IndustryNov 17, 2021
Blockchain Use Case: Media & Entertainment
Applications for blockchain extend far beyond Bitcoin and cryptocurrency. Let’s briefly explore the relationship between the media & entertainment industry and blockchain.
Blockchain technology is dramatically changing the landscape of the media and entertainment industry. Historically, these industries have operated on legacy systems which suffer extensively from digital piracy, fraud, and copyright infringement. The artists are ultimately the ones whom suffer the most and have little to no say to about what is done with their work at large.
Blockchain’s architecture lends itself quite nicely to the issue of intellectual property (IP) infringement. Artists are able to digitize their content and store IP rights on the blockchain. Immutable in nature, blockchain’s append-only ledger provides a time-stamped record for creators to utilize should they have to contest the occurrence of copyright infringement.
In the case of the music industry, intermediaries run rampant. Fees are paid out to record labels, managers, publishers, distributors as well as the bulk of streaming services (think YouTube, Spotify, SoundCloud, Apple). At the end of the day, the artist only takes home approximately 12% of the revenue generated from their own work. Which still doesn’t account the instances where artists accuse streaming providers for not providing complete compensation and royalties are routinely missing.
Blockchain allows artists and creators to take back control over their work, how it is distributed, and how they are compensated for their contributions. The role of intermediaries becomes less relevant as tasks such as licensing, contracts, reconciliation, and issuing payments become automated through the use of smart contracts.
Shifting to blockchain infrastructure allows artists to register their property on a blockchain platform. Each transaction or usage of this content is recorded, date and time stamped to the blockchain in sequential order, enabling transparent tracking of the content usage in real time. Smart contracts can execute usage-based payments or micropayments, directly between the user and the creator eliminating the need for costly intermediaries and insuring immediate compensation for the creator.
M&E companies as a whole stand to gain enhanced data quality, increased trust, increased efficiency, reduced cost, and reduced fraud by adopting blockchain technology into their business models. Blockchain allows for micropayments and usage-based payments which gives consumers greater control over the content they are choosing to engage with without having to commit to streaming subscriptions and services. This customer-centric approach gives way to increased revenue streams and the opportunity to create innovative new models for sustainable growth.
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