Old music download platform Napster is the latest to throw his hat into the web3 and non-fungible token ring. Napster and Lime wire are two brands from the early 2000s that helped pioneer free song downloads that are being revived in businesses helping artists monetize themselves.
What happened: Peer-to-peer music sharing company Napster was bought with the intention of turning the company into an NFT music brand, according to a report from The Verge.
Napster was acquired by a crypto investment firm hive spirit and Algorand, the operator of a decentralized blockchain and the company behind the Algorand piece of money ALGO/USD. The Alogrand blockchain will be used for the launch of Napster.
Hivemind Managing Partner Matt Zhang shared in a LinkedIn post that the acquisition is being made because “a volatile market and uncertain times often present exciting opportunities.”
G20 companies partner Mike Troiano also explained in a medium post why his company is investing in Napster.
“Powered by a new generation of technology but inspired by the same pirate spirit, the new Napster will combine a streaming catalog of over 42 million songs with exciting new features built on a secure, open, carbon-negative blockchain to unlock new new ways for people who make and love music to connect, share and enjoy together,” said Troiano.
The news of Napster joining the web3 and NFT space in the music business follows LimeWire, which announced an entry into the space earlier this year.
Related Link: How to Buy NFTs
Why it matters: Troiano shared the story of a $16 CD, with only 16% going to the artist and the rest split between the record label, manufacturer and retailer. Napster fought the system by offering its 80 million users the ability to download music for free – until it was shut down.
Years later, music download services from Amazon.com Inc. AMZN and Apple Inc. AAPL offered better music download options like purchasing a track instead of an entire album. Streaming services like Spotify Technology PLACE and others allow users to listen to songs with a cut in revenue going to the artists.
Troiano says music labels get 50% of streaming revenue and only about 7% goes to the musicians themselves.
“Napster is already at the forefront when it comes to doing better for artists, offering the highest payouts of any streaming service.”
Universal Music Group signed to join the LimeWire Algorand marketplace this week. Universal has a strong roster of some of the biggest artists in the world. The deal will allow artists to sell NFTS on LimeWire’s upcoming music blockchain platform.
The LimeWire NFT marketplace will focus on assets such as art and musician collectibles. LimeWire investors include kraken, Crypto.com and others with web3 experience.
Once considered dead brands, Napster and LimeWire could quickly become major players in the web3 music space, ready to be disrupted.
It’s hard to look past the irony of two companies that once took potential profits out of musicians as the ones that might ultimately be most useful in helping musicians monetize themselves in the future.