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Audius (AUDIO): Decentralizing the Music Industry

This decentralized music streaming and sharing platform aims to introduce more equitable, open models to the music business thanks to blockchain technology.

Gemini-Category Cryptocurrencies 2

Summary

Equal parts social media, music marketplace, and decentralized streaming service, Audius is a music distribution and discovery platform that is designed to support key functions of the music industry in an equitable and inclusive manner that incentivizes artists and fans. Audius’ myriad features include peer-to-peer (P2P) content sales, a reward structure via its native AUDIO token that is designed to incentivize fan sharing and engagement, an emergent decentralized governance structure that places direct decision-making power in the hands of fans and artists alike, and a multifaceted marketplace.

Decentralized Streaming and the State of the Music Industry

In 2017, the music business was estimated to have generated $43 billion USD worth of sales, but only 12% of that went to the musicians or artists who created the content itself. In order to maximize revenue and maintain control over the business, record labels and publishers sometimes function at odds with musicians, creators, and fans.

Further, many artists and fans feel that the music industry lacks transparency and often rewards gatekeepers over creators, while remaining heavily centralized throughout. While the proliferation of the internet and the subsequent streaming era of music has democratized access to music content for many consumers, some artists have been further misaligned from profit models as a result of this new model. Decentralized streaming solutions built on blockchain technology have the potential to change that dynamic.

What Is Audius? Crypto Network for Decentralized Streaming

Audius is one of the most widely used decentralized music streaming platforms. Its mission is to level the playing field for artists and fans, while continuing to serve essential functions of the music industry and addressing several core pain points that exist within it today. In particular, these include:

  • Insufficient transparency related to the origin of artist payouts as based on gross payment amounts, play statistics, and data insights.

  • Poor ownership rights data, which can result in artist underpayment. Significant earnings are diverted towards performance rights organizations (PRO) and digital service providers (DSPs) like Amazon or iTunes instead of creators.

  • Industry processes that are often beholden to gatekeepers and middlemen, which can increase costs while limiting artist and fan optionality and slowing progress.

  • Publishing rights, which are often complex and vague and can disempower creators from taking agency over their revenue streams.

  • Derivative content including samples, remixes, and covers, which are inhibited because of under-developed rights management issues.

  • Licensing and copyright challenges, which prevent DSPs and content from being available in many jurisdictions.

The Audius Crypto Platform and Democratizing Music Access

First and foremost, Audius is a platform for decentralized music distribution and discovery, and a marketplace that connects musicians and fans directly. The Audius music platform interface experience is similar to that of a social media network, complete with profiles, news feeds and various networking and sharing features. Artists can build their own fanbases, share content in various formats, and maintain control of how they monetize their followers.

At first glance, this format may appear similar to the user experience of streaming platforms like Spotify, but Audius offers a variety of blockchain-related functionalities. For example: Audius’ crypto protocol gives artists the ability to create and collect their own non-fungible tokens (NFTs) and reward fans through an engagement-based incentivization structure that allows users to receive discounted or free tickets, VIP experiences, and other benefits. Fans can even receive the platform’s native AUDIO tokens as rewards for their engagement with Audius music content.

Audius also allows artists to generate immutable and timestamped records of their work, mitigating any potential for copyright infringement or theft of material.

Main Components of the Audius Music Platform

The Audius crypto protocol makes use of three distinct components to operate its decentralized music streaming platform:

  1. Content nodes: Content nodes represent a user-operated network of nodes that hosts content data and allows for permissioned access to content for artists. It’s how Audius users can access their desired music and content, built over a distributed network model instead of hoarded in silos. This system works via the use of AudSp, a specialized extension of the InterPlanetary File System (IPFS) which stores files on a distributed network to ensure they remain highly available so the platform operates in a decentralized and verifiable manner. The system also helps control file upload flow and content permissions, among other processes.

  2. Content ledger: The platform’s content ledger acts as a single source of truth to enable the functionality of the Audius crypto network. Currently, the content ledger operates as a combination of smart contracts via the Ethereum blockchain, POA network, and in time, several Layer-1 and Layer-2 blockchain protocols. The content ledger is responsible for determining (through several distinct blockchains that have various levels of network scalability) consistent levels of audio content and metadata formatting. It is used to determine correct parameters related to tracking content, revenue allocation, and content ownership structure. Lastly, it acts as a node registry for all nodes within the system, and as a social graph that systematically keeps track of user interactions, as well as the basis for token and governance structures on the network.

  3. Discovery node: The Audius crypto protocol utilizes a specialized node called the Discovery node to query (search) and index content and metadata so it can be found by users on the network. In order for the system to work in an equitable and transparent manner, the Discovery node must be decentralized, easy to use and efficient, provably correct, and extensible to promote accessibility while hindering manipulation of searches performed by users.

Audius Token’s Structure and Governance Functionalities

For Audius to operate as a community-owned and operated platform, a democratic governance structure is critical. Central to the ecosystem’s governance model is the protocol-specific AUDIO token. The AUDIO token is designed to enhance the fairness, accessibility, security, and governance of the Audius crypto ecosystem through network-based token staking and incentivization. Meaningfully decentralized blockchain governance should allow for active participation of a wide variety of network stakeholders. Thus, to maintain the long-term viability of the project, node operators, artists, and fans are given collective voting rights — executed by staking AUDIO — that allow them to add new features, change royalty rates, modify fee pool allocation parameters, change token distribution metrics, and alter staking reward rates over time.

Further, AUDIO tokens will allow musicians to make use of various incentivization tooling systems including badges and increased earnings multipliers as well as their own specialized artist tokens and NFTs. In time, the Audius platform will facilitate the use of external network-specific stablecoins to unlock paid content, in the process allowing creators to set their own rates and enabling fans to interact with easy-to-use fractional payment mechanisms.

Audius Collectibles: An NFT Marketplace for User-Artist Engagement

In April of 2021, Audius launched its own NFT marketplace: Audius Collectibles. The service allows artists to showcase collectible NFTs on their profiles, in addition to tracks and albums — giving artists the ability to crowdfund concept albums and multi-artist collaborations, create new types of media such as limited-edition album art, and create incentivization rewards for loyal fans through NFT airdrops. It also gives fans the chance to acquire backstage passes, concert tickets, VIP rewards, and more.

To add to these functionalities, the platform allows artists to display their NFTs from multiple crypto wallet types and marketplaces including Rarible, SuperRare, OpenSea, and others, with more to follow soon. Audius also allows users to create profiles so they can interact with other users and artists via an identity-based verification mechanism. In September of 2021, Audius enabled support for Solana NFTs.

In addition to the many features mentioned above, Audius allows software developers to create their own decentralized applications (dApps) that run on the platform through the network’s application programming interface (API). Moreover, Audius gives its community members AUDIO token rewards for creating trending tracks, playlists, highly used applications, and more. Audius also recently developed Audius Hedgehog, its own open source, user-facing Ethereum wallet which allows users to access their dApp from websites without extensions in a decentralized manner.

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