Last week, global emerging music and technology conference, Mondo NYC was hosted in the Williamsburg Hotel with a full day agenda of panel discussions, speed meeting sessions, NY music industry meet-ups and more. Local musician and technologist Nathan Windsor attended and shared his key takeaways from the event.
Disclaimer: I’m a musician and I run a blockchain software company called Macroscape. I moved to NYC in 2006 to play music, wrote a rock opera, and worked as a music therapist. When I started to run out of money, I switched to software development and cryptocurrencies.
Now if you’re not constantly huffing the fumes of crypto-crack like I am every day, you’re probably not familiar with all the totally arcane and useless facts that I know. Luckily, someone compiled all the failed crypto projects in one place for you right here. Like, you probably don’t know that Ripple is a highly centralized database and most of its founders hold huge amounts of it. That hasn’t stopped it from raising an obscene amount of money (the current market cap is $28.38B), and people from bringing class action lawsuits against the company. As McCartney sang “will you walk away from a fool and his money?” You also probably don’t know that EOS took out ads for its ICO in Times Square, which violated US securities laws.
EOS and Ripple fit into the bucket of projects that have reached what I call “terminal financial escape velocity”: they’ve raised so much money that they can just pay off whatever bills the authorities throw at them. “Ah, who cares,” they probably think. “They’ll sue us in whatever jurisdiction, then we’ll confuse them with nuanced jargon, and pay whatever fee they want us to pay.” (think the FAANG paradigm…)
Getting back to the event of this article, Mondo NYC was created by Joanne Abbot Green and Bobby Haber, who were the also the founders of CMJ. Along with Northside Festival and SXSW, Mondo is another festival working to give musicians the exposure, network, and tools to make a living. Having attended many of these industry festivals over the years, I often come away with a feeling of “ok, so now what?”
I spent three hours listening to panel discussions on blockchain and the future of the music industry and while we are getting better at crafting tech solutions that “cut out the middleman”, we still have a long way to go. Many times in the age of the internet, we solve one problem and then create a whole slew of new ones.
Here are the dark secrets of the music and blockchain industries which no one wants to tell you, and which are symptomatic of the much larger issue of global wealth disparity and the coming AI technological revolution.
1.) Our culture does not understand how to use units of accounting to value the work of people who create “art” (music, performance, visual art). While we all believe the story that art is “valuable” or “unique” we simply don’t know how to assign these things value. That does not mean that we can’t assign it value, it means we don’t. Yet. The same applies to our other valuable assets like data and attention, which is why we give them away for free cat videos.
How will we assign value to music when AI creates more and more of it? And I’m not talking about the algos that created classical music that sounded like Bach by David Cope. Most people could not distinguish the AI-created music from actual Bach. I’m talking about when algos create music that sounds like Brittaney Spears. Or Tom Waits.
How will we value human-made music?
2.) Most blockchain projects don’t get adoption because people don’t understand what they hell we are talking about. When I say “people” I mean, those of us who are not crypto-anarchists or tech freaks. Even many “crypto-anarchists” I know in the blockchain space still don’t understand best practices of social engineering, password management, and VPN use. I’ve spoken to professional journalists who still don’t understand Civil’s TCR model. (Try googling it, you’ll see what I mean.)
3.) Most people do not understand private key management. (See #2 above)
4.) In crypto, we believe an unproved theory that as network adoption increases, the price of the token increases as well. This is what I call “The Moon Fallacy”, and Nathan Chen discusses it here.
5.) It is takes more time to read from the blockchain than to write to it. Which is why you cannot (currently) hope to host all of your music library in Ethereum and charge for access to it. (Vulcanize, Menlo, and RChain are trying to fix this.)
6.) Having creators adopt a token like Ether or bitcoin also has them adopt the volatility. And capital gains. And private key management. And a centralized service called Coinbase that is starting to look more and more like Goldman Sachs.
7.) How do you get crypto into the hands of people who don’t have cash (or crypto wallets) and not replicate the wealth disparity that we currently have in cash? We have no answer for this. (Hint: it’s the holy grail of crypto)
8.) Music blockchain solutions usually try to address the problem of “rights management”. But if the overall market is still so abysmally undervalued in our own contemporary markets, then trying to fight over pennies with crypto substitutes may actually be practically fruitless. This is not to say we should not try to “get up stand up”, but try to see the forest through the trees for a second.
The Music Industry is just not that big.
First of all, the music industry’s economy as a whole is just not that big when compared to the amount of people who create music, and even when compared to other types of markets. The cited figure puts the total music industry at around $16B, although Spotify’s execs report that it’s closer to $24B. In comparison, the global real estate market is $4263.7B. The world’s smallest national economy, Tuvalu, has a GDP twice the size of the music industry at $32B. Think about that how weird that is.
Drill down further into the fact that most of that music does not actually get to the people who create the music. This is why artists like Immortal Technique have for years decried the music industry in his music. From his song “Industrial Revolution”: “And now these parasites want a percent of my ASCAP / Trying to control perspective like an acid flashback … A&R’s tried jerking me, thinking they call shots / Offered me a deal and a blanket of smallpox.”
Then add “the industry”, the radio execs, “The Voice”, the people at the very top who still curate what most people listen to and get an enormous outsized say in the market. One of my favorite bands, Saves the Day, experienced this predatory curation when they got shelved by Dreamworks at the height of their career. “This doesn’t fit the format” they told them. “Cue the sound of my heart shattering,” says lead singer and songwriter Chris Conley.
From Will Page, Spotify’s director of economics: “When you factored in all the monies that flow to PROs, publishers and songwriters, they were much more neck-and-neck in true value than often perceived. However, how that money then flows from firms (labels, publishers and collectives) to individuals (artists and songwriters) is an entirely different conversation.”
Now anyone who has tried their hand at making music knows what I’m talking about. Or art. Or journalism.
So what’s this got to do with distributed ledger technology?
The companies like SingularDTV, Peer Tracks, Ujo Music, and Choon are all creating very interesting technology. Each company is trying hard to allow artists to sell and own their work, and I acknowledge their hard work and continued dedication to this vision of a new world. And yet we who are in the blockchain industry are all still missing the forest through the trees. If we recreate the inequities in our current system into crypto, then this will all be in vain.
As a tech nerd, I’m super excited to be working on the tech that we hope will decentralize and democratize the world. We have a responsibility now to look five or ten years in the future and try to create a crypto-system that uses financial derivatives to model and to value what the dollar leaves out of the market.
What that means in non-tech speak to quote James Brown: “Papa’s got a brand new bag.”