Blockchain-based digital music platform, OPUS reports that the transition of royalty payments into blockchain can empower artists in the digital music industry by increasing their bargaining power asking for higher payouts compared to conventional platforms.
OPUS says that introducing blockchain to the digital music streaming services market can have potential growth. The blockchain-based platform highlighted that a shift to tokenized royalties can also substantially diversify personal portfolios of artists.
In recent years, there has been an increase in the cashflows payable on the grounds of royalty-related contracts in the entertainment and media industries. Fees for the use of intellectual property increased at an annual rate of 8.99% in 2017 and 5.81% in 2019.
Despite the dominance of mainstream platforms such as Spotify, Apple, Amazon, and Google, the report predicts that blockchain’s role in the music industry will be especially notable in emerging economies such as China, Brazil, India and Russia.
Asia stands out the most, as its royalty payments quadrupled between 2016 and 2017.
However, OPUS claims that the open-source decentralized music platforms should not just focus on increasing the musicians’ final share in the royalties, but on its applicable aspects of financial literacy.
The report further added:
“As this market is currently dominated by a few large players, there is a significant room for new platforms to change the way and amount of royalties distributed to individual musicians, podcast producers, and all other artists. In particular, the Blockchain is here to change the status quo.”