Epic Games’ recent remarks about “low margins” in the creator economy have ignited a crucial question: What transpires when user-generated content surpasses the popularity of the core material it originates from? Fandom expression increasingly occurs through creation, possibly serving as the music industry’s next growth driver. However, the challenge lies in monetizing it effectively, especially when consumer creations become substitutes, rather than mere additions, to original songs. This transformation might begin with social platform subscriptions on the likes of TikTok, Facebook, and Instagram as they test ad-free subscriptions. This shift could be driven by factors like regulatory pressures surrounding user data, the waning tolerance of younger generations for ads, and the shift in social advertising towards influencer marketing, which doesn’t share revenue with social platforms.
However, it’s hard to envision users paying for social media services without additional benefits beyond ad removal. What if there were premium creation tools, including music, available as part of the subscription?
Picture opening TikTok and selecting a song by Mitski to include in your video. As a premium subscriber, a set of music editing tools appears, allowing you to adjust the song’s speed and apply a lo-fi filter that aligns with your video’s aesthetic. When you share your creation, an icon next to the song title signifies that this is a fan-edited version, ensuring additional revenue from subscriptions reaches Mitski. This structure would permit artists to opt in or out of the process, with editing features available only for songs by artists who have opted in, and certain songs being available for editing for a limited time.
Is this idea simple in theory but complex to implement? Undoubtedly. Nevertheless, discussing it is a promising beginning. Fan creation is already flourishing, and the music industry’s role is no longer limited to marketing. As fan creations outstrip the reach of original content, the industry must discover better ways to monetize these creations. While releasing accelerated versions of tracks on platforms like Spotify helps rights holders capture some of the trend-related revenue, it falls short of what fans desire – the ability to make these transformations themselves. Several companies, such as Hook, are striving to make this a reality, integrating these capabilities into social platforms is only a matter of time. The music industry, long interested in extracting more revenue from social media engagement, now seems eager to embrace new technology rather than confront it. Here lies an ideal opportunity to achieve both objectives.
Check out further thoughts on the subject here.