Where is the music indsutry headed? Can blockchain open up new horizons for artists beyond copyright and publishing issues? Experimental electronic musician Lars TCF Holdrus shares his thoughts on the topic.

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Author : Lisa Blanning

Lars Holdhus is the Berlin-based Norwegian artist operating as the experimental electronic musician TCF. While his career has many strands – he’s also a visual artist who shows his work in galleries and exhibitions – and he follows many interests, he was an early voice connecting the blockchain to the music industry. As such, since 2014 he has already delivered numerous talks and presentations on the topic, alerting his musician peers and many other interested parties to the technology’s potential in their own cultural sphere. As a musician whose career could feasibly be affected by the implementation of new blockchain-based services and an enthusiast who has consistently been following the rise of the technology, he’s well-placed to comment on the intersection of the two. 

You’re both a musician and a visual artist, but speaking as a musician that operates in the underground, what needs of yours are not currently being met by the music industry?

My personal artistic practice has to be separated from what I know artists want. For instance, I’m not interested in streaming, personally. But I see it as a need for the community. The most interesting part is what the community wants and needs. I think they need a model where there is a community, because that has basically been taken apart by all of these services. It’s strange that you have to have so many different services for everything. In one way, it creates competition, which can create a better service for us, but it’s also completely chaotic, and you don’t know where your money’s going. You don’t know anything, really. You just sign up with a label, and the label takes care of this, but you have no insight into the whole operation. So, I think transparency’s definitely something that the community needs. And transparency comes out of having services that don’t just see you as one out of two million other artists. It also can customize the service to your needs.

And I think an underground community often wants interaction. It’s not just the musician/fan relation, it’s also musician/musician relations. If you work in that scene, it’s not necessarily for the money. There’s not so much money in it, in itself. But you’re placed with other people that are purely there for the money. When you start to flatten out that model and everyone is treated the same, that’s completely alienating for some people who look for a community.

Soundcloud was popular because it had a community. And now people use all kinds of other things. We have a lot of online radio stations, people make groups on Facebook or other places, but there’s not really a coherent model where you can share your music, talk about it and discuss it, and maybe even produce music together. It’s difficult and a bit dangerous to leave our communities to the people that don’t necessarily have an interest in them, who just have an interest in this transaction that happens.

© Matthijs-Diederiks

How do you think that the blockchain can serve your idea of community?

The blockchain can make the whole operation easier, so you need less actors because it’s more effective, basically. Rights management, for example, can be divided very easily, and you can have way better oversight over your transactions in terms of licensing, synching, and all this. I think the transparency and the efficiency is the main usage. It’s more like a transactional layer.

If you look at how Soundcloud came up, we had the possibility to upload songs easily and spread it to an amount of people easily. So the accessibility of that created communities. And that is what the blockchain can offer you: a certain accessibility to control your own output. The more control the musicians and artists get, the more they can focus on community and so on, instead of just being drenched in all these things they don’t understand. I think there is one main issue for underground music – it’s always going to be on the fringes of music, and there won’t be that much money flowing in there. But the money that is there is transacted through a variety of services, which you don’t need with the blockchain – like publishers, labels, shops to sell the music.

It can even expand into booking. You can have very effective models of booking with digital money. This is one idea I’ve been thinking about: you could set up a booking service for everyone who does not have a booking agent – which is a huge group of people in the underground scene, as far as I know. They are often on the losing side of any deal because they don’t have anyone to negotiate it. You could use the blockchain to both keep the deposit in escrow – it would be immediately transacted after you do your job – and then you could also have a price management system that would figure out your “value.” You wouldn’t have to know what other people are valued as. The system could just tell you, “You’re approximately around here, and now you’re getting an offer like this, and that’s way lower than most people around you are getting.”

So it would be doing it purely by amalgamating all of the data from everybody else.

Yes. It’s a crazy idea. You would have to plug it all into the system. It would measure how many streams you get, how many downloads you get, how many offers you get, that kind of thing, where you’re performing, etc. All these things that normal booking agents use, anyway.

That’s an interesting usage, because no one else has talked about that. Most of the time when people talk about blockchain in relation to the music industry, they fall into one category: publishing and all the things that are related to it, like streaming. Or maybe as a digital distribution system or the database digital distributors can rest on. I like that you’re taking it into different applications.

Yeah, it can have so many applications. The dream would be some sort of platform where all of this can happen together. So you could do booking, you could see your streams, you could see news and things about what you’re doing – everything that a musician normally does on like 30 websites. You could do it on one.

Who would make that?

That’s another question. [laughs] It’s just an idea about where this can go. Already, those services will be created in some way or another, I think. There’s a lot of people working on this right now. Technically speaking, it’s not that difficult.

Let’s talk about Dot Blockchain Music. One of the things they want to do is provide a global database that anybody can access for publishing rights information.

I think it’s risky when you want to make a global database of anything. I’m all for it, in some way. But I have my hesitations about making another format [like .bc]. Because the history of making formats has been very thorny. Even though it proposes openness, it can also do the exact opposite. And with Dot Blockchain, it can be way easier to track every file that exists. That can lead to mixing and sample culture not existing anymore. In some way, it’s great to have this mixing and sample culture freedom. It’s a mixed thing, it would be better to have a culture that respects authorship, but still allows mixing culture.

But you’re talking about problems with copyright, which is an old and outdated set of rules that don’t really take into account what’s happening now in music and art. But the blockchain can’t do anything about that. That’s a change in attitude.

The problem is I haven’t envisioned yet what it could look like. But I do think that there’s a certain risk in assuming that everyone that creates sound and music wants to apply to the sample culture or wants to be a part of it. Regardless of that, it’s a long, separate discussion.

About Dot Blockchain, I think it has good intentions, but I do think there’s a risk. For example, if you take the Bitcoin blockchain, the problem of transparency there is that people are starting to archive the blockchain and do data analysis on it. If you would apply that to music and the dot blockchain format, those that could do that sort of analysis would be in power.

To me, the whole idea of the blockchain in the first place foregrounds the technocrat. The technocrat already has the advantage.

Yes, but that doesn’t really correspond in my mind to their wish. Because I could come in as a tech company and build a service that would do that sort of tracking of copyright on the Dot Blockchain format. And I could charge people for that tracking. That’s not necessarily bad, it just replicates the current situation. Now, the labels go to some sort of tracking services to try to find out where their music is posted illegally to shut it down. And those people make money from the labels. But I think it’s inevitable that we will go into a world where you could track every file.

Right, if you want to, you will have the ability to track all of the data, because the record is public, essentially.

Yeah, and there will probably come a format that just wipes all that out, and that would be the piracy format.

Are there any other blockchain projects that you’re excited about that relate specifically to the music industry?

I’m excited about all of them in some way. I see potential in several of these models. Ujo is one of them. It’s a rights management service.

So there’s a lot of overlap between these different blockchain ideas.

Yeah, because none of them really work yet. Personally, I want to see it happening. I think there’s a big chance that it can benefit artists, compared to the current situation. It seems to be something that artists want.

I agree, most artists want this. Especially as we can see the way that the industry is going, everything is leading towards streaming and downloads and away from physical products – it’s a lot easier for an artist personally to keep track of that.  

Yeah. And I think that artists are fine with publishing their work digitally. It’s just that it doesn’t distribute so well at the moment, and it doesn’t generate much. So the physical format is still something that’s harder to reach, and therefore more prestigious or something. And then it becomes this sort of division: “Oh yeah, you’re on a label, you can publish an actual record, a physical thing.” I think that division is not needed in 2016.

I do see the quality that is there with physical objects, in terms of archival purposes and the artwork. We still live in a physical world, and we are physical units ourselves [laughs]. I see the need for it, but I don’t think that digital releases should be something less valuable than physical releases. And to make that happen, you need a good distribution system that presents this information. There needs to be a lot of work done on how you present digital content.

I would suggest that one of the main problems is just the sheer amount of content there is.

Yeah, of course. That comes with digital.

It’s also about, how do you stand out from everything else? That’s an artist problem, not a structural problem. What about the other blockchain ideas you’re interested in? You mentioned Ujo. There’s also Resonate, which is a streaming service – but it’s less important as a purely blockchain idea and more important in the way it revolutionizes the model of streaming.

Yeah, it’s stream to pay. Which is an interesting concept. People shouldn’t focus so much on the blockchain. It’s pretty irrelevant. It’s just a new form of a database, it’s not magic. I think the blockchain can have extensive usage in the future, in so many ways that we cannot imagine right now. But a lot of other things have to change in our society for that to happen. So it’s not purely a blockchain issue. And the rest of society is not really up to date on what a blockchain can offer. The whole thing is tied together. You can’t separate it and say, “If we use the blockchain it’s going to solve everything.”

No, the blockchain just provides a different set of tools, but first people have to have the will. That’s essentially what Vinay Gupta from Ethereum was saying at a panel discussion at Republica. The question was about how the blockchain could be used for political issues, especially as an extension of the voter registry. And he was saying, yes, the blockchain can do all of these things, but because there’s not the political will, it probably won’t happen. In terms of the music industry, Benji Rogers [from Dot Blockchain] says the music industry needs to do this or that, but the music industry is not one entity. It’s a whole lot of different needs, ideas and desires. And if there’s not a collective will to change… Having said that, things do get adopted and become industry standards, and that happens very organically. For example: the adoption of the mp3 as the universal digital format. And part of that reason was because it wasn’t proprietary.

So people could access stuff for free [laughs].

Exactly. Maybe that’s one of the reasons that the Dot Blockchain project might fail, is that people ultimately want to access stuff for free.

And that has a societal aspect to it. There is a certain social structure to accessing things for free, and considering that it’s something that you deserve – you have the right to access things for free.

I think it only becomes a right after you become used to it for a very long time. I don’t think people first started out saying, “I deserve stuff for free.” But now that we’ve become used to having music for free.

I think when you do that, you do assert the right to have it for free. So the first time you do it, you allow yourself that. Of course the internet makes the maker and listener very separate in many ways, so it’s easier for that process to happen. If I stand on the street and try to sell this to you, and you say, “I want this for free,” the psychological process is very different. The right you take to do so, and justify your views on the world through that. So you say, “I think culture should be free,” or something, while you haven’t asked the author of that piece of music if that should be for free. So there’s a psychological aspect to all of this.

The mp3 format made it so accessible to download music because you could compress the file, which made file-sharing possible, which also created great opportunities. I’m not against downloading. I just see the pros and cons of this. If the mp3 format had never existed, we don’t know if we’d have all this new music culture. So there’s a whole other aspect to this, too. What I’m interested in is to find the balance between these things.

How have your views changed from when you and I first started talking about the blockchain and the music industry over two years ago?

Back then, there were not that many people talking about it. Now there’s a lot of people who want to know what this is about, which is great. By talking to many people, discovering what they want, control for an artist is really important. I think that you can apply that to a lot of things- in negotiations of any kind, the artists often lose because they enter without having the experience in negotiating.

Not much has changed. If you look at some slides I did for Unsound, I think there were ideas there that nobody has even dealt with so far. For example, collecting artists and building some sort of Pokemon Go culture around music collection.

I’m wondering how that translates digitally, because how would that be any different to collecting an artist physically or something like Patreon?

Because Patreon doesn’t have the gaming element, it doesn’t have the fun of collecting. A physical collector is also about finding gems, like rare Pokemons, basically. So I think you have to invent that on a digital level.

That brings to mind the term “digital scarcity,” which is a term that Benji Rogers uses, although I don’t actually know how he’s really using that term. In my mind, what he’s talking about is making something more accessible to anyone who’s willing to pay.

Exactly. I don’t think a culture based purely on payment is that interesting for most people. Community is created by more than just payments. That’s why I’m saying we need to introduce ideas that were there in record collecting into the digital world. It creates a strong fan side. You can be a fan, you can collect music, but it can be digital. But you could also, for example, exchange music. And you could exchange gems between people. You could discover gems, based on the fact that you’re invested in the culture. Not necessarily that you just pay for the culture. For example, if you look at record collecting – I used to be a record collector for a while – you go into the weirdest shops to try and find some interesting records. And then it’s also often about finding rare stuff. But we can pull that to a whole other level without limiting access. We have to be very creative about how we build digital platforms to make them more fun for the collector and for the listener. And make it communal.

There are possibilities but there is no system in place. But if you start to mimic the mainstream model of distributing music into another new platform, that’s dangerous. I think it should be reinvented in many ways. That’s a huge task. It’s really great how all of these people are trying to do that, but I do think that sometimes it turns out a bit too much like the old industry. But as far as the blockchain, there’s not much at the moment really functioning.

Right, for any normal person who’s not a techie, there’s nothing useful on the blockchain yet. It’s just Bitcoin.

In the future, you won’t see the blockchain, it’s completely irrelevant.

It’s got to get to the point where something might operate on the blockchain, but you won’t be able to tell by the interface.

Yeah, check out Arcade City, they’re building on the Ethereum blockchain. It’s a ride-sharing service based on the community. There’s plenty of these kinds of things coming. That, if anything, is going to work and move us into another realm of the internet.

But in that sense, again, to a normal user, it doesn’t even matter that it’s on the blockchain. Because the interface is normal, and you’re using it because it’s got functionality that you desire.

Yeah, pretty much. This is also where the critique comes in that says that it’s maybe not more efficient than a centralized actor. The Bitcoin blockchain has problems with processing all the transactions, and they’re not doing anything to solve it, really. There’s so many problems. I consider the Bitcoin blockchain for cases like music rights and ridehsharing as completely useless. Like you want to wait an hour before your transaction comes through? Or you want to pay a euro every time you transact? Useless.

It’s because it cannot scale. They don’t want to change it because the Chinese are controlling the mining operation, and their internet is not fast enough to handle bigger block sizes. So they say, “We don’t want to increase the block size,” so they don’t increase the block size. So you can’t fit more transactions into each block, and therefore it just takes way longer for each transaction to go through. And that means that it’s centralized, because Chinese miners are controlling it.

What about Ethereum?

They don’t have that problem. They’re going to move into proof of stake, which is not mining. And that’s a really risky operation, nobody really knows what that’s going to look like. But if it works, you can have as many transactions as Visa per second, or even higher. And then you can do a lot. And if the prices per transaction stay quite stable, then there’s hope. Then it’s pretty functional.

But everything is transacting via Ether on Ethereum, right? When are they going to be able to interface with normal currency?

That’s a big discussion, because digital money doesn’t really operate in that way. You’d have to have a token that represents US dollars. But it would have to be pegged to US dollars, and that would be really difficult.

This is why there’s not going to be widespread adoption, because you have to use cryptocurrency in order to use any of these.

And now cryptocurrency is really difficult for most people to use.

I’m a normal person. Theoretically, I know about Bitcoin but I’ve never bought a Bitcoin, I’ve never accessed those exchanges, I’ve never used Tor. The first thing that has to happen, these blockchains have got to be interfaceable with normal banking, as it exists.

Yeah, it’s got to be you click a button and you have Bitcoin. Like you go into your online bank, say, “I want some Bitcoin,” you get them.

Bitcoin should have the same ease as Paypal.

Yeah, of course. That’s what Ethereum is trying to make happen.

If Ethereum are able to that, you’ll have widespread adoption.

Yes. But for any kinds of new services that come, they will always be serving the same needs. And we can build more efficient systems for it, which is what the blockchain is good for. So that money is distributed better to the rightful owner, instead of those who game the system. If you look at politics it’s exactly the same. Now it’s just about gaming the system, so the ones that succeed are the ones that game the system.

So let’s make it harder for people to game the system.

Right. And that’s the same thing in music, like booking. There’s so many actors gaming the system in booking. It should not be that you enter a system and it’s only those that can game the system that benefit from it the most. It should be a balance.

But in a way, it will never be impossible to game. And it will always be some technocratic overlord [laughs]. There’s always going to be somebody who can know more about the system than you, and who can find the ways to use it that you could not. But I think we can make it easier for most people to use and to get their share based on the energy they spend in there. I think Resonate does this in an interesting way by also paying the fans for listening.

By making them members of the co-op.

Not just, they also have a model that says the more active you are on the platform, you get a bigger share of the money. So it makes you, as a listener, an important actor in the system. And that’s very good, because music culture isn’t built in one direction, fans need to be there. And then you could expand that, for example incorporating something like Discogs that would also pay people for entering information into it. And that’s why you should look at [blockchain social network] Steemit, because there people have built so many services around it out of their own will and need, because they can make money building those services by themselves. It’s very crypto-libertarian now, but I think that can change. There are several social networks in the making now that are built on blockchain technology that have micro-payments built into it. We’re going to start to understand that anyone that keeps the system alive needs to be rewarded for it. 

Watch Lars Holdhus sharing with Joachim Lokhamp (JOLOCOM) his ideas on decentralizing the Internet as a social space and cultural distribution space, including the economic factor to pay the artists without intermediaries at Sónar+D 2016.

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