Fixing the economics of being a creator
We should be living in a golden age for creators.
Now, more than ever, technologies like the internet, media hosting sites, streaming platforms, social media, and mobile phones have democratized access to and engagement with creators. If you want to listen to the latest Olivia Rodrigo hit, watch a new challenge from Mr. Beast, or catch up on the latest indie films, you can do so at the tap of a finger.
Yet it’s still not possible for most creators to make a healthy living off their work today.
While tech platforms have helped us discover and connect with more artists than ever — including more independent artists — only a few mainstream artists can influence platforms. Taylor Swift single-handedly got Apple to change their payout policy to creatives when the company didn’t pay artists during their free trial period. After she threatened to pull her entire catalog from Apple, Apple announced the change in policy the very next day. Swift thanked them, saying “they listened to us” — and did so in 17 hours — but most other creators and smaller artists don’t have that kind of influence or power.
It’s a structural problem in the entertainment industry, and also involves the way many tech platforms operate today: Creators need power, power comes from control, and control comes from ownership. Even though a platform is nothing without its users contributing content to it, those users receive very little to no profits from those efforts. They have no way to decide what happens on those platforms, either.
The question is how to return control where it belongs: back in the hands of creators, and fans.
The original promise of the internet was to connect people directly and remove the gatekeepers. Tech companies then helped connect 5 billion people worldwide, but those same companies have since switched from attracting users, to extracting from them. First they lured — then locked — us in with convenient tools and irresistible network effects: The more people who use a network, the more valuable it becomes to everyone who uses it. Now these corporate-owned platforms have all the power. Contrary to its initial promise, the internet has become as stagnant and intermediated as the previous era of television, which was dominated by just three networks.
Don’t like it? Sure, you could quit Apple, Facebook, Instagram, Netflix, Spotify, TikTok, and X/ Twitter. But you can’t take your follower list, data, or graph of social connections and interactions with you. Sometimes you can’t even take your own content with you. The most popular social networks thus hold audiences captive and, as a result, can charge astronomical “take rates”. Take rates are the percent of revenue that platforms claim for themselves, rather than passing more of that revenue onto their network participants. For Instagram and X, those rates are nearly 100%. (And the terms are often opaque.)
What’s worse, though, is that the CEOs of these platforms have nearly unchecked power to change the rules on their users at whim. They not only can charge higher take-rates any time they like, they can also kick off artists and developers without recourse, and change the algorithms that focus our attention (and therefore artists’ views and listens) overnight. We have all observed the challenges of being a creator today: from the Hollywood writers’ strike, which involved fights over rights to streaming residuals; to the question of who really owns a creator’s work (as artists like Taylor Swift know all too well); to the paltry sums musicians take home despite thousands of streams.
What will it take for creators to get their due? Some legislators have proposed regulating platforms as a remedy, but in practice, such regulation just raises the cost of compliance for the smaller companies, which further entrenches the big incumbents. Last year, Taylor Swift (again) was able to push policymakers across the United States — from Minnesota to New York to Texas to Washington — to take on the Ticketmaster monopoly. Several policymakers also introduced laws at the federal level to ensure price transparency and more. But these are bandaids, trying to stem the flood of injuries platforms inflict on artists and fans and not addressing the structural problem.
Others, meanwhile, are holding out for the platforms themselves to change their ways. Jack Stratton, leader of the indie funk outfit Vulfpeck, urged Apple to “take back the belt” from Spotify. Stratton argued that Apple could offer opportunities for more direct patronage from fans instead of the reigning pro-rata model, where revenue is distributed based on an artist’s streams. Stratton also pushed for Apple to replace the standard 70/30 revenue split between music rights holders and platforms with a more favorable 90/10 revenue split. It’s a nice idea, but good luck getting there in practice.
It’s also yet another bandaid, because it still leaves creators dependent on the whims of platform owners. What artists really need is a say in their own fates on the platforms they contribute to (and help make profitable). Specifically, creators need more of the revenue share; more direct relationships with their fans; and the ability to freely exit platforms with all their connections, content, and data intact. Most of all, creators need the power to help decide the platform rules, so the ground doesn’t suddenly shift under them.
While existing platforms could certainly do better by their users, none of this addresses the core structural issue: ownership. That’s where an important new set of technologies — involving crypto and blockchains — can help. Forget the price of Bitcoin. Forget the dog memes. More than cryptocurrencies, blockchains are construction material for building a different kind of internet — one that shifts power from corporations to communities, including communities of fans and creators.
Blockchains are community-owned and operated, tamper-resistant, and permissionless networks — meaning you don’t have to seek the approval of a single gatekeeper or central intermediary to run them, let alone participate in them. Users (whether creators or fans) don’t have to trust any one leader of a Big Tech platform to keep their promises; the technology encodes those promises. Through blockchain technologies, artists could get more with ongoing royalty payments. They can determine how they want their music remixed or repurposed, and even offer their fans more participation and ownership in their work too. Creators and artists can take back control of their online livelihoods.
With blockchains, creators can own what matters most — their network — and with that, their destiny. When users own their relationships, they can exit platforms and bring their business elsewhere — a credible threat that keeps platforms in check. This freedom helps reduce the take-rates platforms can charge creators and users: For instance, popular blockchain-enabled creator platforms today have very low take-rates, some as low as 1%- 2.5%. Platforms like YouTube have take-rates reaching nearly 50%.
Yes, our digital and creative world is more vast, rich, and convenient than ever. But it comes with a critical tradeoff: Creators are dependent on just a few tech companies that have all the power. These companies depend entirely on the people who use their apps and platforms — yet don’t share much control, ownership, or rewards. Big creators may be fine, but small and medium-sized creators don’t thrive. It’s time to change that. A future defined by blockchains would put power back into the hands of creators and users. Blockchains mean ownership, and ownership means independence.
See also Voices Onchain, which highlights creators who have turned to blockchain technology to unlock new creative possibilities, build deeper connections with fans, and discover more ways to monetize their work.
Chris Dixon is the author of the bestselling Read Write Own: Building the Next Era of the Internet (Random House, 2024) and the founding/managing general partner at a16z crypto.
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