Blockchain’s promise to content creators

By September 6, 2016Bitcoin Business
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Blockchain technology may hold the answer to an issue that has long troubled the creative industry: digital rights management. Through its function as a public database, blockchain can store information about a piece of content, like who has created it, while sharing it with everyone else on the network in an immutable way. SingularDTV is a company that is looking to do just this by building a decentralized platform on Ethereum – a blockchain-based developer ecosystem — to help content creators produce, protect, monetize, and manage their creations, Nasdaq reports.

Blockchain technology could transform the creative industry, and particularly rights management for artistic works, in several ways:

  • Rights protection. Blockchain functions as a public database, or distributed ledger, to account for all goods and transactions on the network. This has direct applications to content, which can be timestamped and stored with a unique ID. Once this information saved, it's virtually unchangeable, unlike most pieces of digital content nowadays that, once downloaded, can be modified at our leisure. Transparency is thus one of the biggest benefits of this system. The rights to a particular piece of content can be seen by everyone participating on the blockchain network, rather than stored on a stand-alone server owned by a record label or copyrights collection society.
  • Monetization. Blockchain transactions are based on smart contracts – code-based contracts that are activated by a given procedure (behavior), and validated by all other computers on the network. Content owners are able to program a set of smart contracts around different usage policies for their creations. When another user wants to consume or repurpose this content, they select the appropriate usage policy for them, and then instantly reward the creator through the smart contract they've selected. Because cryptocurrency is a principal application of blockchain (on Ethereum especially), these payments are dispensed automatically and instantaneously at a near-zero cost.
  • Empowering creators. Blockchain would create a direct consumer-to-creator network, where consumers interact directly with creators, and have direct access to their content. This removes intermediaries like Netflix and YouTube from the content distribution and rights management process, shifting all of the financial upside to creators. On the music streaming and purchasing platform Bandcamp, for example, artists share 10-15% of revenue on each album they sell. Whereas on blockchain, all purchases would be a direct, nonbrokered transactions. The use of cryptocurrency also circumvents third-party payment processors, who usually collect a 4-6% transaction fee.
  • Content creation. Creators are able to tag content with specific metadata (data about data), which, on top of acting as additional copyright information, can improve the discoverability and shareability of that piece of content, and open the door for other creators to build on top of that work. For music, a creator can tag å song with all kinds of metadata that is not commonly found in other databases, like the instruments used for the song, a particular style or culture that the song was influenced by, information about collaborators, sound engineers, and other lyricists... The possibilities are endless. Other participants on the blockchain can then search for songs based on this metadata. This precise level of content discoverability can breed new creator communities and artistic genres.

Blockchain technology, which is best known for powering Bitcoin and other cryptocurrencies, is gaining steam among finance firms because of its potential to streamline processes and increase efficiency. The technology could cut costs by up to $20 billion annually by 2022, according to Santander.

That's because blockchain, which operates as a distributed ledger, has the ability to allow multiple parties to transfer and store sensitive information in a space that’s secure, permanent, anonymous, and easily accessible. That could simplify paper-heavy, expensive, or logistically complicated financial systems, like remittances and cross-border transfer, shareholder management and ownership exchange, and securities trading, to name a few. And outside of finance, governments and the music industry are investigating the technology’s potential to simplify record-keeping.

As a result, venture capital firms and financial institutions alike are pouring investment into finding, developing, and testing blockchain use cases. Over 50 major financial institutions are involved with collaborative blockchain startups, have begun researching the technology in-house, or have helped fund startups with products rooted in blockchain.

Jaime Toplin, research associate for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on blockchain technology that explains how blockchain works, why it has the potential to provide a watershed moment for the financial industry, and the different ways it could be put into practice in the coming years.

Here are some key takeaways from the report:

  • Spending on capital markets applications of blockchain is expected to grow at a 52% compound annual growth rate (CAGR) through 2019, according to Aite Group, to reach $400 million that year.
  • Banks and major financial institutions are working both collaboratively and independently to develop blockchain tech. Over 50 major financial institutions are involved with collaborative blockchain startups, like R3 CEV or Chain. And many are investing in the technology on their own as well.
  • Putting blockchain to use for real-world transactions is likely not that far off. If working groups' tests are successful, firms could be using it to transact real value as early as the end of this year and we could see widespread industry application within the next few years.

In full, the report:

  • Examines the funding increases that are pouring into blockchain
  • Assesses why blockchain is becoming so popular and what factors are driving up increased research and development
  • Explains in full how blockchain technology work and what assets make it valuable and vulnerable
  • Identifies pain points in the financial industry and profiles how various firms are using blockchain to solve them
  • Demonstrates the challenges to mainstream adoption and their potential solutions

To get your copy of this invaluable guide, choose one of these options:

  1. Subscribe to an ALL-ACCESS Membership with BI Intelligence and gain immediate access to this report AND over 100 other expertly researched deep-dive reports, subscriptions to all of our daily newsletters, and much more. >> START A MEMBERSHIP
  2. Purchase the report and download it immediately from our research store. >> BUY THE REPORT

The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of blockchain technology.

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