How Blockchain Can Transform the Creative Industry?

Blockchain technology, the underlying system that makes Bitcoin tick has been the hottest buzzword in the tech space in recent times. Poised to revolutionize each and every industry, this ingenious technology is a distributed and decentralized ledger of transactions that removes the socioeconomic barriers. Its theoretical immutability, mass collaboration, versatility and clever code hold greater potential to bring changes and make processes smarter. Blockchain technology has been making its way into a lot of industries such as finance, healthcare, law, education, governance and beyond. Anything and everything that can be interpreted in code and of substantial value can be programmed into this digital ledger. And the unique characteristics of blockchain makes it a perfect technological solution for creative industries such as music and publishing. Right management for intellectual property (IP) and artistic works have always been a challenging and incredibly complex issue in the creative industry. Having blockchain to record and store authentic information about individual pieces of content within a peer to peer network may prove highly beneficial. In this blog, we will explore the potential applications of blockchain technology in creative industries.

Protection of rights

Art forgery is a growing problem that has been costing collectors billions of dollars every year. In fact, it is the second-largest unregulated market brimming with fraudulent activities and wreaking havoc throughout the market in the last couple of years. When a painter or musician creates a piece of art, they toil hard and put in a lot of effort for creating masterpieces. Most often, artists inscribe their signature to the paintings to prove their ownership. However, it is quite easy for the fraudsters to fake signatures and create forged documents of provenance. That is why artists need a secure technique to protect their artworks and earn from it. The technology should be immutable and transparent to avoid any sort of tampering and unauthorized access. Introducing blockchain as an anti-counterfeit solution to fight art forgery issues would be an ideal choice. The basic concept of blockchain technology is based on recording and storing the records in a distributed and decentralized ledger along with a perfect audit trail of all transactions. When a record or digital asset is saved to the blockchain network, it would be immutable and secure. So when we apply blockchain technology in music and arts, it would help in establishing the authenticity and authorship of records. Moreover, it establishes trust and higher standards by guaranteeing the provenance and authenticity of artworks.

Monetization of artworks

Copying the artworks and using it without permission, attribution or payment is a common issue nowadays. Not only does it steal away the hard work, effort and skills of artists, but also deprives them of their financial gain. Whenever a painting is sold or music is downloaded, the original creator should receive royalty payments and fame. Deploying blockchain technology would help in establishing a transparent and secure royalty system that eliminates the middleman. Smart contracts can be introduced to secure the copyrights and monetize the artworks accurately. Blockchain based smart contracts are digital contracts that run on computerized transaction protocol supervised by a number of nodes connected to a blockchain network. Since blockchain contracts work on a decentralized system between all permitted parties, it can self-execute and self-maintain thereby eliminating the need for intermediaries such as lawyers or notaries. In contrast to the traditional systems, smart contracts are transparent, traceable, secure and irreversible which is why the creative industry can use it to dispense micropayments automatically and instantaneously. Snippets of creative works could be sold for a price. For example, a film production house can purchase the royalty for a few seconds of a song and use it in their trailer. This kind of micro-metering or micro-monetizing would help in leveraging the smallest consumable unit of creative contents.

Redefining remuneration

The monopoly power of intermediaries can be identified as a critical issue in the art industry, as artists often receive smaller slices of revenue for their masterpieces. Most of the creative works are priced, distributed and advertised by the third parties, thus taking away a huge share of revenue from its owners. Moreover, the artworks are often mispriced due to the transaction friction and rights management issues. Blockchain technology could create a direct creator-to-consumer network, thus eliminating the intermediaries from the supply chain . Not only would it help in improving the financial stability of artists, but also cuts down the overall costs for the consumer. Furthermore, it is possible to track and analyze the demand for creative contents so that the prices can be set to dynamic. Attaching a smart contract to an artistic piece of content would help in redefining the remuneration procedures.

Blockchain holds an enormous potential in breaking down the darkness and complexity surrounding the art and entertainment industry. Artists such as Imogen Heap and Zoe Keating have been advocating for the blockchain adoption in the music industry. In fact, there are a number of startups that have been using blockchain to transform the art industry. Some of the names include, but not limited to Fresco, Artory, Verisart, Blockchain Art Collective, Ink Labs Foundation, YAIR - Your Art is Reality and Portion. Immutability, transparency and accountability of blockchain technology would help in creating new business channels and make the fine art more accessible to a broader fan base. However, it is equally essential to consider its limitations and develop the blockchain applications within the regulatory frameworks to avail the maximum benefits.

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