 3.0 as a leverage to make more money from their music compared to the pennies they get from digital streaming platforms.
In a modern music industry built by the labels and for the labels between the 30s and 50s, saying that independent artists made more money than labels sounds like wishful thinking. I guess you were baffled when this blog came up on your screen. But you can rest assured this blog is no prank.
Yes, it is true that the majority of the music market is controlled by three giant corporate labels, namely, the Warner Music Group (American), Universal Music Group (French), and Sony Music Entertainment (Japanese). And a large chunk of the most-sought-after artists are also signed to these companies.
However, the internet, the same artificial factor that caught the music industry by surprise in
the early 2000s and democratised music distribution, remains undefeated. Instead it has evolved into a more decentralised version, web 3.0.
What is Web 3.0?
The Future, one where users become owners. Unlike Web 2.0 which is controlled by big tech companies (who also own the music industry), web 3.0 is a decentralised internet built on the back of Blockchain technology and token-based economics. Coined by the Ethereum founder, Gavin wood, Web 3 became the alias for the decentralised web.
Death of Big Data and the rise of Independent artists
Big data is an umbrella term for data sets that are too complex for conventional data-processing application software. It lets big organisations make precise decisions. Do you wonder how Sony Music A&Rs know the best time to drop music? They have access to information smaller artists can’t access, hence they have not just financial power but statistical power over independent artists.
The primary benefits of Web 3.0 according to experts are data security, scalability, and privacy. Have you ever been harassed by pop-up ads on websites asking you to give them access to your data before you can proceed? Can you recollect seeing an ad about a product on Facebook after you searched for a related term on Google? In the Web 2.0, our online behavioral patterns are being monitored and our cameras have been infiltrated.
On the other hand, the web 3.0 is their worst nightmare as it relinquishes their hold on artists and everyday users. For independent musicians, the web 3.0 marks the beginning of new markets similar to those that emerged as a result of cryptocurrencies and NFTs (non-fungible tokens). Artists can now earn more money from their music by selling audio files as non-fungible tokens.
Of course, there are endless channels of monetizing your music. Here’s the catch — From merchandise sales to touring, these means of revenue are not entirely accessible to booming artists plus they require capital to be successful.
Out of the vast array of financial opportunities of cashing out via your music, the NFT sphere pays the most and provides uncensored access directly to artists (upcoming or established).
In a Bloomberg interview, an international independent artist named Europe, revealed that she made $60,000 from her music NFTs sales. According to her, “I had one person buy my song for the amount it would have taken a million streams to get”. She made more money in NFTs per month than she got on a monthly basis for 4 million streams from digital streaming platforms.
Europe is not the only artist who went platinum by selling NFTs. A Canadian rapper, Tory lanez, claimed he went platinum a minute after his NFT project, when it’s dark.
Artists no longer have to slave off to get record deals. In fact, they don’t need any label contract. To create an NFT project, all you need to do is attach your music to a verifiable digital token and auction it for any amount of online marketplaces like OpenSea, Block Party,
Rarible, or Mintable. These platforms also keep the track record of transactions. Like CDs, buyers of NFTs own the copies they purchased and can resell them in the future. The ability to resell an art increases its value, positioning your music as an investment rather than a common commodity like a can of coke.
For instance, an artist who goes by the name Allan Kyariga sold ten projects for $40,000. Luckily for the user who bought one of his singles, the person resold it for seven times the original price. The funniest part is that Allan almost gave up on music when the big labels that in his words, “didn’t make sense to take”.
Final Thoughts
Web 3.0 is everything web 2.0 and 1.0 aren’t; hope for the independent artist, checkmate to the big labels, and Robin Hood for our personal data. With powerful companies buying lands in the Metaverse and eyeing the NFT music space, we are unsure if the prosperity of independent artists would continue. While buyers of NFTs don’t own copyright, there is a grey area regarding what they can do with their copies and what they cannot do. However, we can say for sure that this new technology will change the tides of time.
