Spotify to Face the Music: Competitor on the Ethereum Blockchain Wants to Eliminate Record Labels
In an interview with The Money Show’s Bruce Whitfield, Simon De la Rouviere, the 28-year-old innovator behind Ujo Music, explains how his blockchain-based platform is the new model for artists and why Spotify is a dinosaur.
“Ujo Music is a blockchain-based platform that allows musicians to have control over their rights and their music, that they don’t have to necessarily sign over their rights to other institutions, say record labels or publishers,” says De la Rouviere.
The platform creates a decentralized database of rights and rights owners, automating royalty payments through smart contracts and cryptocurrency on the Ethereum blockchain.
It exemplifies the spirit of cryptoeconomics – a growing consciousness around how value is created, how it can be managed, how it can be transformed, and how it can be transferred. A blockchain platform can re-rig the wheels of capitalism by upending the means and methods of distribution, effectively diverting the flow of capital away from monolithic companies that own, for example, headphones as well as audio engineering software, as well as music streaming services, among other related services and subsidiaries, while also controlling royalty payments to artists.
“When they use Ujo Music, they can more directly license their music, where a hundred percent of the payments goes directly towards the artist,” says De la Rouviere. “It’s not giving 30% to Apple or to other people that are not necessarily involved in the transaction between the fan and the musician.”
Based in Capetown, De la Rouviere has been building the platform for years with the support of Brooklyn-based ConsenSys, a venture production studio that’s helping a diverse range of developers who are building decentralized applications across a spectrum of industries, such as the blockchain real estate disruptor Meridio.
Along with a new business model and new concepts about generating revenue come the questions about profits and how they’re generated without all the middlemen, distribution companies and gatekeepers who charge the fees.
Says De la Rouviere, “In a world where the infrastructure is owned by everyone simultaneously, and the infrastructure is shared, you don’t have to necessarily charge 10 to 30% for a transaction in the case of paying for a song on iTunes. So, we said that in the future, 10 years from now, this is what the infrastructure will look like, where you could be able to pay and license music directly from the fan to the artist, where the infrastructure is supported by everyone. So currently, we’re just aiming to prove that this is possible. And once there is this market that exists, there will be value-added services we can provide – and not extracting value from artists.”