Rethinking the Value of Music in Web3

This is the second in a three part series on the broad topic of NFTs in the music industry: exploring the potential effects of NFTs on the cultural and financial value of music, look out for the third and final part of the trilogy on how NFTs can be employed in the larger project of archiving and reissuing. Read the first here.

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At the beginning of his landmark book Capitalist Realism, the late, great Mark Fisher describes the way in which capitalism has become established as common sense in the contemporary world. It's no longer just an economic system, but a whole system of imagination — an inescapable system for thinking itself. Capitalism-as-neoliberalism, he argues, has penetrated every facet of our everyday lives to the extent that we can't even begin to successfully dream up what an "alternative" might look like. 

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At the risk of overstatement, you could make the same argument about the music industry. It's hard to imagine a world where a song doesn't cost roughly $1 on Beatport or the iTunes Store, or where success isn't quantified by number of streams. Clayton Keener-Blaha, Head of Partnerships at the blockchain-based streaming service Audius, tells me over Zoom that it didn't have to be this way. The idea that a song should cost $1 was completely arbitrary — a way to quantify music that felt, to use his word, "digestible." 

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The advent of web3 presents an opportunity for alternatives that exist outside of this imaginary stranglehold but, in order to start thinking about music outside of our current model, we need to start thinking about the value of music differently. As cultural theorist and artist Mat Dryhurst wrote via email, the current model of the music industry has been designed for pop stars, not independent musicians. 

Both Dryhust and Keener-Blaha make it clear that this model of one-size-fits-all valuation is actively working against musicians, fewer and fewer of whom can eke out a living. Even a renowned platform like Bandcamp still institutes what Mike Pollard, one of the founders of Nina.protocol, describes as a "success tax:" Bandcamp artists give away 20% of their sales to support a platform in which they have no oversight or investment (as the recent merger with Epic Games underlines). 

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This is where there seems to be a lot of excitement in the web3 world, particularly in conversations around valuing music differently. "Music is priced on how much it is used," French artist Maelstrom says. "It means that the only music that is going to make any money is music that is easy enough to be consumed globally and constantly, but not all music is like that." 

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It has become dogmatic to equate these two things—use and value—but Maelstrom's idea is that this model doesn't hold water for all music. "Music that has the strongest impact on me, I can't listen to it all day long or even everyday," he says.  

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Maelstrom's idea of thinking about different music in different ways feels both radical and intuitive. We don't listen to all music in the same way so why should all music be valued the same? Maelstrom uses the art world as an analogy, suggesting that an increase in higher prices for something like an NFT might feel strange now, but there isn't any inherent reason why music should be priced homogeneously. In fact, a tool like an NFT is like the more extreme version of adding a record to your collection on Discogs, allowing listeners to flex their fandom in a tangible way that hasn't previously been possible in the digital world. And while the current conversation has often focused on the high prices of NFTs, paying more money for valuable art seems to be at the crux of a new valuation model for music. 

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Still, we need to tread carefully around discussion of NFTs as the future of value in music. As Pollard points out, over the past year as NFTs have seeped into the mainstream, the spotlight has been almost entirely focused on the high prices and speculative markets that have emerged. Pollard cautions against the idea of getting too caught up in music fetching Picasso-like prices by tech bros who have some ETH to play around with.  

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What web3 could offer is the chance to avoid rebuilding stand-ins for previous marketplaces. This is an idea that Dryhurst believes in vehemently. What needs to happen, he explains, is a rethinking of the possibilities of music at a more foundational level, particularly in the dynamics between the artist and the fan: "Perhaps the most important thing that needs to be focused on with regards to music and web3 is building new kinds of institutions that can represent artists in this new landscape, insulate the art making process from populist dynamics, and help artists to attune their practices to new audiences and habits." 

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Dryhurst is highlighting something salient in my conversations with people working in the web3 world. Blockchain technologies, so the line goes, can provide a way to build different types of relationships between artists and their fanbases. As the collective Water & Music put it in a recent report, web3 technology is "blurring the lines among artists, fans and contributors."

The rapper and head of community engagement at Zora, Latashá, is a case study in how this has played out. After ten years in the music industry, supplementing her creativity with a day job, she made the jump into the web3 world and has become one of the most successful artists operating on this digital frontier. As she explains to me: "In the Web2 sense you have to play in a box, but I am utilizing this concept of decentralizing myself in web3, allowing myself to be multidimensional, multifaceted, to show all of my aspects." By this she means that she has created a world of her art where at one end of the spectrum her fans can buy NFTs of her music videos on Zora (which can fetch upwards of 7 ETH) or, at the other end, fans can playlist her music on sound.xyz free of cost.

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Keener-Blaha doesn't hold back his enthusiasm for the business model that underpins Latashá's thinking, highlighting how to monetize "the bond between the artist and the fan." I'm sure I'm not alone in cringing at this. On the one hand, as a person who has always been a committed member of the underground, the idea of monetizing relationships makes me queasy. But, on the other hand, these relationships have always been monetized. The difference is that instead of some backroom payola, this is all being done in the digital daylight of the blockchain. "If you don't believe fans should pay for music, then you don't believe music is valuable," he tells me. It's hard to argue with this logic. Like OnlyFans or Patreon (Keener-Blaha reminds me that innovation begins with porn, then cats, and then finally music), a change in value comes from allowing musicians to upload their music and build a committed fanbase who, through the purchase of NFTs and/or other products, would be given access to exclusive features—whether that's music or interactions with artists. 

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This is what someone like Latashá is already doing in creating a larger ecosystem of ways for her fans to interact with her across different tiers. "An artist like myself is made for this space," she explains. "We already understood selling CDs from the trunk kind of vibes. We are now selling our art in a digital trunk, bestowing it to the highest seller." 

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While Latashá's analogy makes sense, it also doesn't totally hold up in the web3 world. When music was dominated by physical formats (e.g. CDs or records), it was easy to see why we paid relatively similar prices to buy music. The question that artists like Latashá are forcing us to ask is, why have we imported this homogenous model into the digital realm? 

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Part of the issue for her is the relationship between money and music. "At the root of it, the world has shaped our minds to be afraid of money," she tells me. "We are fearful of it, we are afraid of what we can do with it, especially for marginalized communities. Marginalized folks are afraid of what they can do with money. I am hoping that we can reshape that, even if it is a small amount of money that you put into something, something that you believe in, something that if you plant that seed, you might see something grow out of it." 

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Granted, conceiving of buying music as an investment requires a cognitive shift, but it also feels like a necessary one. What you are buying is something that doesn't have an endless reproducibility. While this can produce its own models of scarcity, the work that artists like Latashá are doing requires you to think about music ownership with a more acute sense of care and cultivation. There is an element of speculation built into this pricing model — speculation not necessarily (or exclusively) in terms of financial incentivization, but also as an investment in the future of artistic praxis.  

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There is no doubt in the radical potential in this model, but I keep coming back to the point that Jay Daniel made in our previous piece on the shifting perception of NFTs for musicians. Daniel saw the focus being placed increasingly on the context (i.e. the relationship) rather than the content itself (i.e. the music). I put this question to Latashá and she is quick to underline that it is not the tools themselves that are revolutionary, but how they can be used. She also explains how getting the chance to interact with her fans through these new tools creates a symbiotic relationship, pushing her to think about her art in different ways. 

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The historic music industry has created what Pollard describes as the artist-fan dichotomy, which forever keeps these two positions at arm's length. What he thinks needs to happen is a rethinking of this dichotomy. Although Nina.protocol is still in its early stages, there is a hint of the utopian in Pollard's words as he describes artists owning their own infrastructure as a countermodel to the hegemony of streaming platforms. 

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This is echoed by Keener-Blaha: "The grand promise of a decentralized music industry is that every artist becomes a streaming platform into itself." Latashá is already doing just this. There is an implicit understanding across her work that independent artists need to reclaim the means of production, wrestling away from the platforms both the top-down monetary models they have created and the types of relationship they have dictated that they can create with their fans. The building of bespoke models between artists and fans ultimately seems to be where the new model of value lies for web3 musicians: a multifaceted and evolving payment model to compensate multifaceted and evolving artists. If you can get your thinking past the $1 per song impasse, it also begins to make a lot of sense.  

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As the natural pessimist I am, I can't shake my fears about how easy it would be for these ideas to be co-opted by the nefarious (and often anonymous) bad-guy tech bros and venture capitalists that seem ever present in the fringes of web3 spaces. "Capitalist realism," the cultural theorists Joshua Schuster and Derek Woods write, "maintains the premise that all actually existing utopias as well as all utopian imaginations always collapse into dystopian regimes." 

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A fear of the dystopian is something I also hear in my conversation with Pollard. Pollard keeps returning to the term "community" but understands how quickly that egalitarian promise can slip into a hyper-capitalist dystopia (think Marks & Spencer's LGBT sandwich). Community has become a sort of catch-all term to describe people who are merely messaging each other on Discord while trying to grow the balances in their respective crypto wallets. Pollard is adamant, however, that community is something that can be achieved through web3 tools. In fact, it's the crux of creating exciting art. "Music scenes," he tells me, "are not purely financial. Community is the basis of where new music comes from." 

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In our final piece in this series, we will return to this idea of community to look at how web3 tools are navigating what we understand as community in underground music. Latashá will be performing June 22rd at ZeroSpace for Refraction's series of NYC events. RSVP here.