Will Bitcoin-based Token.FM truly hit, or end up in the music industry graveyard?
Every once in a while, someone has a fresh, new idea to address existing issues in the music industry. Pressing, painful issues. Specifically, these ideas attempt to get artists paid faster. However, within three years, most of these ideas all but fade away.
So, how will this brand new Bitcoin-based idea fare?
Blockchain, Bitcoin, and token solutions company Tokenly announced today the initial trial launch of token.FM. The ribbon-cutting is happening in early May. The Bitcoin company will also open a Series A round.
So, what exactly is Token.FM? Per the release, token.FM is the first music service to “leverage Bitcoin technology to address existing media challenges.” Artists will control their pricing, distribution, and revenue splits for streaming and sales.
Tokenly also boasts that their music service will feature “more than 20 times” the earning potential of “major” music streamers.
It will also provide a direct-to-fan music platform. However, is token.FM’s “20 times” earning potential simply fluff? The company has yet to give any specifics as to how the platform will make good on its promise.
Fans can support artists directly on the service and receive “true album ownership.” This will allow them to collect, buy, lend, and resell albums they own. Token.FM will also offer fans exclusive access to artist chats or experiences, ticket or merchandise pre-sales, and more.
Tokenly ignores that Instagram Stories and Facebook already offer similar real-time messaging experiences. Fans who already follow their favorite artists online can also pre-order “exclusive” concert tickets.
Using token.FM, artists can “tokenize” their songs into a digital package. They can then set the terms they want for release, including pricing and quantity. Artists can also attach perks, like access to private chats, VIP experiences, exclusive merchandise, and more. Of course, these benefits will only apply to artists who already have an existing large fanbase.
Speaking on the announcement, Adam B. Levine, CEO of Tokenly, said in a statement,.
“Token.FM is all about deepening the relationship between artists and fans while restoring the sense of music ownership that has been largely missing from the digital music experience. Now, artists can fully control the distribution of their music and see exactly who their most devoted fans are, rewarding them with exclusive perks. Meanwhile, fans enjoy full ownership of the music they purchase and a closer relationship with their favorite artists and fellow music lovers. In the end, it’s all thanks to the power of the Blockchain, which we are thrilled to take beyond the stage of conception and concretely apply to direct-to-fan music sales for the very first time.”
The press release omits key information: is token.FM only available for indie artists? Can big-name artists get into the mix? How will they address mechanical royalties, which has plagued streamers like Microsoft Groove and Spotify? How will they ensure payments?
What happens if not enough people get behind token.FM?
The press release did shed some light on how the music service will work, however. Tatiana Moroz, an independent artist, made her catalog available on the platform. Listeners can stream the album using the service’s jukebox-style credits. If you want to listen to Tatiana’s album, you can stream it for free, 2.5 credits, (about 2.5 cents). Artists can also set another price.
How many tokens will listeners get? How much will it cost to listen “for free”? Tokenly didn’t say. However, it did state that artists on the service will keep 80% of revenue from media streaming and sales. They’ll also keep 98% from merchandise.
Hey, maybe this works. You can pre-register for the service at www.token.fm.