vendredi 10 février 2017

Blockchain and live music, not only a ticketing revolution

Blockchain technologies have many potential applications in the field of performing arts. They would permit to freely implement contactless payment systems or the control of nominal tickets ; but also to take over control of the second market of reselling tickets online ; and to issue and distribute electronic tickets in a highly secure manner. The emergence of blockchain technologies, like that of the Web in the 1990s, is a long-term, deep and fundamental evolution.

From colored token protocols to self-certified smart-contracts, including identity and integrity certification, all the tools required to issue and manage electronic tickets on a blockchain, and to easily verify their authenticity, are emerging today. The entire value chain, and the balance of power between its various players, are likely to be upset over time.

A "ticketing" revolution

Few experiments, however, have been conducted so far. According to Peter Shiau, CEO and co-founder of the distributed platform, a start-up that offers blockchain services to companies, blockchain inviolability, and confidence in enforcing rules set by smart-contracts, would allow show producers to permanently eliminate "scalpers" - those who send software robots to buy a lot of concert tickets from the opening of online ticketing, and resell them over the web beyond their price, after having partly dried up the market.

"[A blockchain] ensures the direct and secure transfer of tickets between individuals. Peer-to-peer will be put in concurrence with the [black market], and it will reduce the number of squatters who buy as most tickets as they can for the sole purpose of reselling them at a more expensive price", says Peter Shiau. It would ensure an automatic self-regulation of the second market, with a system of distributed trust, and exchange rules fixed upstream by all the parties involved.

Alex Mizrahi, COO at Chromaway, another pioneer of blockchain services to companies, says that blockchain technologies also enable dynamic pricing (yield management), in order to optimize the filling of venues : a common practice among airlines. "If a show is very popular, the extra winnings will go to the venue or the artist rather than in the pockets of the dealers," he explains. Colored coins or tokens add a new dimension to an electronic ticket. Beyond dynamic pricing, metadata makes it possible to link a e-ticket with a digital wallet, a virtual currency, or a cashless and P2P paiement system. It could change in depth the way we consume at a show or at a festival.

In the Ethereum community's forums, suggestions for ticketing applications based on a blockchain have emerged, that could include crowdfunding, and the management of a fully self-regulated second market.

IP Rights Management

By enabling the issuance of highly secure property certificates with rules associated to assets, blockchain technologies are of primary interest to holders of intellectual property. Some music artists see them as a way to directly manage their rights online, without any intermediaries. Freed from any relationship with a label or a publisher, the singer Imogen Heap decided to issue one of her songs on the Ethereum's blockchain, defining irrevocably upstream, in a self-certified contract, all the rules and conditions to buy it, licence it, etc., and to share its revenues in between all its rightholders.

But from the Imogen Heap's Do It Yourself experimentation to the fully implementation of an automated digital rights management system of all recorded music catalogs or other types of content on a blockchain, the way to go is still long. A highly detailed and open database of rightholders, as well as identifiers of works and sound recordings, should be developed, and enriched with all the income sharing keys established on a contractual or regulatory basis, and to which all parties could refer. Prior, it would be necessary to decide how to resolve the many intellectual property rights disputes that can happen before any certified record in a blockchain.

Like banks, traditional intermediaries in music and media, such as collecting societies, are the first to be exposed to the disruptive nature of blockchain technologies. They begin to pay close attention to the subject. Some major authors' societies have teamed up to develop proof-of-concepts. "We are not studying the way to fully automate the management of rights, but of irrefutable copyright information on a private blockchain," says the director of strategy of one of them. It would be a first step in building an alternative to the Global Repertoire Database (GRD), which failed despite millions of dollars invested.

With the development of live music video, virtual reality, immersive video and new technologies such as binaural sound, live music becomes an increasingly important source of recorded music. Like music recorded in studios, these new live contents will face problems of identification, rights management and distribution that will arise very quickly, to which blockchain technologies are likely to provide an answer.

New scenarios to be writed

Blockchain technologies offer many opportunities for automating, securing and optimizing the management of intellectual property rights on electronic networks. In addition, they offer ways of distributed and highly secure storage of documents or databases and other types of content - like audio or video taping of concerts - on peer-to-peer networks of contributors paid with crypto-currencies for sharing their storage capacities. The US platform Storj offers a distributed storage service still in beta-test of this kind, fully encrypted and secured by a blockchain, on a network of nodes called "farmers".

The amount of storage capacities mobilized are such that the first terabyte of space is free for the user. The "farmer" who shares its free HD space on this peer-to-peer network can expect a remuneration of one to two dollars per month per terabyte, paid in storjcoins, a crypto-currency created by the platform. The contents stored in a distributed and decentralized manner by Storj on thousands of computers running its open source protocol are encrypted. Only their owner can access to them in clear, and those to whom he has granted an authorization.

This is experimental technology, which in the case of Storj still requires many adaptations and improvements. But we can imagine a operational interface between a distributed storage platform like Storj, colored token services and self-certified contracts. It would be possible to conceive completely new scenarios such as, for example, associating a right of permanent access to the audiovisual recording of a show to any electronic ticket issued in the form of a colored token on a blockchain, and having made it possible to attend. A way to extend the life of a ticket after the show, as an asset that can always being valued and exchanged.

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