It is forecast that blockchain investment can increase upto a CAGR of 82% in the media, advertising, and entertainment industry.(1)Around 55% of media executives recognize blockchain as the top-five priority for their organization. More than 83% of executives are elaborating on the blockchain investment in the next three years. Several enterprises have set up a plan to develop a blockchain revenue model in their organization. Recently in 2018, Microsoft has developed a blockchain solution for content rights and royalty solutions.
How does Blockchain work?
Blockchain can be shared among a distributed network of computers without any need for central authority or middlemen. Since the database is distributed across the network. Consumers can access a similar version of data in real-time. Henceforth, decentralized management of the database helps faster processing of transactions and proves to be an emblem of a cost-saving tool.
Influence of Blockchain in Media & Entertainment industry
Blockchain has helmed as the savior of intellectual property rights. Blockchain can prevent data theft in the media industry. It can provide a direct link between content creators and end-users without the need fora third-party channel. Blockchain has created a paradigm shift for royalty collection, platform providers, and content aggregators. BY accommodating immutable state and digital identity, blockchain can enhance the profit sharing for content creators, and media companies by accompanying a real-time consumption-based pricing manual. Blockchain can provide lessened tampering & fraud, and enhanced data quality.
Reinventing the payment method
In the era of digitization, accessing high-quality content is not a tough nut to crack. But this creates a cap on profit-sharing in the entertainment industry. Blockchain solution can curtail the costs by 40% to 80% by adopting real-time consumption-based strategies(2). Consumers can purchase single songs or watch movies on rent by enabling cryptocurrency micropayments. With the help of bitcoin cash, content creators can charge bite-sized content for their work and monetize it. Blockchain can track when and how much content has been consumed. This paves the way for pay-per-use consumption that will ultimately create the new wings for blockchain-powered micropayments.
Today royalty payments have various ambiguities and creators need to sign multiple contracts for the different digital platforms. There is no universal royalty payment system in the digital market. Blockchain implements an efficient and transparent system where royalty payment can be done via the music directory. The music directory is a compilation of original digital music files that are associated with relevant identities of content creators. A smart contract is a refined initiative of a blockchain system(3)where every artist is compensated rationally.
It is a common practice in the market where people share digital content without having an authorized subscription. Previously, attempts were made to legalize it but it had failed due to sheer negligence and lack of consumers’ interests. Blockchain can leverage consumer-to-consumer sales due to its distributed ledger system. In this model, peer-to-peer distribution can be tracked and controlled. (4)When subscribers share their blockchain content with their friends, the blockchain system automatically charges a specific fee from the subscribers. This provides fair and legal sharing to paid content and gives enormous opportunities to aggregators and copyright holders to enhance their revenue.
Blockchain is a nascent stage and it requires more research and development to become a user-friendly medium for common people. Currently, there are very few players in the market that are offering blockchain-enabled revenue model. Most of the vendors have different types of strategies to augment their revenue like partnerships, collaborations, and acquisitions. The blockchain system needs a regulatory body that can regulate all blockchain transactions and develop a standard system.