Until recently, musicians and film producers would release their works hoping piracy would not do away with all of their revenue. Then they would wait as publishers, distributors, YouTube, Spotify, collectives, etc. collected royalties, took their cut and then paid whatever was remaining to the musicians or film producers, often over a period of six months or more. Now, entertainment industry participants using “smart contracts” can avoid piracy and get paid almost immediately, including in cryptocurrencies.
A few examples:
- Music streaming giant Spotify recently acquired Mediachain Labs – a blockchain data solution for connecting applications to media and information about it;
- SingularDTV established itself as the first blockchain entertainment studio, laying the foundation for a decentralized entertainment industry;
- ASCAP (American Society of Composers, Authors and Publishers), SACEM (Society of Authors, Composers and Publishers of Music) and PRS for Music (UK music rights organization) initiated a joint blockchain project to improve data accuracy for rights holders in April, 2017;
- Cryptocurrency Monero launched “Project Coral Reef” which enables the use of cryptocurrency to purchase music and merch from such notable artists as G-Eazy, Mariah Carey, Toby Keith, Ministry and Fall Out Boy;
- Composers, musicians, labels, distributors, and indies are “chaining” their rights and being paid very quickly in cryptocurrencies; and
- For the film industry, blockchain technology presents opportunities for new and better ways to do business for all stakeholders, from global studios to independent producers and distributors to internet based content streaming platforms.
It is important to remember that properly structured agreements are required to provide the legal foundation for processes carried out by execution of the underlying computer code to smart contracts running on a blockchain, licensing rights to consumers and distributing payments to rights holders.
Blockchain data for a song can be a single place to securely and immutably preserve and publish all the desired information about who composed that song, the performers, the publisher, the label and what their related percentage interests are, all without having to rely upon a third party organization.
For film producers, the entire collection of rights, titles, music, technical design creations, licensing, characters, and even merchandise can be built right into smart contracts running on a blockchain.
Smart contracts and their data can be global, decentralized, secure, and permanent, capable of containing all the information an auditor or court would require. It is important to get things legally right from the beginning. The contract is the rights and the money!
Traditional film “chain of title” and other legal opinion letters are being amended for blockchain applications and E & O insurers. Music rights holders are beginning to require similar opinions. Smart contracts writing data into a blockchain preserve all the legally required information for every transaction, title and legal status, helping to prevent errors and disputes and increasing productivity and efficiency.
If your business involves digital assets or transaction data, smart contracts and a blockchain are in your future.