NFT music platforms to disrupt Spotify in 2022, Saxo Bank predicts
As widespread music streaming companies like Spotify reduce a lot of musicians’ revenues, new applied sciences like nonfungible tokens (NFT) will seemingly assist artists seize again their fair proportion, Saxo Financial institution predicted.
In accordance with one among Saxo Financial institution’s “Outrageous Predictions 2022: Revolution,” music creators will benefit from NFT-based streaming platforms, as they permit distributing music on to listeners with out centralized intermediaries charging a payment.
Saxo Financial institution cryptocurrency analyst Mads Eberhardt argued that mainstream music streaming platforms equivalent to Spotify and Apple Music take a considerable reduce, which, along with the reduce paid to labels, is a few 75% or extra of the overall income.
“These fashions don’t information particular person subscribers’ charges to the precise music a person subscriber listens to,” Eberhardt acknowledged, including:
“The use case for NFTs might show significantly compelling within the subsequent step for the expertise for content material turbines within the music trade as musicians really feel unfairly handled by the income sharing fashions of the present streaming platforms like Spotify and Apple Music.”
The analyst famous that NFT-based music streaming tasks are more likely to kick off in 2022, together with initiatives equivalent to Audius, a blockchain music platform backed by Katy Perry, The Chainsmokers and Jason Derulo. Based mostly on blockchain expertise, the Audius platform is a decentralized music-sharing and streaming protocol designed to take away intermediaries from the music trade and permit followers and creators to work together with one another straight.
In distinction, the way forward for conventional streaming platforms equivalent to Spotify is “bleak,” based on Saxo Financial institution. The corporate predicted that Spotify shares would tumble 33% in 2022. SPOT has been dropping in 2021, beginning the 12 months round $300 and dropping to as little as $204 in August, based on knowledge from TradingView. On the time of writing, SPOT is buying and selling at $229.
Within the meantime, Spotify’s revenues have been steadily rising over time, reflecting a lot potential for NFT-based music platforms to disrupt. In accordance with Spotify’s official 2020 monetary outcomes, the corporate generated 7.85 billion euros ($9.5 billion) income final 12 months, a 16% improve from 2019. Spotify’s financials continued rising in 2021, with the overall quantity of month-to-month energetic customers surging 19% year-on-year to 381 million in Q3 2021.
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As beforehand reported, Spotify has been listening to the cryptocurrency trade, on the lookout for expertise with a crypto background in late 2020. The agency can also be nicely conscious of the rise of NFTs, because it talked about NFTs in its Spotify Wrapped 2021 compiled for customers on Wednesday.
I’ll say I used to be not anticipating to see an NFT reference in my Spotify Wrapped immediately however right here we’re pic.twitter.com/KnpwrR90Y4
— Meghan Bobrowsky (@MeghanBobrowsky) December 1, 2021
Spotify didn’t instantly reply to Cointelegraph’s request for remark.
