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In the last two years, NFT and metaverses have started a revolution in the music industry. These technologies have introduced a new way for artists to earn and for listeners to enjoy live shows and freshly released albums. You may have heard of a Travis Scott metaverse show that attracted over 27 million users and an NFT collection by Grimes that raised $5.8 million in 20 minutes.
Many believe that metaverses and NFTs are to reshape the music industry. Let’s see how they work in the art world and what their perspectives are.
For decades, music has been evolving hand in hand with technology. From vinyl to Spotify, technical solutions have played the key role in how music is created and distributed. NFTs and metaverses are another step in this evolution.
What Is the Metaverse Revolutionary?
A metaverse is a combination of a physical and virtual worlds that let users interact through avatars. It brings together the VR and AR technologies and is considered by some as the future of the internet.
Metaverse reshapes the way we socialize — it puts real-word activities in a 3D virtual world. It’s a place where we shop, work, and attend events with friends while being miles away from home. A metaverse is a layer over our normal reality.
Art is a domain that has been affected by the metaverse, too. As the pandemic broke out, musicians started to seek alternatives to the way they make music and recite. In the first months of 2020, some artists arranged their concerts on social media like Facebook and YouTube, but that was considered a questionable alternative to real-world events. This is where metaverse comes on stage.
Metaverse Events
In April 2020, an American rapper Travis Scott ventured to arrange a virtual concert in a shooter online game Fortnite. It attracted 27 million listeners and was called historical — thus setting the scene for the music industry in the metaverse.
The concert was being prepared for several days, and enthusiasts could watch the backstage live on Fortnite’s Sweaty Sands beach. When the event was over, many said it was even more grandiose than it could be in real life — colorful, surreal, stunning. Metaverse features allowed for such visual and musical effects.
Travis Scotts’s performance wasn’t the first one of its kind. A year before, an American DJ Marshmello had already performed in Fortnite attracting 10.7 million viewers. But Scott’s show was the one to start the revolution.
After his concert, Ariana Grande jumped on the bandwagon and performed live on the Fortnite’s Rift Tour — a show that lasted for several days and had 78 million users. The event also boasted surreal visual effects and a few mini games.
Such a success inspired others to explore the metaverse as a place to engage with their audiences. Currently, a hip hop artist Snoop Dogg is introducing a project that is to reshape social interaction in the digital universe. He’s partnering with the Sandbox game to create a copy of his Los Angeles mansion — users will be able to “visit” it, see a collection of NFTs, attend parties, and even buy land nearby.
ABBA also wants to host a show in the metaverse while being physically in London. The band’s avatars will reunite like it was in a live show 40 years ago.
The metaverse offers artists huge potential. It redefines crowd-performer interaction — musicians can implement whatever creative ideas regarding their shows without limitations of the real world. And this is possible not to mention the fact that the artists and viewers don’t have to do any traveling to organize and attend shows.
The current downside of a metaverse is that its infrastructure is not always capable of handling an influx of millions of users. However, tech solutions are being developed now to increase the metaverse throughput.
How Do NFTs Work?
NFTs are unique pieces of digital content stored on the blockchain — they are not interchangeable since all have different properties and rarity. It can be an artwork, video, document, or a song. Think of NFT as an original of a masterpiece — like in the real world, you still can print Mona Lisa and hang it on the wall (a copy), while the painting itself is stored in the Louvre (an NFT).
Non-fungible tokens offer great possibilities for music creators, and that drives their adoption in the industry. For instance, an NFT investment platform Royal has attracted $16 million of seed stage investment. The project allows fans to co-own music and even receive royalties from its sales.
After the launch, the Royal founder DJ 3LAU (Justin Blau) has sold his tokenized album for $11.7 million. Soon after this, an investment firm Andreessen Horowitz granted another $55 million to the platform.
Coinbase Ventures, Founders Fund, The Chainsmokers, Kygo are the companies that also participated in the fundraise. Moreover, on the day of 3LAU album release, a singer Grimes auctioned off her tokenized NFT art pieces on the OPENSEA marketplace for $5.8 million in just 20 minutes.
Perks of NFTs for Musicians and Fans
Artists from the whole world embrace NFTs irrespective of their genre. The demand for the technology rises among the audience, too. Eminem, Katy Perry, Tony Lanez have engaged in the rally.
Some experts express an opinion that NFT-drive music is even to replace Spotify. Currently, musicians are having hard times earning money on streaming platforms unless they have worldwide popularity. They only make fractions of cents on their streams. In 2020, top 1% Spotify artists received 90% of payouts. 70% of the platform’s total income goes to copyright owners.
NFTs allow musicians to control their music and give them financial freedom — so they can implement whatever revenue models they want. Music in a non-fungible token format is like a limited edition vinyl — it’s a unique or rare item.
Many fans like this mechanic since it allows them to better support their favorite artists. Owning a copy of music lets them feel more significant compared to simply listening to it on Spotify. What’s more, they can sell this NFT afterwards.
Not all artists will earn with NFTs in minutes, but they’ll definitely raise more money than they could on streaming services. And for buyers, it creates a special connection with the artists. By buying an NFT, “you’re buying a feeling,” says a renowned investor Ben Horowitz. Many users have already paid thousands of dollars for such NFTs.
It’s not only music that singers can create on the blockchain. For instance, Snoop Dogg released his “Decentralized Dogg” merch in partnership with a digital artist Coldie — a 3D collage of 10 portraits of the rapper in different years of his career.
The rapper sold NFTs worth 188 ETH, or 778k USD. Together with all his other NFT items, he has raised $17 million.
So, what are the perks of NFTs that make them so popular among musicians? Let’s summarize:
- Non-fungible tokens are community-oriented — they allow artists to build communities in which fans can engage to support them,
- NFTs give musicians full control over their works and let them flexibly deal with the financial part, which is especially important for beginner singers,
- It’s an opportunity to avoid signing an unfavourable record contract and streaming on Spotify and Apple Music desperately hoping to earn a living,
- An intimate interaction with fans creates a deeper connection with the audience.
Bottom Line
2022 will be a game changer for NFT and music. Combined with the metaverse, its potential is unlimited. Whatever numbers and prices we see, it’s evident that the technologies will transform the music industry. And in this regard, we will watch with interest how recording companies and streaming platforms respond to this revolution.
