YouTuber Keith Wareing is charming, excitable, and exemplifies everything we love about the crypto community. In this interview with eMusic Head of Product Matt Robinson and CFO Michael Juskiewicz, Wareing gets down to brass tacks about our product and our vision for a sustainable music economy on the Blockchain.
Here’s what came up in conversation.
1. eMusic is a well-established company built on responsible music buying and dedicated fanship.
eMusic introduced the first digital download store back in 1998. Now eMusic is building an innovative Blockchain-based music distribution platform to enable artist to make money making music. We hear all the time from our customers that one of the reasons they use eMusic is that they want to be responsible and they want to buy my music in a way that has the biggest impact for artists. Or perhaps streaming just isn’t an option: “I live in the middle of nowhere,” said Keith, “I literally can’t stream anything.” Downloading can be a great way to solve both problems, and we’re proud to be the leading player in that marketplace. But the reality is downloading music has taken the backburner to streaming in recent years.
Amazingly, 60% of our users actually buy albums as opposed to just streaming or downloading a song, and these are the core users who stay with us to this day. We don’t want to change users’ behavior. We want give them complete choice in how they listen, while still supporting the artists.
2. Blockchain will revolutionize royalty payments
Watch the replay of the full interview on YouTube.
The big problem with royalties in music: sometimes an older song from a publisher’s back catalogue will appear on a streaming platform and suddenly gain an audience. The problem is, that artist may no longer be in touch with his or her label, or could be deceased. Who takes the artists’ share of the money then? Usually, when the rights holders can’t be found, the label will just keep the money. Blockchain provides a complete restructuring of this outdated practice, and also provides transparency with payments and immediate royalty payments for all artist. That’s just one example of the entire supply chain that we plan on building for the artist.
3. Labels and Distributors are taking more than their fair share.
Typically, labels take 70% of streaming revenues from a song. So while Spotify is really an incredible product — a working database for all of the recorded music ever created, tens of thousands of songs are reportedly uploaded every day — the distribution of revenues is something that needs changing. Their cost of product is very low. It doesn’t cost them any shipping or distribution to get the songs to their own platform. Obviously overhead costs are important, and royalty payments and such, but all things being equal, what are you really paying for? Most of the money paid for your membership to a streaming service goes into the pockets of labels and distributors, and that’s exactly what has to change.
4. Competition is shrinking in the streaming world and that’s bad for consumers.
“Yes, we want to serve our users who like to download to own their content,” said Matt Robinson, “but we also don’t want to foster this anti-streaming sentiment.” Spotify and Apple Music are both wonderful products and they certainly deserve praise for bringing the music industry to the place it is today. But that’s not enough: we’ve said before, Spotify is not showing the sustainability it once promised. Apple Music continues to shine, but only with the major power of Apple’s hardware business to bankroll it. Who is going to step into the marketplace and make magic happen for music?
“We want to foster an industry that allows for this competition,” added Matt, with an artists’ perspective. (BTW, did you know Matt used to DJ hard house music?) “As it is, the streaming world right now is headed toward this homogenized blob of nothingness.” Greater diversity in the marketplace will be better for consumers and creators alike.
5. eMusic will foster the world’s first “community label.”
Even if you’re new to the music industry, you probably know some of the things that labels do:
- Organize and execute contracts.
- Manage sales and marketing for artists.
- Procter relationships with distributors, publishers, and other service providers.
- Maintain back catalog.
- Manage distribution.
This is a simplified list (some labels, for example, do more and some labels do less). As a broad overview, it allows you to see the power of EMU, which can be utilized to make every part of this music economy run. This idea is maybe one of the more exciting aspects of our Blockchain pitch.
“If you think music is art just like we do, and you’d pay a lot of money to own a Monet or Degas, you’d also pay a lot of money to own a song by your favorite artist,” Michael said. The EMU treats a digital asset (the music) like a physical product, building a community and a marketplace for music that will generate revenue for years and years to come. In addition, EMU will allow artists exciting new marketing utilities: limited runs of albums, for example, or incentives for fan support. Kickstarter changed the game for fundraising in the arts, but now EMU takes the crowdfunding idea into the next phase: a digital world where music fans can form a community label.
6. The emotional bond between artist and fan is more powerful than any other relationship in the music business.
This is what we’ve said from the beginning and it’s what’s central about our distribution product. From the stories we’ve told on Medium, you can see that it’s time for big changes in the music industry: from Trent Reznor leaving his label, to our bid for the modernization of music. Our product will be the fastest way into the new music economy and we’re committed to making it the best. “We want make sure to ensure the right distribution for [the artists & fans] so that they stay with us for a long time,” said Michael.
With Blockchain, the possibilities are endless.
Hey! Our first-ever EMU Airdrop is currently taking place. Visit token.emusic.com and sign up to the newsletter to learn more, or follow us via Facebook, Twitter, or join the conversation in Reddit. Also, we're trying to get to SXSW next year. Will you help us out and vote for our panel?