We are not fooling anyone when we say that it is difficult for an artist to make a living off of their music. It is even more difficult during a global pandemic that practically canceled every live performance in the world, and that compromised almost all ads being shot, film, or series that would allow artists to make money off of sync opportunities… The ways to get money are considerably reduced and the pressure on streaming platforms is as strong as ever. So when platforms like Audius come to life, we are not surprised.
Audius is a streaming platform that allows artists to be properly paid for the work they upload on it. By wanting to pay them more than any other streaming platform on the market, it stands out from the rest and has made this possible thanks to… cryptocurrency. And not just any cryptocurrency: their very own called $AUDIO. In addition to this, the platform’s ease of use allows any artist to upload their catalog on it for free (and that will not change, according to them), do we have the future of streaming in front of us ? We thought an investigation was necessary.
Audius: a streaming platform backed by its own cryptocurrency.
At first glance, Audius’ features are very similar to those of SoundCloud’s: a familiar listening system. With the possibility of putting your content online by yourself and free of charge, official curated playlists, and the possibility of creating your own, Audius uses a formula that is familiar to everyone. While uploads and account creation are free on the platform, some content is accessible only if you buy their tokens ($AUDIO). This way, Audius “gives fans the exclusivity they deserve,” to use the platform’s words, including the possibility to participate in remix competitions.
90% of the platform’s revenues go to the artists
This is the platform’s manifesto. 90% of the platform’s revenues will go directly to the artists who will be paid according to the streams they have accumulated over time. If we still do not know how often these payments will occur, one thing is sure, it is that the payments promise to be generous. Shortly after its launch, the value of their cryptocurrency has exploded. A billion “tokens” were put online at the end of October, at an average value of $0.04 (source: Nairametrics). When a figure of cryptocurrency, Binance, announced to support Audius in their Binance Labs, their cryptocurrency value increased by 500%, rising to 20 cents. If you’re not familiar with the world of crypto, such an increase could seem ridiculous, and you’d be right to think so. In the world of cryptocurrency, it is rare to see a token skyrocket as quickly as Audius did.
In order to better understand how the platform works from the inside, we talked with SVDKO, an electronic music producer from Belgium who closely follows and uses Audius. He is one of the 10,000 artists who have received tokens from Audius for being veterans of the platform and having uploaded their music before the launch of the cryptocurrency. This gesture should be seen both as Audius distributing shares of their company and as disposable income, because it is possible to convert these $AUDIO into euros, in the same way that one can convert Bitcoin into actual currency.
“A whole set of factors come into play for an artist to make money on the platform – how many follows/likes/plays/reposts the artist has gotten but also the number of likes/reposts he has done on other compositions”
But apart from this exceptional gesture that took place on October 23rd, how can an artist really make money thanks to this platform ? SVDKO explains that there is “a whole set of factors that come into play for an artist to make money on the platform – how many follows/likes/plays/reposts the artist has gotten but also the number of likes/reposts he has done on other compositions”.
Audius has posted on their blog a formula that allows us to understand the factors that came into play for the first wave of payments, a formula that is highly sought-after by any artist and any label putting their works on streaming platforms. Our investigation has led us to what follows.
How much is a stream worth on Audius?
• A precise formula is available…
• … but it only corresponds to the precedent wave of payments performed on October 23rd…
• … and the next payment has not yet been announced.
On their blog, Audius unveils the following formula:
Score = (0.75*least(streams_on_your_content,2500)/2500) + (0.1*least(followers,1000)/1000) + (0.05*least(favorites_on_your_playlists, 100)/100) + (0.05*least(favorites, 100)/100) + (0.05*least(reposts,100)/100)
Audius explains some of the values: 75% of the score corresponds to the number of streams you have accumulated, 10% to the number of followers you have, 5% to the number of favorites you have on your playlists, 5% to the favorites accumulated on your tracks, and finally, 5% granted to the number of reposts. This shows that the remuneration was and may not only be based on the number of streams you accumulate. Your activity on the platform as well as the users’ interest in your music (reposts, favorites) counts as well! SVDKO explains that “the good news is that everyone gets paid on Audius, artists and listeners ! The key is to really be active”.
Let’s continue our analysis of the calculation, focusing on one of the variables: the streams.
Here is a guide to understanding the values :
– 75% of the payment is allocated to the number of streams
– “least”: this means that the highest value in parenthesis will be taken into account. If you have less than 2500 streams in total, the value taken into account is 2500. If you have made 3000 streams, the value taken into account in the calculation will be 3000.
– comma “,”: this is simply a way for the algorithm to select the strongest value.
– /2500 : arbitrary variable
Once again, it is difficult to know if this formula will change. The administrators of Audius’ Discord server say they do not yet know when or how the next $AUDIO drop will take place. This is why it is important to take this formula with a grain of salt.
A formula that should not be taken for granted
Information to remember:
– The $AUDIO has a fluctuating value.
– Audius is not paying you in your local currency but with their very own token, the $AUDIO , which can be seen as a stock market investment and can be exchanged for local currencies.
First of all, the value of the token is fluctuating, the same way a stock market share would be, or, for those who invest in crypto-currency, like the value of Bitcoin. It’s worth noting that the $AUDIO has seen a lot of fluctuation in its value. If we were to follow the formula we could see that if the token is valued at 0.10$ then your music could be bringing you in 1000$ when your payment arrives. On the other hand, if the token was to drop to 0.05$ then you would only receive 500$. So you have to keep an eye on its fluctuation and be comfortable with the idea that the value of the stream is and will always be fluctuating.
Secondly, and this is probably the most important point to keep in mind, your Audius account is not a bank account on which euros are stored, but rather an investment on the stock market. An investment that you then have to exchange to be able to convert it into current currency. You can’t just withdraw this money the way you get some cash at the ATM. You have to find a buyer on the $AUDIO market who, when you want to sell your tokens, wants to buy them from you. This can happen very quickly if not instantly sometimes if you match the person’s asking price. But if you’re looking to sell at a higher price than the market’s price, then you might have to wait a while till the market catches up to your selling price, or you lower your standards.
With nearly 750,000 monthly active users, 1 million streams per month, and major electronic figures such as deadmau5, Rezz, and Baauer on the platform, Audius’ success seems already assured, not to mention that Audius also hosts remix competitions whereas SVDKO tells us the goal is too “make a track with the provided samples & stems and the goal is to be as creative as possible – all this with a lot of visibility and often a prize at the end of the day !” Audius is a promising platform, which could possibly take over SoundCloud, but there are still many unresolved problems, and some of them could cause major issues for labels and other artists in the music industry.
Giving the ability to upload anything you want causes copyright infringement issues
Copyright infringement is the main issue with the Audius platform.
Audius says “no content can be censored or deleted” by them from their platform, and SVDKO explains that “by being a completely decentralized platform, it is impossible for the Audius team to remove the composition/remix or other content – only the artist who put it on Audius can do so”. This could eventually cause major issues for labels as well as for songwriters if a “copyright claim” system is not put in place. We will keep an eye on what Audius will do to match the industry’s requirements. In any case, we hope for a quick response from them on this matter.
Audius exists in the form of a website as well as a desktop and mobile application. You can find all the information on their website.
Sources: Audius, Binance, Presse Citron, Nairametrics, The Verge.
Special thanks to SVDKO who has been really helpful when providing information for this article ! You can follow him on Instagram as well as on Twitter, and his first EP “It’s SVDKO” can be found on all streaming platforms.