Sammy Baker

How NFT is Working Towards Shaping the Future of Music

May 9, 2022

NFTs have been the topic of discussion for some time now and it should come as no surprise that it is gradually shaping the future of music and the music industry as we know it.

The token is quite flexible and capable of representing a variety of real-world items digitally ranging from music to images, video games, art, etc.

All these have culminated in NFTs amassing a total sales volume of $25 billion in 2021 and are expected to reach $35 billion in sales volume this year.

Moving on, let us take a look at what NFT has to offer in the future and what this means for the future of music.

A look at NFTs

The Future of Music

NFTs are non-fungible tokens that represent digitally, real-world items in such a way that every piece of these items is unique and are impossible to duplicate.

Most NFTs were built using the Ethereum blockchain as such there is every tendency that the NFT you own or have probably seen is an Ethereum-based NFT.

In terms of prices and value, NFTs have seen quite an amazing share of both. As the digital asset has recorded world-breaking prices with Pak’s The Merge being the most expensive NFT ever sold at $91.8 million.

These prices are judged mostly based on the buyer’s view of their value as most NFTs tend to have sentimental values towards these assets while some typically buy them at outrageous prices simply for bragging rights.

NFTs and the Music Industry

Future of Music

When it comes to the music industry, it becomes obvious that NFTs are very much capable of transforming the industry entirely which is no coincidence that a good number of celebrities who own these NFTs are music artists.

Right now, audios, songs, lyrics, and even soundbites can all be transformed digitally into NFTs which is why music artists are taken a particular liking to the digital asset.

Kings of Leon even released an album called “When you see yourself” as an NFT which was the first album NFT to be created.

The album came in 11th place on the Billboard 200 and took 2nd place on the Top Rock albums chart.

With the introduction of smart NFTs, capable of supporting various music formats, music NFTs can now be displayed in various means, for instance, an audio NFT can now be displayed alongside its lyrics included in a PDF format.

Looking at all of these, it is nothing short of obvious that NFTs are destined to have a major role in the world of music.

NFTs and Compensation in Music

We all know that a major problem facing musicians in the music industry is the fact that they hardly get compensated for their work when due and with the right amount.

As reported by Fortune, the typical total revenue split is 50/50 with only 50% of revenue going to the entertainer and the rest shared among agents, lawyers, and distributors.

The reality is even more disappointing when it comes to musicians who distribute their content via streaming services. Most of Spotify’s top 0.8% of artists earn less than $50,000 in streaming revenue.

In addition, most musicians tend to relinquish ownership rights to certain platforms who then proceed to share their contents without their knowledge and some in the process get owed huge sums of money in royalties that they do not even have an idea of.

Thanks to NFTs, these challenges may no longer be a problem as the digital asset is more than capable of ensuring that musicians do not have to relinquish their ownership rights except if they choose to when minting NFTs.

Also with NFTs, music artists can sell their work without fear of not being compensated fairly.

It even becomes much better when these artists realize that they can sell their work and in turn get royalties each time the new owner of the work decides to resell it and so on.

These are just some of the benefits NFTs are bringing to the music space and why it is even more important that artists today, begin to make use of these digital assets as often and as much as they can.

Investing in Music NFTs

The future of music

This is also another way NFTs are laying the paths for the music industry as not only can musicians benefit from this asset, but even collectors looking to make some profit, can take a share of the cake as well.

When deciding to invest in NFTs, it is important to note that certain fees would be incurred especially during the minting process which is why it is important to look at pieces of music that are unique before investing.

Take, for instance, vintage art is highly valuable not necessarily because of the creativity behind the piece (although that is important) but because of the uniqueness of the piece in question.

In that same vein, rare music pieces such as a vintage vinyl records with very few copies made are sure to command high values and yield considerable returns in investments as well.

Bear in mind though, that the forces of demand and supply are what are important if you are to make a return on any investment in music NFTs which is why emphasis was laid on rare music pieces.

Nonetheless, investing in music NFTs isn’t for every investor and due diligence should be done before any move is made.

Artists looking to follow this path as well should also do well to weigh the merits and demerits before doing so in order not to lose invested funds.

How NFT is promoting Collaboration among Artists

We all know that music collaborations are a common occurrence in the music industry as has been done time and time again.

With the introduction of NFTs, artists can better work together to create something beautiful using NFTs as the foundation.

For example, Grammy-nominated DJ Steve Aoki recently teamed up with digital artist Maciej Kuciara to release an NFT collection.

As Kuciara has reflected, “NFTs represent a new canvas for digital artists, that allow a whole new generation of artists to collaborate with talent from different industries, and leave a lasting emotional impact on the viewer.”

With NFTs, collaborations can become more lucrative as musicians can opt to bake a royalty-collection mechanism into the NFT. 

In addition to collaboration, NFTs can also be at the forefront of music remixes as musicians can make this happen by making use of what is popularly known as upgradeable NFTs.

As digital agency Blue Manakin has explained, “Upgradeable NFTs open the possibility of more efficient distribution of music, that does not have to go through intermediaries and that facilitates the creation of exclusive material, collaborations, and remixes, without the legal implications that often arise.” 

Upgradeable NFTs are NFTs that can evolve and mutate over time.

For example, an artist might release a soundtrack, a chorus, or a bridge that fans and collaborators can legally build atop while bypassing the costly legal processes often involved in legally creating remixes.

With upgradeable NFTs, the original creator can retain control of the spin-off creation and even profit from it.

More Insights

With NFTs, the opportunities for appeals to scarcity are limitless.

Consider the world’s largest music event organizer, Live Nation, which launched at the end of 2021, Live Stubs, NFTs that fans will receive for free when they purchase a concert ticket.

As Michael Rapino, President and CEO, of Live Nation Entertainment, explained,

“Our Live Stubs product brings back the nostalgia of collecting ticket stubs while also giving artists a new tool to deepen that relationship with their fans and we can’t wait to see what the creativity of this community dreams up as it grows.”

Over time, Live Stubs and similar NFTs become rare collectibles that can appreciate over time in value and be resold legally. 

Other appeals to scarcity within the music industry have also been enabled by NFTs.

Canadian singer Shawn Mendes has collaborated with an avatar tech company, Genies, to launch his own NFT.

Launched on OpenSea, the NFT included rare digital versions of his signature accessories such as his Fender guitar and gold ring.

Final Note

It is obvious from the events surrounding NFTs that it is definitely here to stay and won’t be leaving any time soon.

Today, NFTs have impacted and are still impacting the music space in more ways than we know which is why soon, music as we know it will evolve even further to achieve new heights.

Also, due to its impact, several artists are now beginning to take a chance with the asset.

For example, creative music producer 3lau, who sold 33 NFTs on the third anniversary of his album, sold Ultraviolet for over $11.7 million, making it one of the largest music NFT deals.

3lau has even been contemplating allowing the NFT owners to collaborate with him on the net song and perhaps even be featured in the song.

Moreover, there are recent instances of artists contemplating transforming paparazzi photos into NFTs so they can make profits from them in the form of royalties.

These applications of NFTs have the potential to transform the music industry into a level-playing field for all artists.