#Web3Sound #NFBMusic #BlockchainRevolution #CryptoInvestments #A16z #SoundRevolution #MusicNFTs
Cryptocurrency business A16z led a $20 million Series A fundraising round for music project Web3 Sound.
Source: Twitter
Other investors include Palm Tree Crew, A Capital, Collab + Currency, Scalar Capital, actor Ashton Kutcher, producer Ryan Tedder, musician Tay Keith and rapper Snoop Dogg.
With Sound, an alternative to traditional streaming services will be created for musicians. Through the platform, musicians will be able to convert their songs into non-functional tokens (NFTs) and sell them directly to fans.
We support artists who set their own prices and sell their music directly to fans rather than platforms or companies. Artists get paid quickly and have access to a list of their most loyal fans for each track. The music industry has made significant progress since the advent of streaming, the initiative said in a press release.
Sound’s main goal is to challenge the established business structures of Web2 streaming services such as Spotify and Apple Music. The platform allows musicians to create non-functional tokens (NFTs) that can be directly sold to fans.
Since its test launch in 2022, the platform has already helped musicians generate $5.5 in revenue. Now it is being made available to the general public. David Greenstein, co-founder of Sound and former product manager at Pandora, said that over the past decade, music subscription services have had a detrimental effect on artists’ revenue. For example, musicians on Spotify receive about $0.003 per stream.
The businessman made the decision to allow listeners to pay bands the amount they choose after being inspired by English rock band Radiohead’s “pay what you want” strategy when they released their In Rainbows album in 2007.
According to Greenstein, the Web3 industry facilitates direct payments for music. He said it allows musicians to dispense with middlemen and keep all the money for themselves. Musicians can upload their tunes, “mine them online,” and then sell them for ETH using the Ethereum blockchain and Optimism’s Layer 2 scaling solution.
The chart below shows the significant difference in revenue between musicians on Spotify and the NFT platform Catalog. Catalog artists earn about 10(!) times more on NFT than on traditional platforms.
Blockchain is fundamentally changing the process of releasing and monetizing music. Let’s say a pop band from Arizona wants to capitalize on a drum kit and upgrade their sound. Their buddies decide to help them and create DAO (Decentralized Autonomous Organization), all participants will have copyrights to the music in the form of NFT tokens.
It turns out that artists will earn royalties from every song listened to by anyone in the world, according to the terms specified in the smart contract. No middleman – hello profit! With the help of NFT musicians will be able to earn many times more and form their own unique fan clubs using SongCamp, Friends with Benefits, Zora.
However, musicians can do without DAO platforms and launch their NFT music projects on marketplaces.
The second source of income after NFT drops is receiving royalties from all future sales on the secondary market. There have been cases where a musician’s passive income from royalties exceeds his salary in the regular music industry. Although Daniel Allan was an unknown musician with a few hundred followers on Twitter, he was able to generate $190,000 from secondary sales on Sound Marketplace alone. American musician RAC, a 2017 Grammy Award winner, shared his achievement in the NFT industry in a tweet:
Are there benefits to NFT for the listener beyond ownership?
Yes, there are many: NFT, for example, in addition to ownership of a digital work, can provide access to an artist’s Discord channel, where fans can write directly to their hero. Owners also receive additional perks, including early access to new songs, discounted concert ticket giveaways, backstage socializing, various membership programs, and more.
Collectors are increasingly accumulating music NFTs as a means of investment. Over time, the value of tokens can increase as the artist’s fame grows, or they can generate passive income in the form of a share of royalties.
Bottom line
So, in conclusion, raising $20 million for A16z’s Web3 Sound project is a big thing! It shows that music NFT and blockchain are in the spotlight and attracting serious investment. Sound offers new opportunities for musicians to sell their music directly to their fans and even create their own unique fan clubs.
This not only gives them more control over their creative endeavors, but also allows fans to enjoy additional perks like early access to new songs and interaction with their favorite artists. All this hype around NFT and blockchain is opening up new horizons for musicians and listeners, and we can expect even more developments in this area in the future.
After all, it’s great for artists and fans alike when music brings joy and money!
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