Web 3.0 is the foundation that drives the creator economy.
Recommended reading: “The Eve Before the Explosion of Community Tokens: This is the Incremental Market with the Most Potential Connectivity to the Real World in Crypto Finance “
Original title: “Earn More? Encryption technology is giving art creators a fairer value”
Written by: Cooper Turley, Audius Strategy Director, Andre’ RAC’ Anjos, Grammy Award-winning artist Translator: Yin Jiansong, author of “Yin Jiansong Talks about Blockchain”
Content plus community are the two major business elements of creators in the digital economy, and encryption technology brings the third element-” collection “. As a result, creators upgrade their works to digital assets that members can invest in, thereby establishing a common interest foundation for the community (this article has been authorized by the original author).
As we all know, music plays an important role in our lives. From Beethoven to Bach, there are all kinds of modern composers, through the 88 keys of a piano, creating an infinite amount of music, really amazing.
But what many listeners don’t know is that artists are now more difficult to make ends meet than ever.
Streaming media is the main source of income for artists in the post-epidemic era, but it has almost no profit. For example, the royalties for broadcasting on digital service providers (DSPs) like Spotify are only a few thousand dollars per million times.
Most “successful” artists are under the banner of mainstream record companies. Music revenue must first be taken away by distribution platforms and managers. The remaining less than half of the income is royalty income to record companies. Record companies usually charge 50% to 80% of the royalties. This means that artists can only get 12% of music revenue (see the picture below).
In fact, it is said that 80% of music revenue comes from touring performances. However, this source of income has dropped sharply due to the outbreak. This makes artists lack a reliable source of income, leaving only some data fantasy about building a new fan base. Unless you pay for ads on Instagram, you cannot reach a wide audience. Artists must also work hard to study the audience’s user portraits (as shown in the figure below) from the data analysis on Spotify, and these portraits can at best deceive children.
So, what should we do next?
How do we design the system so that artists can get the most value from their works, make creators feel comfortable, and let the platform empower them?
Because according to Grammy award-winning artist RAC, it should be enough to record the music .
Open the creator economy
It is said that an artist can survive (and even thrive) as long as he has 100 real fans (or fans who actively purchase or participate in every work released by the artist). Now, a special group of artists is taking this “true fan” idea to its extreme.
This is the emergence of the creator economy: a growing trend where creators form deep relationships with their communities and allow community members to share the collective growth of the community.
The article “Enthusiasm Economy” written by Li Jin said:
“New digital platforms enable people to earn a living in a way that highlights their individuality. These platforms provide creators with greater capabilities to build customer relationships, increase support for their business growth, and provide better tools to enable them from Stand out from the competition. In the process, these platforms are promoting a new Internet-driven entrepreneurial model.”
And, as you can imagine, this is exactly what Web3 does. It’s time to empower the musicians. It’s time for them to take control and create a flywheel around themselves, not around the platform they use.
Content, collection, community
Content
The foundation of all artist projects is their music and the content they create.
But who can say that every recorded piece of music should cost the same price, or even nothing?
No two contents are the same. This is especially true for music. This decision (to give creators more in-depth control over how to monetize their content) is where the smart contract system comes into play.
With the Web3 platform, artists can set customizable streaming media fees, which means that artists can choose exactly how much they want to charge for any piece of content.
Whether it’s just $0.05 for one listening time, $10 for permanent listening, or for free, as long as you are an enthusiastic listener, musicians can start to try new charging methods and get the majority share of related income.
Source of the above picture: Audius’ Twitter
Coupled with the ability of micropayments and a system where fans can pay directly to the artists they listen to, it is natural that you can see the peer-to-peer features of Web3, which will directly benefit future creators.
Although paid listening is the most obvious form of authorized access, artists can start experimenting with geographic and time-specific settings, providing new settings and playback features for creative works—all of which add to the appeal of exclusive content.
Speaking of exclusive content, you may have heard of something called NFT (Non-Homogeneous Token).
Collections
Due to the digitization process, we can finally provide scarce content on the Internet. This trend is called Zora “encrypted media (CryptoMedia),” that anyone on the Internet can create, universally accessible and can be owned by hypermedia content.
Both the media component and the content form of the trading market (see the figure below) best illustrate this point.
Combining these original elements together, we will soon see that the content works have collection value.
The most prominent example is AudioNFT. These are digital collectibles with audiovisual content, which are sold in scarce quantities in NFT markets such as SuperRare. Earlier this year, RAC broke the historical record on SuperRare by selling the “Elephant Dream” work and sold it to the famous NFT collector Max Stealth at a high price of 70 Ethereum.
However, he is not alone.
Digital goods are a new trend. Platforms such as Nifty Gateway and Blockparty provide channels for fans to purchase exclusive products in US dollars, making this trend more popular. Artists working with these platforms include: 3LAU, Space Yacht, Adventure Club, etc.
Even the famous electronic music artist Deadmau5 has also collaborated with Wax and Emanate to create his own digital collection series “RAREZ”, allowing fans to purchase “works” containing NFTs of various scarcity levels.
It is said: “RAREZ is an experimental new music NFT brand created for the distribution of virtual music works and scarce music.”
Now, musicians must find a middle ground between scarcity and accessibility to ensure that their fans can participate in this new frontier field without being squeezed out by capital predators. Why do they want to participate? One word, community.
Discord social platform, Twitch live broadcast platform, Patreon sponsored platform. These household names are some means for musicians to adapt to the increasingly digital world. They spend dozens of hours a week to build communities. All of this is to better connect their fans with the artist’s brand.
We know that fans like to share and consume content, and we now also know that fans like to collect digital goods. The community is the link that keeps the flywheel running.
In order to make the creator’s economy work, fans need a home to share and interact with their peers in a trustworthy and safe environment. This is where the social token comes into play.
RAC recently created $RAC. This is a kind of social token obtained by fans by supporting projects on the above media. Through this token, you can access the exclusive Discord channel and provide early fan exclusive content and unpublished content.
“I think this is a level above all social media platforms.” RAC said: “This is a true fan club, independent of the platform, and can be flexibly integrated with anything in the future.”
Connect all of these and you have the perfect guide for 100 true fans.
An artist publishes content works, sets who can listen to it, and what the price is. They expand the popularity of content by creating a world of digital collections around the content. They provide fans with a home where they can communicate privately in an exclusive chat room, talk about it, and promote it tirelessly.
This is the foundation of the creator economy, and it’s all driven by Web3.
A selected future
But let us not forget those who made this possible: fans .
In the spirit of the ownership economy, the future of music will enable fans to directly share the growth benefits of the projects they support.
Social crowdfunding
Just as liquid mining is used to bring in funds for DeFi projects, the community is likely to unite to raise original working capital for album publishing. This started with a discussion of how many copies an artist should publish, and then quickly developed into the income generated by co-owning the work.
Personally, I am most interested in Catalog.works. It is a digital record store that allows artists to release complete tracks in the form of NFT through an open music market. This is the first time that we will see what it is like to publish a music work entirely on the Web3 platform, and also use Ethereum technology to help creators share income with early supporters.
Featured influence
If we allow fans to pledge funds for their favorite artists and works to increase their exposure, then the effect will generate positive feedback. In return, they can get part of the future royalties. We can imagine such a system. In this system, the “early” viral transmission behavior is no longer just a social flexibility, but a provable chain behavior that can bring direct economic benefits.
And, hey, maybe they can earn some social tokens. What I know is that once you can earn income from the music you promote and “own”, you never want to return to the original state.
What’s next
The pieces of the puzzle are already there, now it’s time to put them together.
I want to send an open invitation to those who use Web3 to create a better future for music. This field has unlimited potential applications, and it is rapidly permeating every conversation between managers, record companies and artists.
To those who came here so early, I commend you for your commitment to innovation.
It’s time for music to get fair value, it’s us who can make it happen.
Until then, please stay hungry. And remember, the best time to start your own creator economy is today.
Action steps:
Further explore how the Web3 platform empowers creators.
Read more articles about social tokens and creator economic potential.
