The music industry has undergone many changes over the past decade.
Digital downloads and streaming effectively took over as the dominant models of consumption. Royalties from music sales aren’t the cash cows they once were. Artists now have to look toward live events, tours and merchandise to maximize their earning potential. However, even this sector hasn’t escaped continued disruption from technology as audiences’ demand for digital entertainment evolves.
The emergence of virtual reality (VR) has created a new channel for artists to connect with their audiences. Live performances can now be streamed directly to virtual headsets. Companies like NextVR , CEEK and Enosis have all been working on platforms and projects to produce interactive and multimedia experiences. A growing number of production outfits and artists are already trying out the technology.
VR, however, comes to the industry as a double-edged sword. On the one hand, VR expands the possible audience for a single performance. People need not be physically present at the events to experience them in an immersive way. On the other, it can also limit revenue from merchandise sales since these are greatly dependent on people’s presence at live events. Fortunately, this is a conundrum that a complementary technology such as distributed ledgers can help remedy.
The VR Performance
People want more from live performances these days; simply look at how the Super Bowl halftime show has evolved over the years to see how far the envelope has been pushed to create a stunning show. Unfortunately, people are now expecting something grand even from “routine” concerts and shows. It appears that artists’ showmanship has become just as important as their musical talent.
VR is helping add a new dimension to live events. VR allows 2-D, 3-D and even sonic artistry to be woven together with the performance to create a richer experience for the viewer.
For example, Enosis and Google partnered up to bring Queen’s ” Bohemian Rhapsody” to VR . The VR app features animated versions of the band, including its late front man Freddie Mercury performing the iconic hit. NextVR is also aggressively bringing VR to sports and entertainment. The company is working with professional sports leagues like the NBA and the NFL to bring a more immersive way for sports fans to watch the games.
Through VR, audiences can experience events from different points-of-view. Instead of just being limited to one specific seat and view of the live action, VR allows them to see the performers’ view from the stage or a bird’s-eye view through cameras on drones high above the stadium. Developments in the headset and tactile technology even promise a multisensory future for such VR experiences.
Monetizing the VR Experience
While the technology can help deliver the extravaganza that audiences want, VR can also cause disruption to the prevailing business models of live entertainment. It’s not only in ticket sales that concerts and performances get their revenue. Much of the money artists make from performances actually comes from merchandise . The sale of goods could even be higher than the revenue from the tickets.
A shift to VR could threaten this revenue stream. Merchandise may be made available online through e-commerce, but the live events drive on-the-spot sales. As such, a mechanism to push merchandise through VR must also be developed in order to create a virtual equivalent to it. Besides, virtual items could be used to help create a richer experience.
CEEK has turned to blockchain technology for answers. Aside from its own VR platform, the company is working on a blockchain-driven coin minting platform that allows artists to create their own crypto tokens to facilitate transactions. The feature, dubbed “Celebrity Coin Cast Minting,” leverages blockchain technology to create an immutable record of the existence and trade of these virtual items. Artists could even cryptographically sign items to give them additional value as unique memorabilia.
Bringing Further Disruption to the Industry
Artists and record labels may have just recently settled into the new economy brought about by digital downloads and streaming. Yet, the industry seems poised for further disruption through VR.
VR can offer the means to create a sensory experience similar to, if not richer than, live performances. VR may even become a more cost-effective way to reach out to audiences as VR events can be done without the expense of large venues and concerns regarding logistics and security.
While still in its relative infancy, the growing ecosystem of VR services is also filling in the gaps to concerns such as monetization. The coming together of the live audience and virtual spectator markets creates for interesting convergence. The introduction of blockchains as a safe and secure means to facilitate VR transactions could inspire more confidence from consumers to try the experience for themselves.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.