Ship or Die at Accelerate 2025: Web3 Music Isn't Working

The future of Web3 music hangs in the balance as industry experts gather at Solana's Accelerate 2025 conference to dissect why current efforts aren't working and chart a path forward for the integration of blockchain technology in the music industry.

Summary

At Solana's Accelerate 2025 conference, a panel of music and blockchain experts convened to discuss the challenges facing Web3 music and potential solutions. The panel, consisting of Clayton Blaja (founder of Material Nonpublic), Ray Jacobson (CTO of Audius), and Dan Smith (of Artist House), brought diverse perspectives from both the traditional music industry and the crypto world.

The discussion centered around why Web3 music isn't currently working, with panelists highlighting issues such as the complexity of music rights, the need for better fan engagement tools, and the importance of focusing on product functionality rather than blockchain technology. They emphasized that the future of Web3 music lies in creating tools that solve real problems for artists and fans, without necessarily emphasizing the underlying blockchain technology.

The experts also touched on the challenges of building in the music industry, including the need to navigate long-standing relationships and complex rights issues. They stressed the importance of bringing all stakeholders, including managers and labels, into the product development process to ensure widespread adoption.

Key Points:

Consumer Web3 and Music Entrepreneurship Challenges

Ray Jacobson pointed out that consumer Web3, in general, isn't working well, which is a commonly understood problem in the industry. He also highlighted that music entrepreneurship faces significant challenges. Building a tech company in the music space is difficult due to the complexities of the industry and the massive data problem that exists.

Jacobson emphasized that crypto and blockchain technology are well-positioned to address these issues, but the solutions haven't materialized yet. He noted that the lasting effects of the 2021 NFT music boom have left interesting nuances that need to be explored further.

The Complexity of Music Rights

Both Jacobson and Smith highlighted the underestimated complexity of music rights as a major hurdle for Web3 music projects. Many tech-savvy individuals looked at the music industry and thought they could create more logical systems, but they failed to account for the intricate web of rights and relationships built over decades.

This complexity has halted many promising projects and underscores the need for a deep understanding of the industry before attempting to revolutionize it with blockchain technology.

The Importance of Fan Engagement

Dan Smith emphasized that the music industry has historically struggled with fan engagement and building fan communities. He noted that the crypto community's understanding of community building could be valuable for the music industry.

Smith pointed out that even non-crypto-native artists are now adopting tools like Discord for fan engagement, which originated from the crypto space. He stressed that the focus should be on building community tools that solve real problems for artists and fans, regardless of whether they use blockchain technology under the hood.

Moving Beyond the "Web3" Label

A key theme throughout the discussion was the need to move away from labeling products as "Web3" or "crypto." The panelists agreed that the technology should be invisible to the end-user, focusing instead on the value and functionality of the product.

They suggested that future successful projects in this space will likely not emphasize their blockchain components but will simply provide excellent tools for artists and fans. The goal should be to create products that are as good as or better than existing non-blockchain alternatives.

The Future of Web3 Music

Ray Jacobson envisioned a future where a proliferation of niche, specific-use-case applications built on blockchain infrastructure would cater to different music subcultures. He emphasized the need for creativity in building these experiences, noting that different genres and fan bases might require vastly different tools and interfaces.

The panelists agreed that the key to bringing the traditional music industry back to Web3 is to focus on the practical benefits and user base, rather than the underlying technology. They stressed the importance of addressing real needs in the industry, such as better fan engagement tools and more efficient data management systems.

Facts + Figures

• Audius grew to 8 million monthly active users quickly after launching during the pandemic
• Most music that makes it to the front page of Spotify is still distributed via XML files on SFTP buckets
• Email correspondences are often used to share passwords for FTP buckets in the music industry
• The economics of touring have changed, making it cost-prohibitive for many artists even after COVID restrictions have lifted
• Many artists, even if not crypto-native, now use Discord for fan engagement
• There are people with Audius tattoos, indicating strong brand loyalty
• Labels and music companies are dealing with a "waterfall of data" that they struggle to effectively use

Top quotes

1. "Consumer Web3 isn't working. And I think that's a pretty commonly held and understood belief." - Ray Jacobson
2. "You can't just come in and bulldoze an entire industry like this and rebuild it from scratch claiming, oh, we have the best technology." - Ray Jacobson
3. "We should really try to stop talking about artists as like crypto friendly or not crypto friendly or like Web3 music. Like we are all music builders." - Ray Jacobson
4. "No one gives a shit what the infrastructure is and what the technology is." - Ray Jacobson
5. "It needs to be not presented as Web3 crypto to music crowd because quite honestly there have been moments where music crowd has been burned in a big way and in a public way." - Dan Smith
6. "Right now, everything is fans." - Dan Smith
7. "If we just stop talking about Web3 and crypto and build really, really good music products, build things as good as part of full, people will come to this space." - Ray Jacobson

Questions Answered

Why isn't Web3 music working currently?

Web3 music is facing challenges due to the complexity of music rights, the difficulty of building tech companies in the music space, and the massive data problem in the industry. Additionally, many projects have focused too heavily on the blockchain aspect rather than solving real problems for artists and fans. The industry needs to shift towards creating valuable tools and experiences without emphasizing the underlying technology.

What do artists and music industry professionals want from new music tech?

According to the panelists, artists and music industry professionals primarily want better ways to engage with fans and manage data. They need tools that can help them connect with their audience online, especially as touring has become more economically challenging. Additionally, there's a desire for solutions that can help make sense of the vast amount of data available in the industry.

How can Web3 music projects gain more traction in the traditional music industry?

To gain traction in the traditional music industry, Web3 music projects should focus on creating valuable tools and experiences without emphasizing the blockchain or crypto aspects. They should address real needs in the industry, such as improved fan engagement and data management. It's also crucial to involve all stakeholders, including managers and labels, in the product development process to ensure widespread adoption.

What is the future of Web3 music according to industry experts?

The future of Web3 music lies in the creation of niche, specific-use-case applications built on blockchain infrastructure. These applications will cater to different music subcultures and genres, providing tailored experiences for various fan bases. The key is to focus on creativity and building excellent music experiences, rather than emphasizing the underlying technology.

How has the NFT boom affected the music industry?

The NFT boom in 2021 had a significant impact on the music industry, providing a new revenue stream for artists during a time when touring was not possible due to the pandemic. However, the panelists noted that the industry has now shifted, and new products need to be developed that work for the current fan base and infrastructure, rather than focusing on idealized scenarios.

What are some of the technical challenges in the music industry?

The music industry still relies on outdated technical infrastructure, with much of the music distribution happening through XML files on SFTP buckets. Password sharing for these systems often occurs through email, which is not secure. Additionally, the industry faces challenges in managing and making sense of the vast amounts of data available, with many labels and companies struggling to effectively use this "waterfall of data."

How important is branding in Web3 music projects?

Branding is crucial for Web3 music projects, but not in the way many might think. The panelists emphasized the importance of moving away from explicitly branding projects as "Web3" or "crypto." Instead, the focus should be on creating products that are so good and useful that people would be willing to get tattoos of the brand, regardless of the underlying technology.

What role does community building play in the future of music tech?

Community building is becoming increasingly important in the music industry. The panelists noted that the crypto community's understanding of community building could be valuable for the music industry. Tools like Discord, which originated in the crypto space, are now being widely adopted by artists for fan engagement. The future of music tech will likely involve more sophisticated and tailored community-building tools.