Decentralized Music with Stems Protocol

well decentralized music my name is Haytham let me start by introducing myself uh to give you a little bit of context on who's talking about this topic I'm a third culture kid I was born and raised in Morocco I have some French influence and us also as well and I've been living around the world for the past two years the reason I think this is relevant is in these decentralized environments you have different perspectives coming together and so understanding the need to create like a safe space for for everybody's very important I also have a background in engineering worked in web 2 and crypto open source and then obviously I love music I like to freestyle rap sing a song damn it got really loud um also I wouldn't preface this by saying I'm not an expert I don't think anybody's an expert in this field it's rapidly changing so take anything I say with a grain of salt okay so what's uh what's wrong with the music industry right now um so the the meme right here is very funny but it's actually pretty true I'm sure people in the audience know at least someone who's a musician and couldn't really make a living off their music unfortunately there's there's really a plethora of reasons why the music industry is fragmented and kind of inefficient uh but if I had to to say like one kind of key takeaway is just poor mechanism design around the Creator not getting properly like not capturing uh wealth and uh and power around the music that they're releasing and there's a variety of reasons why this is happening sorry for this um so back catalog is owned by by Major like three major labels so 80 of Spotify playlists are controlled by the three major labels and seven percent of Spotify is actually owned by Sony and Universal Music um so they have this control like this long lasting control and then there's an insane competition so 60 000 new tracks are released on Spotify every day and only like point two percent of of artists on Spotify make barely above living wage in the US there's also internet piracy which we're going to talk about enough so since 1999 the US economy more than doubled whereas uh the the music industry sales like barely just are back to where they were at the physical record time so this uh this graph kind of shows an interesting um Evolution you can see how it kind of peaked in the 1980s with vinyl and then peaked again with CDs and cassettes and then with the internet just plummeted um with piracy and then kind of the hope is that it it was already growing back with the Digital streaming sales before web3 and web3 can potentially make that even better so how can web3 music help um there's many ways so I'm kind of I'm more aware of the music nft route music nfts present this this very low effort uh additional income stream for musicians so they already have their audio files and only need to slap them on an nft to kind of make more more money with their with their art there's also very cool uh ways we can re-imagine music production and kind of consumption one of the one of the examples is artists fan communities so for instance I I collected some of my favorite artists nfts and thanks to that I have conversations with them I built a relationship I think it's very unique to web3 and then obviously there's all the the traditional blockchain nft advantages like transparency you know you can verify that you're somebody's you've been somebody's fan for 10 years let's say you've bought an nft by Drake like years ago you can say that you were one of the first people to call the shot that he was going to be big and so on and so forth um so I'm I'm basically focused on on music nfts at the stem level uh for people that don't know what stems are I'm gonna put this video on to explain it unfortunately there's no sound in the live audience but the live stream people are gonna hear it um so I'll just play it what if there was a song you know so basically every uh instrument track you were seeing on Ableton like the drum and uh the vocals he's doing each of those is a stem so it's basically it's basically a piece a piece of a song so when you have a song today and on Ableton usually you have different instrument tracks each instrument track is called a stem and we're basically uh thinking that having stem nfts is an interesting approach to web3 music because it lets uh the music be created on chain so people are using these music building building blocks to kind of create music together and since it's already on chain it increases the leverage of uh web3 kind of content and we'll drive users coming to the to these platforms also some cool side effects like stem level rice attribution so you can know you can give credits at the stem level you can give information on the sound file the stem level and then there's this cool side effect of natural Rarity hierarchy so if you think of one of your favorite one of your favorite songs like Stephen Seven Nation Army or DJ Tiesto song and you think of the different sounds that you hear there's probably a sound that you prefer so if we do a random mint on a sound and you're getting one of the stems you'll probably have one that you really want to get and usually it'll be like the main vocal or like uh you know the guitar line and obviously it changes from one person to the next but it's kind of reminiscent of the pfp kind of Rarity of nfts so I think it's it's also an interesting kind of uh property um so what do we do with these stems basically yeah the artist an art a given artist uh let's say DJ Tiesto because we went with him takes a song that he has out and drops the stems of that song is an NFC collection so basically they're different instrument tracks then we incentivize his fans and our community to make music with those stems so making new music so let's say you use one of the snares from that song and you add your own samples and you mix it and master it however you want and then you make a new song out of that um so then DJ Tiesto can actually approve your song on chain if he likes it and tie the that song nft Back to the stem NFC that you used from from him so basically it's kind of like an on-chain featuring if you're still with me I really appreciate it it's going to get a little bit ugly for a bit but just just bear with me so basically what what this is is a set of smart contracts that represent these entities on chain so you have a project Creator contract that allows us to create new projects one a project is one or multiple artists they can then release um stem collections so a collection of samples or stems that are tied to a specific song are released as nfts and tied to this project on chain and then the project releases a song a collab song contract that other artists or other users can use to Mint nfts that tie back to their stems to their samples so basically you can you can get their approval on chain for using their samples you can clear somebody's art and music on chain um maybe you've heard of this Paradigm before we talk of unopinionated protocols and opinionated platforms so basically just like the ethereum blockchain protocol is a set of rules um that ethereum node clients interact with we have this stem protocol which is a set of rules for anybody really to interact with the smart contracts and and kind of tie pieces of intellectual property or media files together on chain and then we're developing also this platform called stems uh at stems.r which is a UI wrapper around the stems protocol which is meant to drive Network growth uh because uh really the like all these there's a lot of protocol protocols these days and and I guess like the power like the measure of power for a network would be the growth rate and and the size which are um there's two main drivers in my opinion for that uh one is like very strong financial incentive so in the case of layer one like proof of work mining um you can have like a very very bad ux like if you're trying to mine Bitcoin or proof of work ethereum it's not a smooth experience uh but because of the financial incentives you're still going to join the network and do it um in the case of like the application layer of the blockchain which is where we exist uh you really want good UI ux to provide an experience that's actually even better than the Alternatives in web 2. so if you think of swapping um swapping something on Ave for like swapping like uh currencies that experience is a lot smoother than a foreign exchange swap on uh in web 2 basically um and and you can see with this graph that we're still ways ways it's like very early still um only 200 million ethereum addresses that's that's just unique addresses so probably like 100 150 million users and uh as a kind of web3 music main challenge in my opinion is to get all the other people that are using music streaming onto web3 um you know before even competing with each other uh and such okay and just for a closing uh kind of closing thought to to get your minds uh kind of racing a little bit about this the space um because I don't uh I don't pretend that we've actually nailed how this this can can be can work at its ideal it's really like imagining something that's never existed before uh but the challenge is is as I described like the UI ux hurdles so just sign up authentication is a massive friction point for users obviously like we would get so many more people on our platform if they didn't need a wallet for instance so there's some solutions for this but that sacrifice privacy unfortunately and the thing is like you know you have 99.5 of cases your signature goes through it's pretty smooth and then point five percent of cases you're showing somebody at a dinner uh your app and then they're trying to log in and it takes two hours just like completely ruined the whole product for for the entire dinner table and this this happens very often um another like more specific to web3 music issues it's really unclear what the value of music nfts is as a speculative asset you can see the the graph of Music nft sales over time how it's like kind of flatlining it is along the lines of visual nfts as well but um definitely shows that we haven't tapped into what music nft technology can unlock besides like speculation you know like creating ecosystems around the nfts and that's kind of what uh stems is trying to do there's also this web3 native Eco chamber that you find in different uh sectors or verticals in in the music space is the same like you know I'm a part of it I'll support my friends dropping their nfts and we'll buy each other's stuff and then it's kind of unclear who are the actual new entrants what is the actual real value created uh that is making people want to buy these nfts so we kind of need to escape that um and kind of focus on bringing external people onto these um onto these ecosystems and the last one I wanted to touch on since uh you know nfts are a big part of this talk you heard me say nft a thousand times is uh so you've probably all heard of the blur versus openc kind of drama recently where blur is using a tokenomics approach to incentivize people to use its platform uh and just slash like the the fees that you would typically pay on nfts on openc which then LED open C to slash its fee uh leadings is like cannibalization of the ecosystem and it's it's actually a pretty interesting development because if you think about it what the web three-way is kind of using tokens so blur is using tokens to these incentives um and open C is forced to put the user first with that [Music] um you know like cutting the fees really you know the benefits the user the issue is you know blur is really creating like an early stage uh majority that will dominate the platform later on it's like how do you how do you make sure that it grows and maintains itself um and we're thinking of like this in the context of our platform like subscription versus nft like axis nfts versus like files in nfts Etc um yeah so that that's it there's a couple minutes if I don't know if we're doing questions everything anybody has uh wanted to weigh in or has a question yes in general you mean yeah so there's place this place is the dominant like freeze license stems uh software platform you pay like a subscription fee and then you have access to infinite stems um and then there's play like you can't actually find the stems of songs that you listen to if that's if that's your question in general yeah so splice would be it yeah obviously like our stems.r we have the stems of the specific artists that drop to this yes you talked about a stem approval like when you create a new song what if the artist doesn't want to prove the song You've created with their stem yeah great question is the whole point is like we don't want to force people to uh like be creatively you know partner creatively with someone if they don't want to so you can't actually mint that song on the blockchain you can't if it's not approved by the artist so what what is happening under the hood is you're basically uploading a song to for the artist to see and if they like it they're whitelisting your address to Mint an nft with that smart contract so if you're not white listed you just can't do it awesome that's it all right thank you do a big round of applause thank you so much [Applause] foreign