The current NFT furor is partially fueled by early crypto buyers converting virtual money into something that might retain value better: art. This has been the case pre-Bitcoin, as this BBC article from 2017 about traditional art investments points out well:
“As art has no correlation to the stock market, it means paintings can go up in value even when the market crashes, making it a good diversification for an investment portfolio.”
One of the reasons why people are excited about blockchain is the fact that it allows for further decentralization of the web. Whereas the ‘web 2.0’ focused on feeds, social data, APIs and ultimately led to the creation of mega-platforms, discussions around the current ‘Web3’ tend to focus more on protocols, not platforms. That’s exciting, because we’re discussing the building blocks of the next generation of connected applications and their infrastructure.
One of the concepts the Web3 enables is the ‘internet of value‘: an internet where anything of value, from money to intellectual property, can travel as fast as information itself. Currently, transactions of money often flow slowly since they move through centralized bodies (hello, last year’s royalties) and that’s exactly where technologists hope to reduce friction.
This is also why there’s so much talk about trust. Systems, and the networks that support them, need to carry a certain legitimacy for people to adopt them.
One of the most exciting developments in the internet of value, and one that may shape fan culture for the next generation, is that of social tokens. Oversimplifcation: a creator of music sells ‘tokens’ to a community of fans, in order for those fans to unlock perks. These tokens become more valuable as the creator becomes more successful. If you thought BTS fans were everywhere already: just imagine a scenario where they’re holding tokens and the more popular BTS get, the more valuable their tokens get.1
Here’s my concern, though:
Many of these communities (and economies) are currently designed in a way that you have to buy yourself in by converting cryptocurrency into tokens or earn your way in by creating value for the wider network. The latter phenomenon can be seen in ad-free free-to-play games like those of Supercell, where the majority of users create valuable context for a small minority of users to spend their money. After decades of creating value on other people’s platforms and then having to pay to reach your own audience (e.g. Facebook), the token model is a very welcome change – but how do we make it inclusive?
Not everyone is able to buy themselves in early. While it’s true that you don’t always have to buy yourself in, e.g. in the case of Audius airdropping tokens to its users, the amount of effort required to earn your way in later on may increase with the value of tokens. Yet it’s not exactly about effort.
The goal is typically to make sure that those that provide an adequate amount of value to the network or platform get a token, so they can share in the overall value of the network. Kind of like getting a share in Facebook for posting cat pictures that get tons of likes (or your own music). However it’s not just a share: tokens often represent access. Access to communities, access to voting on the future of the network, access to features or perks, etc.
Tracking value
For the sake of inclusivity, it’s crucial that such systems accurately track and compensate value creation. But value is abstract, as anyone familiar with discussions about the value and price of music will know. Unfortunately, many systems are set up with the assumption that all value will be fairly compensated. While I admire the idealism and drive behind them, it does mean that people will be left out – either because they can’t afford to buy themselves in, or because they don’t get awarded a token for the value they create. For example, the person posting cat photos in the above example might get a token, but the people who took those photos don’t get anything.
The NFT market currently also has this problem, with minting fees being a barrier to entry to many artists who can’t afford it. This is an issue that’s being addressed, but for the time being it can be prohibitively expensive to mint NFTs on some of the more popular blockchains like Ethereum. Meanwhile, theMint Fundis a great example of an initiative that helps artists fund their NFTs, placing emphasis on the underrepresented.
Without taking these exclusionary issues into consideration when designing systems, we risk the next generation of internet culture to be one of currency and speculation. An internet where people with less money (fiat or crypto) get locked out or have less power over the platforms they use, despite perhaps creating more value that can’t be translated into currency.
That’s possibly still a step up from the internet of extractive megaplatforms like Facebook. Plus, if a platform or community decides that’s actually the way they want to work, that’s fine. However, there are a lot of instances where this is not an explicit decision, but rather something that’s believed will be resolved in the future through improvements in technology.
We messed this up with the web 2.0, where the promise was an interoperable internet, but we ended up with an internet where a few platforms extract value from everyone at the cost of privacy and the value of content. 20 years later, we have another shot at this. Let’s get it right this time. From the start.
A couple of weeks ago Bas wrote about AI music stars. Discussions surrounding virtual stars focus mainly – what’s in a name – on the virtual. But what if they had an actual footing in the real world?
Step in Boston Dynamics. If you hadn’t heard of them yet, you’ll probably have seen this video over the past holiday period:
It’s great, it’s catchy, it’s eerie, it’s a feat of engineering.
“Each owner served its function for the company’s bottom line — Google offered resources for exploration, SoftBank compelled it to productize and Hyundai will deliver the sort of engineering and manufacturing know-how required to scale up its products.”
The whole idea, it seems, is to be able to utilise Hyundai’s robotic production lines to step up the commercial path to profitability for these types of robots. Currently, Spot costs around $75,000. Of course, Spot looks cool on YouTube videos but it’s not really much more than a walking camera. With Hyundai, development could move much faster than before. And the question arises: what could robots do that will help propel them into the mainstream?
Back in 2019, a couple of South Korean students landed a little bit of internet fame with a set of robots they developed that mimicked well-known dances by members of BTS.
Kids from So. Korea built these robots w BTS moves. They are toys now but these young engineers hope they will one day become friends or life savers to aging people who live alone. The boys have a booth at UN Civil Society Conference at Salt Palace. Event open to public pic.twitter.com/PNCUso9Cu2
There isn’t a lot in the world right now that has more pop-cultural clout than BTS and K-Pop in general is in a strong moment. And BTS has been experimenting with creating experiences that allow their fans to experience something virtual in an offline real-life environment. Their pop-up showcase launched in Seoul last November was, according to Big Hit Entertainment, a preview of the online store, which is available in the Weverse app (both the pop-up showcase and the online store are available until 24 January if you’re keen). The South Korean connection makes a collaboration between Hyundai, Boston Dynamics and a K-Pop band like BTS not unimaginable. What would it look like?
Avatar-like robots that can act like BTS band members, or perhaps even start their own idol-type group.
It could be as simple as making the robots a part of the band, added in first instance as a kind of dance crew.
More interesting perhaps than matching the robots to a real-life group such as BTS is to match them to a mixed real-life & virtual idol group such as Aespa. In that case, the robots can truly become an extension of the virtual domain in the real world.
None of this will probably happen soon, but it does suddenly feel a lot closer. Virtual and real-life actors continue to mingle as fans experience music as much online as offline. Adding robots into that mix could be a way to bridge worlds. Of course, it can be a creepy experience. Where BTS can hardly do anything wrong, both offline and online, Aespa is much more divisive. Robots look cute when they’re doing some rock ‘n roll dances, but different responses will be evoked if we interact with them directly and ascribe them more anthropomorphic qualities.
MUSIC x focuses on long-term thinking about music & surrounding industries, so instead of looking back at the year we’re taking a look at trends we expect to be influential in the coming months with regards to tech, the pandemic, and sustainability. Here’s what to watch out for in 2021.
This article is jointly written by Bas Grasmayer and Maarten Walraven-Freeling.
Tech: Scarcity
Music was once a scarce good; the only way to experience it was live. Throughout the twentieth century technological developments have driven music from scarce to ubiquitous:
The inventions related to recorded sound go back to the late-nineteenth century and the patent for the first gramophone disc stems from 1887. It wasn’t until the 1920s that recording techniques changed to make it easier to record music and this helped the spread of music beyond the live experience. It also spurred on the music industry as we know it today.
Moreover, the 1920s saw the advent of radio which brought recorded music into most homes. Not only did this broaden the scope of the audience for music, the medium also influenced the format of music itself and the popularity of it and its performers. Fan culture was born.
Of course, radio was thought to kill the phonograph industry. But it didn’t. The equipment used for radio broadcast helped to improve recording standards for music and with it the sale of records which doubled from around 100 million in 1921 to 200 million in 1929.
We jump to the 1950s and the rise of television and film. New opportunities first and foremost for composers and musicians to find new revenue streams. But, of course, this new medium was thought to kill the old radio industry. Again, it didn’t. Fan culture got a massive boost.
1999, Napster. The internet did actually nearly kill the recorded music industry. Suddenly, all music was available for free at everyone’s keyboard-fingertips. The response? All bets on ubiquity: From the failed early experiments of the major labels through YouTube to Spotify. Music is everywhere and we, the listener and fan, expect to have it all, always.
For more than 100 years the music industry has been on a wave towards ubiquity with technological innovations as a catalyst forever thought to do more harm than good. Moving into the third decade of the twenty-first century, in order to maintain growth, we’ll need to jump on the scarcity wave.
Where to find scarcity?
How many people, publications, musicians, labels, etc. do you directly support? How many in 2018? How many right now? It’s likely you support a few and that this number has grown in the past three years. To keep you supporting you’re usually given access to exclusive content. In other words, exclusive content = stickiness.
This year, the virtual Music Tectonics conference provided a couple of days of being online together with some of the frontrunners in music and tech and you would have been forgiven if you came away thinking direct-to-fan is what everybody does. This isn’t true yet, but it has grown significantly in 2020. Three things to keep an eye on:
Equity investment
From major players such as BTS’ label Big Hit Entertainment going public and the ARMY taking a stake in their own fandom to something like Bumper Collective which allows fans to buy a stake in the future royalties of their favourite artists’ music. This investment idea – and subsequently the idea behind all the major catalogue acquisitions of 2020 – comes from the belief that the music streaming economy will grow. More and more people will become a part of the music industry of ubiquity, but that also provides opportunities around the scarcity of ownership.
Non-fungible tokens
In our recent update on blockchain in 2020 we dove into so-called ‘NFTs’. One week later, a digital artwork by Beeple sold for $777,777 on Nifty Gateway, a platform that makes it possible to own digital goods, making them scarce again. Days later, rapper Lil Yachty sold a digital collectible for $16,050 through the same platform. While earlier auctioned collectibles relied on being physical, such as the infamous single-copy Wu-Tang Clan album purchased by Martin Shkreli (the story of which is being turned into a movie on Netflix), the phenomenon has now gone digital.
Gated content
When Cardi B signed up to OnlyFans earlier this year, she announced it would be a place for only her and her fans. While doing stuff out in the open may get you fans and makes it easy for people to spread the word, gating content allows fans to feel like they’re accessing or are part of something special and helps the artist feel like they’re talking to their ‘true fans’. Cardi B and OnlyFans are far from the only examples. Membership models are rising in popularity through Patreon, Substack, and good old YouTube, among many others. If 2020 didn’t do so already, 2021 will see membership access models for artists go mainstream.
The pandemic and the enforced lockdowns have accelerated many changes that were already bubbling right underneath the surface of the music industry for years. None of these accelerations went faster than with livestreaming. While the live music industry was decimated, livestreaming took centre stage. At first most everything was free and poorly produced but that thankfully changed and we’re now faced with ticketed events of high production value from major artists like Dua Lipa, Billie Eilish and BTS. Similarly, there are artists who started going live often with good productions and on a subscription basis (exhibit A being Melissa Etheridge) leaning hard into their superfans. Meanwhile, the return to live seems to creep further into 2021 as we flow from lockdown to lockdown. With the vaccines, there will surely be live concerts as we head into the second half of 2021 but how will they be organised? Thus, the double-headed beast of live, streaming events and in-person events, is the trend coming through pandemic 2021.
The livestream will develop into an ever more interactive medium, both for fans and artists. There will be more productions that will include elements like BTS’ geotagged lightstick, the ARMY BOMB, during their Bang Bang Con virtual concert. Similarly, the way Billie Eilish provided engagement even the day before the show and pulled up 500 fans during one song as they were watching from behind their screen will be further developed to enhance interactions between artist and audience. Once live music returns these livestream events will remain a staple of the touring artist. Take, as an example, the Genesis Reunion tour, postponed twice due to the pandemic and now scheduled to start in April 2021. Let’s imagine for a moment this tour will go ahead, but the band has no interest in touring beyond the UK and Ireland. One full month of touring and most of the world is left without an option to attend. They can decide to bring a full camera and production crew to one of their gigs and film the whole thing as is. The other option is to take one extra date, create something more interactive and bring that as a live event around the world. Instead of 18 months of touring the globe, the band can perform once and ‘tour’ from one geofenced url to the next. This will be attractive to artists not eager to tour full time and to fans who are traditionally in geographical locations where most touring musicians don’t visit.
Pandemic, or even epidemic, in-person concerts will see new hygiene regimes enter the everyday vocabulary for concert- and festival-goers. We’ve reported before about the scientific trials taking place in Germany, the Netherlands, and Spain, among others. What these show is that a combination of rapid testing, staggered entry, mask-wearing, ventilation, and protocols pertaining to movement will become normal. You won’t have to decide whether you want to watch the support act, instead you’ll arrive at a very specific time to be able to enter a venue. Tickets will become just that little bit more expensive as the cost of the rapid test will be included in the price. It will be a long slog and hard work to put these types of events on and to attend them, perhaps also to perform them.
And, of course, tours could get cancelled. How the risk of cancellation will be attributed will be a spearpoint for 2021: artist, promotor, venue? What role will governments play? One of the reasons everything has been postponed is that this has deferred the losses that would have come from cancelling. At what point, however, will it become impossible to postpone a tour – again? As these risks become real as the year advances more governments will step in to make sure venues, promotors and artists alike will feel safe to plan events (Germany leading the way again). This type of risk deferral will look different for major artists and companies like Live Nation and AEG than for smaller artists and independent venues and promotors. The former rely on more long-term planning and have access to different types of funding (see AEG’s staff cuts and its owner’s loan). They will certainly be able to hold out one way or another until live and in-person events return. Smaller artists and independent venues will depend more heavily on support structures, both from governments and fundraising activities.
Sustainability: think local
European Commission Executive Vice-President for the European Green Deal, Frans Timmermans.
Will sustainability be on anyone’s priority list in 2021 as many feel they’re making up for lost time, and revenue? Hard to answer, but it absolutely should be as our environmental crises are of an order of magnitude disproportionate to one pandemic. No music on a dead planet, as they say. Before the pandemic broke out, climate and the environment in general had a lot of momentum as topics in popular culture. This was, in part, due to movements like Extinction Rebellion and Fridays For Future, the latter of which spawned movements of school kids protesting weekly in countless cities all over the world. The latter has largely moved their protests online, while also trying to figure out pandemic-friendly protests offline that can easily be amplified through social media. While this cultural force has become momentarily less visible, it’s ready to mobilize as soon as it’s possible again.
While you can find an overview of initiatives and resources regarding this topic on MUSIC x GREEN, what we think you should be watching out for next year is the following:
Regional collaboration between the music sector, government, and other industries.
In many countries, but more specifically cities, we’ve been seeing various levels of cooperation and coordination between the music sector and (local) governments & institutions. This can be over restrictions and limitations, corona-proofing venues, scientific experiments, layoffs & furloughing, or bureaucratic aspects like insurances and cancellation. This relation should be preserved coming out of the pandemic in order to drive positive change around music & sustainability.
A prime example of this is Massive Attack’s work on decarbonising live music and coming to the conclusion that the primary partner for this are cities, rather than promoters or venues, because it’s about transport infrastructure, power, and waste. For this type of innovation & problem-solving, live events can be useful trials (as we’ve highlighted before). This echoes some of the thoughts put forth by Shain Shapiro, founder of Sound Diplomacy. In a multi-part series, Shapiro points out new trends in localism such as the 15-minute city and the fact that the music sector is as organised as it’s even been. Those are two very important ingredients to actionable change. While change is also anticipated in other areas, such as more artists employing more circular models for their merchandise, 2021 will be a year of disruption with a local focus being an easy way to counter risks, and an important opportunity for bringing about sustainable change.
