In an era dominated by streaming giants like Spotify, independent artists often find themselves grappling with the challenges of visibility, fair compensation, and the complexities of breaking into the mainstream.
As traditional streaming platforms fall short in providing equitable opportunities for some artists, NFTs (non-fungible tokens) are being hailed by some as a game-changer, offering independent artists a lifeline to not only thrive financially, but also to forge direct connections with their fan base.
Back in May, B2B music streaming technology company Tuned Global partnered with Revelator, a digital IP infrastructure provider for music, to integrate NFTs into music streaming platforms. The partnership allowed Tuned Global customers to mint, sell, distribute, report and track music NFTs.
California-headquartered music streaming service Audius is another player in this field, offering ‘superfans’ the opportunity to pay a premium for access to digital products from their favorite artists.
Now, another market entrant is jumping into the field, although with a twist. After raising $6.9 million in its seed funding round, Los Angeles-based Web3 streaming protocol Sona, co-founded by Jennifer Lee (aka producer and DJ TOKiMONSTA), has launched its streaming platform in open beta.
The ad-free streaming platform uses DeFi (decentralized finance) building blocks to help artists stream content, manage rewards, conduct auctions and more.
“We’re building a new pathway for artists to capitalize on their creativity, connect with superfans and enjoy more control over their work.”
“We’re building a new pathway for artists to capitalize on their creativity, connect with superfans and enjoy more control over their work,” Sona announced on social platform X on Wednesday (December 6).
The company says the platform is a new economic model for streaming and for more innovations built on the Sona protocol.
“Music is everything at Sona. The tech startup is at the forefront of music industry innovation by tilting broken streaming economics in favor of artists and making the industry more fair, equitable and rewarding for both artists and fans,” Sona said on its website.
Sona merges free music streaming with a marketplace, allowing fans to purchase “SONAs” or “digital twins” of their favorite songs and earn a share of the streaming rewards on the platform.
In a departure from traditional streaming platforms, Sona operates without ads or subscriptions, relying instead on Sona purchases as its revenue model. The company says this approach provides fans with a new channel to support their favorite artists, while artists can tap into an additional revenue stream without affecting their existing income.
Sona claims to adopt a human-led curation approach, diverging from algorithm-based systems.
“This promotes organic growth, freeing artists from the constraints of algorithms and centralized editorial directives,” the company said.
The platform also offers a “dual-revenue system,” which involves the pro-rata distribution of streaming rewards based on the percentage of total streams and the Sona marketplace, where fans can acquire ownership of specific song rewards.
The $6.9 million seed round was reported by TechCrunch, citing the company. Financing was led by Polychain Capital, Haun Ventures and Rogue Capital. The funds will be used to hire engineers and develop new features for the platform.
“The artist and rightsholders retain 100% ownership of the original song — so that’s a bit different and why we don’t really see ourselves as a music NFT platform. We’re focused on the relationships between artists and fans.”
Jennifer Lee, Sona
TechCrunch explains, citing the company, that the Sona marketplace allows artists to auction their SONAs or digital assets of songs to collectors for 24 hours. The artists then set a minimum bid price and sell to the highest bidder.
The news outlet noted that the owner of a SONA receives 70% of the streaming payout rewards based on a pro-rata share of total streams on the platform, while artists get 30% and the company takes a 7% fee. The platform also offers a rewards pool that is funded from a percentage of SONA sales.
“It’s pooled every two weeks and then redistributed to every artist and collector, proportional to how much [the specific song] is streamed,” Co-Founder and CEO Laura Jaramillo was quoted by TechCrunch as saying during a private demo.
“So, you’re paying artists for their work quickly, incentivizing the creation of that work, and then also rewarding the people that are actually supporting those artists.”
Sona is not positioning itself as a traditional music NFT platform, noting that SONAs are not related to royalties from other streaming platforms, but that rewards are from the Sona ecosystem only.
Sona Co-Founder and CXO Jennifer Lee said: “The artist and rightsholders retain 100% ownership of the original song — so that’s a bit different and why we don’t really see ourselves as a music NFT platform. We’re focused on the relationships between artists and fans.”
According to Jaramillo, Sona’s approach addresses the challenges faced by independent artists in building an audience and generating sustainable revenue. Jaramillo, a long-time NFT product designer, conceptualized Sona to assist her mother, Puerto Rican artist and activist Raquel Gonzalez, as well as other artists experiencing similar struggles, TechCrunch said.
To date, Sona’s streaming service boasts over 5 million tracks, with plans to expand its catalog to 16 million songs by next year. The platform is set to host its first-ever auction on December 7, featuring TOKiMONSTA’s 2017 Grammy-nominated track Rouge.
Music Business Worldwide