The last time we ran our Community Barometer survey back in August 2021, things felt pretty shaky for the music industry. The world was still reeling from the effects of the pandemic, and the festival season — which many artists and management teams were relying on to recoup lost touring revenue, as well as to provide some much-needed catharsis after a bleak year and a half for the biz — had mostly been a wash–out.

And yet, there was also a tentative sense of excitement and renewed energy in many of the responses we received. The pandemic’s obvious downsides notwithstanding, many of our community members viewed the period as a “hard reset” for the music business — a rare pause in activity that allowed us to catch our breath and begin to question entrenched industry orthodoxies and practices. In fact, many of us used the lull in activity to start new projects, or experiment on new forms of engagement, monetization and expression. Much of this excitement coalesced around emerging technologies and career models that bypassed dependence on third-party platforms, allowing artists to communicate with (and monetize) their fans directly.

Now that we’re easing our way into 2022, we thought now would be a good time to check in on how we’re feeling about the future of the music industry. Has the hype and excitement burned off — or has it morphed into something solid and sustainable?

Over the month of January, we collected free-text survey responses from 54 of our community members. Below is a breakdown of those respondents’ job roles:

For reference, here’s a snapshot of the job roles of the respondents from August — perhaps the most notable change is that artists have overtaken startup founders as the most represented group in our surveys.

To complement these async survey results, we also held a live brainstorming session in our Discord server, attended by over 50 of our community members, the results of which you can see here (N.B. We did not collect information on the brainstorming attendee’s job roles). All responses were collated and tagged with a theme, which informs the thematic breakdown of each question.

Keep in mind that, as you read this report, you’re hearing primarily from the perspectives of industry sectors that are best represented in the Water & Music community, namely artists, startup teams, music marketers, artist managers and employees at record labels and publishers. In case it wasn’t already clear, this is a highly non-random sample for a highly non-scientific study. That said, mirroring similar surveys elsewhere — like the Pew Research Center’s call for opinions on ethical A.I. design and Hot Pod’s call for reader frustrations about the podcast industry — we think free responses from our members capture a rich and illuminating snapshot of how a niche yet influential community is thinking about the music industry today.

Question 1: What excites you most about music tech right now, and why?

A. Industry disruption and advancement

Anonymous member perspectives from here on out will be highlighted in blue boxes.

“The potential for technology to widen participation in music – at every level: creation, consumption, and everything in between.”

“The possibilities tech provides for systematization, demystification and simplification of an overly complicated and archaic music legal system!!!”

“Automating away extremely outdated music industry practices”

“The possibility of technology totally revolutionizing the way that people value art and specifically music, as well as the creator/fan relationship + integration of art and technology.”

“General awareness that things need to change in the industry and that new tech has finally surfaced to support the change.”

Takeaway: Back in August, many of our community members reported a renewed sense of energy and excitement within the music industry, alongside acknowledgement that this change was well overdue. This energy doesn’t seem to have died down — and indeed, if our community is anything to go by, it seems that much of this excitement has coalesced around the opportunities presented by new technologies and frameworks. It’s worth noting the broad range of applications cited in our responses as ripe for technological disruption, from royalty administration to music creation.

However, it’s also worth noting that this survey only represents the views of Water & Music members. It’s difficult to say whether this optimism is shared by the industry at large — especially since it’s likely that Water & Music members represent a particularly professionally engaged (and arguably more techno-optimistic) section of the industry.

B. Web3

“I love the idea of Web3 and the creation as a different market as opposed to streaming, because I don’t believe in the equation mass consumption = good music.”

“There seems to be near limitless opportunities with how Web3/NFTs can be applied to the modern music industry, especially in an ecosystem that is heavily skewed to favor major labels and artists and disregard the much larger majority of artists and musicians, independent or otherwise.”

“The removal of barriers to capital that Web3 offers, because the music industry is a racket right now.”

“The possibility of using Web3 to reconstruct every aspect of the industry in order to connect fans directly with artists, and repositioning the work of the current ’middlemen’ to be more shareholders in either fan experience or artist development not just DEALSDEALSDEALS.”

“I think it has less to do with tech itself and more the ’interest’ in tech. Web3 and NFTs are driving interest in music, and money into the space, and that’s exciting.”

Takeaway: When we last ran this survey in August 2021, our respondents were pretty divided on Web3. While some of us saw it as an opportunity to reorganize certain aspects of the music industry (especially those related to artist income), others expressed a lack of trust in the underlying technology, and were unconvinced by the utility of many crypto projects.

As the January results reveal, this division remains firmly in place. In fact, Web3 appeared as one of the main sources of excitement and anxiety in this survey. (Interestingly, this remains the case despite Water & Music drawing many Web3 frontline workers into our community through our participation in SC03 and the rollout of our $STREAM Season 1 report on the topic).

Nevertheless, our survey responses reveal a clear need for a viable alternative to “business as usual” for the industry. While the role Web3 will ultimately play in the music industry remains up for discussion, there appears to be no shortage of potential use cases.

3. Artist empowerment

“The notion of the artist as the platform, the artist as the center.”

“Possibilities for forming new value relationships between creators and consumers of music.”

“The possibility that we are at the cusp of a new paradigm around music distribution and changes in profitability (more going to artists themselves).”

“The movement from very few artists being able to create a proper financial world around their art to many.”

“The new tools offered to artists to access their fans and generate revenues”

Takeaway: Back in August, many of our community members expressed (understandable) concern over the pandemic’s effect on artist income. While this concern certainly hasn’t dissipated, many responses this time around expressed a sense of excitement around new career models and alternate routes to profitability. Many of these routes have been facilitated by emerging tech such as Web3.

While improving artist income is obviously a key driver of this innovation, our community seemed equally excited by the cultural impact of direct-to-fan business models, such as the flourishing of niche genres and the possibility of artists maintaining creative control over their work.

BONUS THEME: Community

“Thepossibility of aligning incentives of musicians and fans is super-interesting. Community seems like an important element of any musician’s business today, and anything that gets fans talking to each other and strengthening community would be great.”

The importance of community has accelerated over the last few months. In our August survey, respondents made just 15 references to the concept of communities, versus 36 references in this most recent survey. It makes sense — as artists have become increasingly jaded by platform economics, many have begun reaching out to fans directly, in an effort to own their fan relationships (and data!) and to begin building platform-agnostic careers.

Question 2: What concerns you most about music tech right now, and why?

A. Web3

“To make it in this space you have to do a lot of work that is really stupid – hyping yourself in twitter spaces, sucking up to rich people, showing your face in a dozen discords.  At least when you gig you’re getting better at your craft – this work is empty calories, if not deeply deleterious to being an artist […] Talent is low, taste is bad, and there’s very little evidence that this is going to be broadly liberational for people outside the club.”

“The hype and toxic positivity around Web3 in general. Though future possibilities are encouraging, as currently constituted, I don’t think much of Web3 represents a significant new opportunity for most musicians. If your creative output, personal style and preferred marketing  activities are a good match for the desires of crypto bros looking for a place to park ETH, then great — Web3 seems like a rewarding place to focus your efforts. Otherwise, though, Web3 — right now — looks to me like a huge distraction from what independent musicians should be focusing on.”

“The polarizing debates, especially around Web3. While the experimentation and future thinking in this space is phenomenal, there’s more than a whiff of cultism in some discord/DAO/crypto music conversations. My concern is that the key innovations get lost in the noise of ‘crypto saving the music industry’.”

“The rate at which Web3 is developing alienates a huge swathe of both established and grassroots artists and potential industry pros who are perhaps only just getting to grips with web2. There’s a concern too that going too tech means we lose a bit of the organic, wild, in-person, chaotic spirit of the music industry that a lot of us (being those that have been in the music biz 10+ years) wouldn’t ever want to lose.”

“Overall Web3 bewilderment.”

Takeaway: Our survey responses revealed a plethora of doubt and anxieties related to Web3. These concerns were aimed at just about every angle of Web3 — ranging from concerns around the underlying technology, culture and accessibility, to the rate at which the sector as a whole is developing (responses simultaneously expressed that progress was happening too slowly and too quickly).

Perhaps the most commonly cited concern was the cultural and technical difficulty of onboarding non-crypto natives. If the responses we received are anything to go by, this difficulty isn’t necessarily solely down to complicated UX or confusing gas fees; our members also cited environmental concerns and the “toxic positivity” associated with Web3 communities as key barriers to entry. It’s clear that navigating cultural change will be just as crucial as technological maturity if Web3 wants buy-in from the mainstream music industry.

B. Music-industry dysfunction

“Lack of tech understanding in the music law field and lack of music law understanding in the tech field. The legal field is notoriously old-fashioned, as the policy shows. This hinders tech advancements enormously, especially in the realm of copyright.”

“We aren’t solving very big issues with the system – for instance how a song is registered with a PRO, how we collect on a registered song, how royalties are being paid out, issues with metadata matches, etc. All the boring stuff that really drives the revenues in the music industry.”

“There’s too much focus on the business narrative. Music is more than a product to sell…”

“Music marketing strategies are designed by business professionals behind closed doors without talking to the target audience”

“Many individual projects trying to build the same thing separately, rather than coming together to build community protocols or standards.”

Takeaway: While the term “industry dysfunction” may seem impossibly broad, it was striking how many of the responses we received referred to a range of structural, cultural and administratives difficulties, many of which are hyper-specific to working within the music business. The royalties and legal sectors were both repeatedly singled out, with many responses criticizing the PRO system, and how slow both sectors have been to respond to and facilitate technological advancements (this is something we’ve covered in the past).

Beyond this, many responses referenced a general sense of atomization within the industry, and frustration with the poor creative and business decisions made due to the lack of feedback loops — a state of affairs that won’t have been helped by widespread work-from-home setups. While poor communication is hardly a music industry-specific problem, the balancing act between business and creativity embodied by the music industry (and the cultural industries more generally) make this a particularly complex problem to navigate.

C. Financialization

“The creep of Libertarianism, ’financializing everything.’”

“The potential in many “creator economy” business models to have artists focus on fans that have more money, and leave fans with less money out of the equation, potentially alienating them. Similarly, the implications this might have for artists in less-developed parts of the world. How can they become financially sustainable if their fans can’t afford to support them?”

“The focus on numbers and dollar signs rather than accessibility and inclusion – perhaps due to the point in time but there seems to be more polarization / perceived barriers to entry.”

Takeaway: Again, financialization is certainly not a music industry-specific problem — but many of the responses we received were concerned about how the ongoing financialization of everything is playing out in the music industry.

It’s perhaps unsurprising that this is top-of-mind at present — many of us have been apprehensively observing the recent flood of private-equity investment into the music business, mostly notably through funds buying up iconic back catalogs. It’s a trend that has accelerated rapidly even during the first month of 2022 (e.g. Bob Dylan, Kenny Chesney, Luis Fonsi and John Legend), and that industry analysts have already compared to the digital revolution of the early 2000s. It’s notable that many of the responses we received seemed less concerned with business outcomes, and more concerned with issues of accessibility, fan experience and the possibility of financial pressure forcing music to become less sonically diverse.

BONUS THEME: Inequality & lack of access

“The rate of change is so rapid and so nuanced that many musicians are either unaware, do not understand or worse yet choose to ignore these changes because of limited time and resources.”

“My take – that we are seeing same-old gated clubs built upon the new tools in a way that will create value & profit for the chosen few before they’re eventually opened to ‘the masses’ at which point they just become unfettered bazaars of media.”

The fourth most commonly cited concern in this survey centered around issues of inequality and access. Many of us expressed concerns that the fast pace and steep learning curve associated with Web3 means that many artists will be left out of reaping potential benefits. It goes without saying, but these barriers disproportionately affect artists who are already struggling to make a living, who may be juggling multiple jobs and won’t have the financial resources to mint and market NFTs, or even the time to put into educating themselves on what NFTs actually are. Conversely, these are precisely the group of artists who are failed by the traditional music industry, and who would benefit most from exploring alternate career models.

As our survey reveals, Web3 UX isn’t just a problem for fan adoption — it also creates a real danger of Web3 replicating the same inequalities as the traditional music industry.

Question 3: What are your hopes for music and tech in 2022?

“Everything would slow down, for selfish reasons. But seriously, lots of chasing the new shiny toy vs concentrating on ideas that have worked.”

“Solidarity amongst our fragmented communities.”

“Fans and creators are put center stage in conversations about the future of the music. Technology and industry are there to support these stakeholders, not the other way round.”

“That important Web2 music platforms start exposing proprietary data to musicians, and allowing us to integrate that data into our own marketing efforts. Patreon should let us pixel our pages there. Spotify/Apple Music should let us know who’s listening to our music, for fuck’s sake. Is it so hard to pass listeners’ email addresses on to the musicians whose music they’re enjoying?”

“I think it is going to be really important to get a good group of tech lawyers to bridge this gap of education and ensure music law/copyright policy reform. I hope this (1) happens and (2) is well-informed and conducive to the tech environment. Hope to see more of this in the near future.”

“More innovative interdisciplinary collaborations that push the boundaries of what’s possible with tech — like music x fashion, music x gaming.”

“We are able to create a global model to measure and distribute the earnings of music.”

“I hope for more distribution of wealth; where we see more and more smaller fandoms and subculture communities driving value back to their artists.”

“I’d love to see the emergence of a platform to enable more artists and fans to build connections via Web3. ie a platform where artists can ‘easily’ setup their own DAO and fans can manage their various band affiliations in one place.”

“Restart music industry to a new year zero to fix existing contracts (i.e. Four Tet)”

“No more walled gardens.”

Takeaway: Unsurprisingly, the responses we received to this question represented a wide variety of concerns and priorities. Despite the wide range of problems and possibilities referenced, over a third of the responses we received to this question referenced Web3 in some shape or form — suggesting that regardless of one’s level of buy-in, a great deal is riding on how music and Web3 develops in the near future when it comes to people’s confidence in the future of the music industry. It’s clear that many in the industry are viewing Web3 as a panacea for the variety of industry-related ills. Whether this is indeed the case for Web3 and music — or whether it settles on a more niche application, recreates historical industry inequities or simply fizzles — remains to be seen.

Question 4: What is your wildest prediction for music and tech in 2022?

And finally, here is a selection of our wildest predictions. Check back in 2023 to see if any of these have come true! 🔮

“All streaming to cost £19.99  (rather than being stuck at £9.99)”

“High profile legal music Web3 battle.”

“A token connected to a big mainstream artist will launch”

“Drake drops an NFT”

“Adele drops an NFT”

“A widely accepted tech/database for systematized and transparent rights distribution.”

“Music NFTs will generate $1 Billion.”

“A new social media product will be developed that provides one, integrated entrypoint to all of the main social media apps.”

“30–50% of Billboard top 100 will be non english language songs”

“Within the next year or two, we might see a few major tech companies launch digital asset platforms that tailor to a wider audience and are not tied to blockchain in any way.”

“Insta and Spotify will start giving all the web 3 utilities.”

“Spotify and Apple will come in and acquire everything (SMH).”

“My daughter finally appreciates the Beatles thanks to Roblox.”