As the music industry adopts new technological solutions, the tracking and distribution of song usage continue to pose significant challenges, with a lack of transparency and accuracy that can result in copyright owners missing out on royalty payments from various mediums.
Blockchain technology has the potential to radically change the manner in which the links between International Standard Recording Codes (ISRCs) of music recordings and International Standard Work Codes (ISWCs) of music works are tracked by improving royalty matching processes, which could ultimately reduce errors and increase the speed of payments to copyright owners.
In an effort to achieve this goal, music collecting societies ASCAP, SACEM and PRS for Music have entered into a partnership to "prototype a new shared system of managing authoritative music copyright information using blockchain technology.” The three collection societies are working with IBM to leverage open-source blockchain technology from the Linux Foundation, Hyperledger Fabric, to more effectively determine the correct ownership information of music by adopting a shared, decentralized database with the ability for real-time updates and tracking capabilities of musical work metadata.
The massive growth of music streaming has increased the complexities of the already arduous task of tracking and distributing royalties to copyright owners. The ability for blockchain technology to manage records without centralized governance has already proven to be very effective in payment systems, and this exciting new initiative could dramatically improve music copyright management in the future.
Achieving increased transparency and accuracy of royalty tracking and distribution with blockchain technology will be beneficial to many segments of the music industry, allowing copyright owners to receive fair compensation for their work while reducing operational costs for collection societies by streamlining processes.
As we discussed in a recent article, several other players have created strong partnerships in their attempts to develop new methods for music copyright management, including DotBC (dot Blockchain), Digital Data Exchange (DDEX) and the Open Music Initiative (OMI). Although the approaches vary from creating a new file format for digital music distribution (DotBC) to standardizing the digital supply chain (DDEX), all of these initiatives have the same ultimate goal to develop a standard that will be adopted by the entire music industry.
It's really difficult to know how this will all turn out. However, it's clear that blockchain technology could hold the key to a radical transformation of royalty tracking and distribution processes, leading to a global standard that reduces the complexities and improves the accuracy of managing this essential aspect of recorded music. At DataArt, we continue to explore these emerging technologies to develop innovative solutions that make the music world a better place for artists, fans and industry alike.