Centralization has long characterized the music industry, making it hard for budding artists to distribute their music to the public. The internet revolutionized the music industry, which helped many independent artists build fan bases without caving to the demands of corporate record labels. Songcoin developer David Prince believes the invention of cryptocurrency offers musicians yet another golden opportunity to disrupt the music industry by rewarding listeners for discovering and investing in quality music. CCN spoke with Prince about Songcoin and the role he wants it to play in the independent music industry.
Songcoin Developer David Prince Reveals Plans to Disrupt the Music Industry
What inspired you to create Songcoin?
When Napster came along around 2000 and downloading started to become commonplace. Then I started to think about alternate business models. Something artists and listeners would embrace and benefit from. I could see that traditional revenue streams were effectively extinct and there had to be another way to monetize music and possibly do it better than ever before. Making a few cents from affiliate advertising may work for corporates but it’s not the answer for the individual emerging artist.
Briefly explain your service.
The simplest way to explain how the Songcoin Investment model will work is by using the following analogy: Two Buskers of equal talent take their places in the opposing corners of a busy street.
Busker A uses the “rent-a-crowd” business model. “Just dance around, really get into it and I promise to share some of the profits with you”
Busker B looks on and plays with all his heart; people listen for a moment but are drawn away to where the real action is across the street. Busker A and his rent-a-crowd dance around and look happy. A crowd of likewise happy people gather around the Busker A and soon his obvious talent rewarded. His guitar case is now full of money. When the performance ends, as promised earlier, he shares a portion of his earning with his awesomely successful rent-a-crowd.
In the Songcoin version, artists and listeners will download one of the various multi-functional Wallets from the Songcoin site, planned to include a music player, browsing Songcoin artists, music recognition, storage and other investment features.
An artist will visit the Songcoin site and completes a hosted work specific wallet that is linked via generated QR code to the song that the artist wishes to promote at a later date. Then he publicly announces that the new song will be released on the Songcoin network at a specific time and date. Maybe he plays an acoustic promotional demo of the new song on Youtube, and it sounds fantastic, people become interested / excited.
On the songs release date Songcoin users eagerly await the much-hyped release,;the moment comes, and listeners review the song, they love it, sure to be a smash hit. So they quickly invest as many songcoins as they believe the new song worthy. The song is downloaded to their Songcoin player, pretty soon other users are discovering the song, and they continue to invest. The original investments are at the top of the tree; the newer ones follow along. Pretty soon the artists recording costs are realized. Then the profit starts to roll in and soon our talented artist is wealthy. Like I said earlier, the artist shares his profits with his Songcoin “rent-a-crowd” so soon the early investors are making a handsome profit and everyone is happy and motivated to find the next hit.
That’s basically how it will work. I believe for the first time in recording history (that I know of anyway) listeners will be rewarded for discovering and supporting new music. In my opinion, it will surpass the affiliate and streaming models where only the corporate players make money. It will invigorate the music production industry; recording contracts will become unnecessary.
What are the technical specs of the coin?
Basic Litecoin clone 200m coins. 4 million coin premine.
How prone do you believe the Songcoin system is to manipulation? For example, will very wealthy investors inject large amounts of capital into a brand-new artist (who may or may not be talented) in order to maximize profits? If not, how does the system encourage users to favor truly talented artists?
I suppose a wealthy investor could bankroll an artist as a promotional strategy. It wouldn’t make a great deal of sense though as the Songcoin community would see through that, like busker with one cigar smoking spectator and a hat full of money. The way Songcoin is structured, as an artist your looking to attract as many investors as possible. You could build a strong income base with one successful release.
How is profit created (e.g. are albums/singles sold over the blockchain, etc.)? Also is the process done from within the wallet, a website, etc.?
Songcoin is an online monetizing system, so there’s no physical products. Essentially, an artist unveils the details of a forthcoming release specifically targeting Songcoin investment. The artist initiates a time-stamp wallet that resides on the Songcoin servers and to avoid preemptive investment it doesn’t actually exist until the release date. Then the artist can demo the song without releasing the final version. On the time and date of the tracks release Songcoin investors review the final track and if they think it’s worthy on investment they will send their coins into the song wallet held on our servers where we will redistribute the revenue between the artist, investors and the tech partners.
How do artists make profit? Are albums sold on the Songcoin website, etc.? How are investments handled? Are they shares users can buy/sell, do they increase in price as more people invest (to benefit early investors, etc.)?
The Songcoin network is primarily there to maintain re-distribution of the investment revenue from the investors wallets back to artists and the tech partners. Note: See the attached spreadsheet and alter the values in yellow so you can visually see the investment structure. In this example its at 80% Artists and 10% Songcoin 10% Investors. That hasn’t been locked in yet (Could change to 70%, 15%, 15%) You can see that the earlier Investors will benefit the most. So “Charlie” (1st Investor) starts to profit in this example after the 11th person invests in the song.
When a user invests in a song, they are immediately sent a digital copy to their email and/or app (Under dev.) There’s no other product sales as such on the Songcoin site. I envisage that eventually we will be involved in artist promotion, but that’s something for the future. Its up to the artist to promote their own material and encourage followers to use the Songcoin network. Obviously, they will generate income that way.
I would say that anyone interested in Songcoin would want to lock in their investments in worthy songs as quickly as possible; they will take advantage of any appreciation in Songcoin’s value. (So long as a song is a good one) That goes for artists as well, and I hope they embrace the idea as they’ll be the real drivers of the system.
Do you have any artists currently interested in moving onto the Songcoin platform once it releases?
It’s very early days for Songcoin, but the seeds of this project go back a few years to when I was working on a similar music project. The revenue distribution system was one of the major sticking points to funding which can be achieved rather simply with a cryptocurrency like Songcoin.
When I’m talking to bands on the ground or on the web, I find people are really excited to know more and how they can get involved. That’s one of the key things I find talking with artists is that they love innovative ways to market their music. Art and invention seem to go hand in hand.
What role do you think Songcoin will play in the future of the music industry?
I believe there’s a place for any altcoin even if its only exists to support trading values on the various exchanges. Good coins are like key web domains. There’s a huge opportunity to synthesize altcoins with the value of intellectual property. The Songcoin investment model is all about incentive for users to financially support artists. Once we have a major Indie band involved with our enterprise, and we see some market adoption then we will start to challenge the existing music revenue streams.
Official Songcoin Launch
Prince plans to launch the Songcoin network on October 1. After the launch, the team will begin promoting their service and attempting to attract artists to their platform.
Featured images from Shutterstock.