DotBlockchain Music Signs Up Four Industry Partners, Enters ‘Phase Two’ of Data Project

Billboard - February 1, 2017
By Dan Rys

DotBlockchain Music, the initiative co-founded by PledgeMusic’s Benji Rogersthat aims to use blockchain technology to create an open-source system of sound recording, publishing and performance rights and ownership, is officially entering phase two.

Today, the company announced partnerships with four industry groups to achieve that aim: SOCAN, the Canadian-based performance rights organization, and SOCAN’s rights administration subsidiary MediaNet; publishing royalty administrator Songtrust; indie music distributor CD Baby; and digital rights service FUGA. That gives the DotBlockchain project a collective starting point of 65 million songs with which to begin building out a practical model for solving, among other things, one of the music industry’s never-ending topics: getting artists paid.

The partnerships serve as the first concrete steps of the second phase of DotBlockchain’s three-step goal of creating, to quote Rogers in a conversation with Billboard about the announcement, “a decentralized global database of music rights, combining the publishing and the performance information into a unit of music that the industry can use.”

To take a step back for a second, the problem that Rogers and company are attempting to solve involves the separation of copyrighted creative material from the creators and owners themselves, a problem that is largely a product of the digital age. Essentially, what that means is creating a central location where a songwriter, a publisher, a record label and a performer are all clearly identified and, thusly, can be paid, for every use of their copyrighted material — whether that be someone streaming an album, covering a song or using a track in a television commercial, for instance. Because rights are often held across different companies and organizations that don’t often communicate with each other, incomplete data and disputed ownership (among other situations) too often result in rightsholders not getting paid for their work.

“If a major label is Outlook and the publisher is Gmail, they still write words back and forth to each other using the protocol beneath email,” Rogers says, using a simpler analogy. “We’re looking to be that layer, and we’re looking to help them to build those applications — the Outlook, the Gmail — into it. And they’ll all have different functions, but they have to speak a common language.”

These partnerships are significant for DotBlockchain’s move forward. First introduced in a pair of Medium posts in November 2015 and February 2016, DotBlockchain’s creators are aiming to solve a problem that has long eluded the music industry, and which has left untold millions unrecouped by creators as the digital evolution separated editable music files — mp3s or wavs, for instance — from the metadata that identified its creators. The previous high-profile attempt to solve this problem — the ultimately-doomed Global Repertoire Database, or GMR — failed in 2014, as squabbles over funding and control led leading PROs to pull out of the operation.

DotBlockchain’s model, then, is to attempt to remove the problems of control and proprietary data access that comes with a centralized database, and replace it with the blockchain, a system that allows for a hands-off, clear and open registry (of sorts) where anyone with a stake in a recording can claim their right in an easy-to-operate, open platform (where any issues that arise can be localized to one dispute, rather than derailing an industry-wide project) and easily — and, most importantly, transparently — get paid. In other words: it aims to be the protocol that allows for email communication, not the email or the rightsholder itself.

That’s the end goal, but there’s still a long way to go. Phase one launched last year when DotBlockchain uploaded its open-source code to GitHub and invited industry leaders and investors to take it for a spin on a theoretical basis, creating .bc “wrapper” codes containing rights information and wrapping them around a file. Phase two, then, is more of what Rogers calls a “sandbox”; essentially, a model of what the finished functioning product could look like, wherein labels, publishers and other invested parties can test out and see how it will work before it goes into actual operation where money will begin changing hands. Thus, the four (actually five — semantics dictates four because SOCAN owns MediaNet) new partners will help populate this model and test out its functional application — and where it can be improved.

“If you’re an artist and you want to put your music into Spotify using a .bc, that’s what CD Baby and FUGA are gonna help you do,” Rogers says, explaining each company’s role in a practical scenario. “If you want to bind the publishing information, that’s what SongTrust will help you do. And if you want to have a version of the recording to tag and enter that information into a PRO, that’s what SOCAN and MediaNet will help you do.”

A press release announcing today’s moves says that the partners will also provide “technical and financial resources” for the project, and 500,000 additional recordings will be incorporated each month. It also says that these four companies are just the ones who agreed to take the relatively bold step of publicly attaching themselves to the project; additional “digital service providers and rights holders” are also on board, but have, according to the release, “chosen to remain behind the scenes for now.”

“In putting that first foot down, these pioneering companies are helping us to build and deploy the real-world architecture needed to create a fair, equitable and efficient way for the music industry to work together in the digital rights world,” Rogers said in a statement accompanying the announcement. “We could not be more excited to have the teams from these amazing companies involved. Industry-wide adoption of the dotBC format is our goal and this feels like a very promising first step.”

In a way, the partnerships also give DotBlockchain a way to give the largest rightsholders — see major labels (Universal, Sony and Warner), publishers (Sony/ATV, Warner/Chappell) and PROS (ASCAP and BMI) — a view into whether this is viable and useful. By making essentially a dummy operation, DotBlockchain reserves the right to say, at the very least: come test the waters.

“I think there’s been a certain amount of, ‘Let’s see what they can pull off,'” Rogers says about the industry reaction since he began working on the project. “But that said, we have had extremely positive conversations — with major labels, major publishers, indie labels, you name it. And since then, we’ve met with and had open discussions with everybody, and the support has been overwhelming. I think they want to see this next phase.”

What this “phase two” serves as, then, is a trial balloon for the music industry: you have a problem, here’s a possible, practical solution, what do you think? What happens next will be predicated on that industry reaction, as well as the technology itself, which — while still extremely new — is encouraging enough that ForbesFortune and the Financial Times, to name a few, have penned breathless headlines in the past six months about Wall Street’s infatuation with blockchain’s potential.

“It’s a massive undertaking,” Rogers admits. But without some sort of solution, the music industry seems destined to dig itself an ever-deeper hole, wasting more unrecouped and unclaimed payments each day that passes. “This could become the new way that music moves around the internet. And if we can gather enough people to it, I think it stands a really amazing chance of becoming an open source way of making music valuable.”