AWE returned last week with its first-ever hybrid event, and the metaverse was a huge topic of discussion throughout the conference. Different session tracks explored the opportunities that augmented reality and immersive technologies are presenting for fields such as healthcare, sports, media, and retail.
In the session “Hijacking Bansky Style: The Opportunity Across Gaming, the Metaverse, and Music,” panelists discussed how the development of the metaverse and digital fan engagement opportunities are shaking up the traditional music industry — here are three key trends that will shape the next few months.
Artists Are Opening Up Direct Connections to Fans
One of the biggest trends when it comes to music and the metaverse, which was highlighted by all of the panelists, is that artists are leading the way into this new frontier for the industry and creating new revenue streams directly from their fans.
“What’s really exciting is watching the artists become excited about the space,” said panelist Elizabeth Moody, General Counsel at entertainment law firm Granderson Des Rochers, LLP. “I think that the creators and the performers in the music industry are going to lead the bigger companies into the space.”
When live shows shut down, artists lost their main connection to fans along with their primary source of revenue. “What the metaverse will do and is already starting to do…is allow them to make money directly from fans, but also to connect directly with those fans,” said Moody.
These new digital avenues are allowing artists to connect with fans in ways that they wouldn’t be able to in real life and are also making the experiences much more accessible to their audience. This dynamic will be hugely beneficial to artists in the long run but will also likely change the role of record labels and music publishing companies as artists’ reliance on them for income decreases.
Business Models Are Changing as Music and Gaming Industries Work Together
Virtual musical worlds and performances are adding a layer of complexity for the music industry, particularly when it comes to licensing and music rights. Moody explained that livestreaming a performance is relatively straightforward from a music rights perspective, but incorporating music into games and other digital platforms is more complicated.
Moody explained that issues can start to come into play with content that isn’t live. “When you make copies of content and you make it available later, or you do rebroadcasts, then the gamers need to have conversations with the rights owners, who are the record labels and the music publishers,” she said.
Roblox, for example, recently settled a copyright lawsuit with the National Music Publishers’ Association (NMPA), and signed deals with Sony and BMG to avoid future infringements on their copyrighted music. Although it’s still early days, the unprecedented intersection of music and gaming is bringing about new collaboration between the two industries and the creation of new business models that work to support all parties.
“There's a little bit of a push pull right now, in terms of who's going to share the dollars,” she said “There's only so much money that a fan is going to spend, and the artists should be getting most of that, especially if it's a live performance…But of course, all of the gaming development work that's happening is expensive. And the gamers need to see a piece of that, as well as the record labels and music publishers, so there's a tension right now to work out new business models.”
She predicts that games will start to adopt relatively simple music models to begin with, but that things will get much more interesting as more deals are negotiated and some of the kinks are worked out.
Fans Are Contributing to the Creative Process
As artists are increasingly able to connect more directly with their fans and redefine what’s possible in the metaverse, another emerging trend is the inclusion of fans in the actual creation of music or videos. For example, electronic artist Deadmau5 has already leveraged the gaming community on Core to crowdsource a virtual world to include in a new music video.
Shara Senderoff, President/Partner of venture fund Raised In Space and another participant on the panel, also shared that she personally knows of a few artists and producers that are “creating opportunities for fans to work and collaborate on music…to be a part of the creation of their art.”
This is still a new concept, and many of these projects haven’t yet been released, but they represent the next phase of interactivity between artists and fans and will offer an exciting value proposition.
Senderoff noted that as some artists who have only offered basic perks such as Zoom meet and greets “see the level that other artists are pushing the envelope on utility and engagement and what that really means, I think those earlier artists who dipped their toe in with just minimal offerings will really step up their game,” which means there is a lot to look forward to for fans and artists alike.