Artists and music rights holders are increasingly turning to the metaverse(s) as a means to reach a wider, global fan base and explore new revenue streams, whether by curating concerts like Lil Nas’s performance in Roblox which attracted 33 million streams or by partnering with the likes of Spotify to create a digital “island” inviting users to explore their music and interact with it in real time.
In this article we explore three key aspects of exploiting existing music in the metaverse, or more likely, across different metaverse(s).
Curating digital concerts
Similar legal considerations to those which apply to any concert in the physical world will be relevant when you are intending to broadcast/stream a concert in the metaverse(s). Rights holders should consider who will own the copyright in the recording, how long it should be available for (with the added consideration as to how and who will be responsible for implementing measures that restrict any unauthorised copying and subsequent distribution of the concert) and any exclusivity to be granted to the metaverse in question or any brand or sponsor involved.
A unique aspect to consider with a metaverse concert is the use of an artist’s image rights given that most digital concerts will involve some form of avatar. Assuming the avatar is created by a third party, it is important to consider who will own the rights to the avatar as it is the copyright of the digital creator but featuring distinctive artist features. Should there be any exclusivity to the metaverse (platform) the avatar is being used in and/or limitations on its use? Will it be available for other users to play in game (perhaps subject to a fee per use)?
Maximising ancillary income
There appear to be a variety of opportunities to maximise income in the digital worlds, with relatively lower costs associated with them, compared to their physical counterparts. One might think of a metaverse collaboration like a brand collaboration, as it allows artists to create and sell both digital and physical merchandise as part of the collaboration. Take, for example, the skins created as part of Travis Scott’s 2020 concert in Fortnite, which continue to be one of the rarest skins in the game and remain highly desirable (allowing the artist to create a certain hype) or Spotify’s “Islands” project through which it encourages the artists it collaborates with to engage with digital merchandise by partnering with Spotify on the creation of in-game virtual merchandise. Spotify have said that its portion of such sales will go directly to the artists themselves.
A key part of the metaverse(s), and often an attraction of a digital community, is the ability to interact with the content, allowing consumers to create their own versions or adaptations. User generated content (UGC) therefore also offers opportunities for additional income. The music rights holder could try to negotiate a royalty or share of income on such UGC exploitation similar to the current practice on YouTube, depending on their bargaining powers. Rights holders should consider when entering into agreements with a metaverse who will be responsible for payments from any UGC and compliance with any user policies and rules.
To maximise the opportunities brought by the metaverse(s), licensing will need to be efficient and accurate. However, as the concept evolves with Web 3.0 in order to create an interoperable metaverse and an increasingly complex web of contributors, users, music rights holders, platforms, third party content owners and advertisers, it may become less obvious as to who should bear the burden of licensing music in the metaverse(s). As a music rights holder, it is advisable to consider what rights, if any, such contributors should have to your music and what rights you require in turn, for example to use UCG featuring your music or utilise any brands or the platform involved in the collaboration.