New Blockchain Based Streaming Service — and It’s Owned By Its Artists
While doing some research on Blockchain I came across Resonate [Link ProductHunt] which is an upcoming streaming service based on a blockchain architecture. It might have the potential for a revolution in streaming on multiple levels:
- The core of Resonate is a scalable and performant blockchain database.
- It is a co-operative, co-owned by artists, labels and fans alike.
- It is pay-as-you-go. No subscriptions. No ads.
The number of supporters is growing daily. Right now, Resonate counts 781 artists and 105 labels. Artists include Imogen Heap, Meat Beat Manifesto, and Color Theory/Brian Hazard.
1: The Blockchain Database
Certainly it’s nice to see a music service that is not just talking about Blockchain but built on it right from start. Also, it can’t be compared to Benji Roger’s DotBlockchainMusic. Resonate is a standalone streaming service. Resonate is no effort to establish a new format. The more important fact is that the blockchain database being used is scalable.
What does that mean for the music industry?
With the mass of content in music industry, and in particular due to the amount of metadata involved in licensing, processing is a challenge by nature.
Who holds the rights? What’s the percentage anybody involved receives from the music being licensed? Which caveats are buried in the contracts of a track? With participants such as producers, sound programmers, lyricists, publishers, and composers for beats, rhythm, licks, hooks, melodies etc. who are eligible for varying fragments of payment, it takes a huge effort to calculate everyone’s claims.
Latency due to validation can be a road block
In Blockchain technology, the legal layer is processed automatically. At first glance, this is a great improvement. Often though, blockchain databases don’t provide enough „power“. Therefore, they are not capable of processing the mass of data. The power here refers to write access and time of validation (latency). The latency occurs when a new piece of information has been written into the database but still needs to be validated.
Resonate is based on BigchainDB. The developers of BigchainDB promise a much better performance — see their Whitepaper. In order to succeed in music industry, transactions involving licensing operations strongly require this improvement.
2: All Artists On Resonate Are Co-Owners of Resonate
Let’s get this straight: This is no Tidal. No „hey-we-are-stars-getting-it-right-now“. With Tidal, it is a handful of top-earning artists who are on the board. But I honestly don’t think that Jay-Z gives a shit what your three-piece act from German Bullay, Welsh Merthyr Tydfil or French Querqueville thinks about Tidal.
Peter Harris, founder of Resonate, used to design websites for music artists in the 90s when Jay-Z hadn’t any release out. Peter Harris is an artist himself, and it appears he really is motivated by the fact that the vast majority of artists are thriving to survive.
The collaborative and co-operative effort
The legal form of Resonate is a co-operative. All co-owners have a say, they all have one vote and equal rights — including Peter Harris himself. Hence, if you would like to get your songs streamed you become a co-owner first. It’s going to cost you a mere $5 per share.
In a blog article on the Resonate site, Peter describes the current „co-operative movement“ in more detail. One co-operative he missed to mention is Cultural Commons Collecting Society (C3S SCE).
The ownership of Resonate is split between musicians/labels (45%), fans (35%), and the Resonate staff (20%). Since Resonate is a for-profit organisation, profits will be distributed accordingly.
Blockchain technology can handle transactions securely. More than that, using Blockchain for transactions helps to process them much faster. Theoretically, this might lead to near real-time money transfers.
If you are an artist, and you want to know what’s going on, well, this might be an alternative.
3: The First Streaming Service To Make Money From As a Fan
As described above, fans co-own the platform as well as they can be members of the co-operative.
While this is quite revolutionary, there is another strategically more essential feature from a user’s point of view: There is no subscription. Despite of that it’s a paid service.
Pay-as-you-go and stream till you own
It is pay-as-you-go. For every listen to a song, you have to pay. While the first listen is very cheap ($0.002) the price doubles with each time you listen to the track again. Sounds unfair? I don’t think so. Because after nine listens you will have paid $1.022. After that, any additional listen of the same track is for free. Actually, you can even download the track.
If you listen to 30 songs a day, you are free to choose all new songs or more expensive songs. The latter are those you played more often and thus, they are more expensive before the 10th listen. So you might end up anywhere between paying 30 x $0.002 (= $0.06) and 30 x $0.512 (= $15,36) per day. In case it happens that all songs you enjoyed that day are ones you listened to 8 times before, you may listen to them for free any day after that. You own them.
The truth is in between
Usually, you won’t listen to that many songs a ninth time on one day that often. How often does it happen you are listening to the same two playlists or albums in their entirety each day within nine days? I guess that’s never. Let’s take Spotify’s Release Radar or Your Weekly Mix. I often do listen to them. But each day of the week, entirely? Never.
Yet I think the player should enable the user to set a certain limit of how much you are willing to spend that month. Otherwise, random play could dangerously force you to spend more. This depends on the quality of implementation for the random function. Actually, this is something I don’t like on Spotify. Too often it has the same artist in very short timeframe.
Resonate doesn’t lock you in
Resonate doesn’t keep the user tied because the music isn’t locked in. If you like your music that much you are listening to it over and over again, it turns into a download.
Other streaming services (and the labels and artists on them) run the risk of being ripped. Users can’t afford to pay more than one service just because of the artists they love most is on another service. This doesn’t help users nor does it help artists. Resonate streams and lets you own the music later. Legally. It is a stream-turns-download concept.
Support of new artists
The low entry level of pricing promotes listening to new music and new artists. This is great. I wonder why there are not more opportunities and business models based on that.
If you are a core fan you are supporting those artists the most who you love the most. Actually, the both of you can co-own Resonate.
Interestingly, other streaming services can’t pay an artist if his revenue is below a certain threshold. It doesn’t seem to be the same with Resonate. If the user pays Resonate then it depends on the label contract of course which percentage the artists receives — no matter how small the amount. However, the numbers are transparent. Any forthcoming changes to the business model or whatsoever have to be decided on by the members. No label can have a single impact strong enough to manipulate that.
Resonate is based on a promising and secure software architecture. Its legal and its business form is one that suggests to support artists, fans and curators best. The pricing strategy promotes and fosters culture.
There is just two issues.
The one thing is that I hope for enough artists to support it so that the pricing strategy works out. A model like that depends on a critical amount of content as well as on quality content.
More than that, can a service like Resonate survive with few „mainstream“ or big names? Looking at SoundCloud, it might work.
Let’s keep fingers crossed.
[Please note: I have not been paid for this article nor for any other work for Resonate. I honestly think any effort like Resonate should be supported. That’s why I help with promotion and networking.]