High Hopes For Blockchain For Digital Copyright Protection

Blockchain platforms could help solve some copyright ownership issues for content sharing. But whether the technology lives up to its promise remains to be seen.

In theory, digital content could be permanently tagged with a unique ID once uploaded to the increasingly popular blockchain, which is often referred to as “distributed ledgers.” By doing so, many of the concerns about ownership of the content could be removed as copyrights remain protected when distributed with the platform, some say.

Payments and contracts can also be facilitated since all transactions are conducted directly between the creator and the purchaser for little to no fees. On some platforms, the artist might just upload the content to blockchain and then receive royalty payments from users. Payments could be based on contractual terms the artist specifies without concerns about losing ownership of the work since it is tagged.

“Blockchains are great tools for managing the ownership of assets and tracking the flow of money related to assets,” Paul Brody, Americas strategy leader, technology sector, for EY consulting firm, told Intellectual Property Watch. “In this respect, there is an opportunity to hugely simplify the management and ownership of digital rights and to create a much more transparent market that may result.”

Among other things, content uploaded to blockchain platforms can have unique embedded tags that serve to designate copyright ownership in an unmistakable way. Access to content on blockchain’s common ledger also requires an encryption key the owner of the protected work would have.

“Blockchain is a way of recording and ultimately proving who has what rights to what content and in a way that is immutable and unequivocal. That has always been a real challenge for media companies and content owners,” Martyn Whistler, lead analyst, media and entertainment sector for EY told Intellectual Property Watch.

“As the media industry undergoes transformation, with new ways of consuming content across new platforms and devices, the issue of rights ownership will inevitably become even more complex,” he said. “Blockchain simplifies complexity since it gives confidence to creators, producers, rights owners, distributors, and audiences that the content is being used in the right way.”

New Business Models

Blockchain thus has the potential to disrupt today’s media industries’ ownership and distribution business models. The ability to upload content to a platform for sale and distribution under terms the creator determines could also serve as a potential boon for content creators by removing different layers of content distributors. An author, for example, could sell digital copies of a book and receive royalties directly instead of passing by an Amazon. A film director could distribute a film directly to an audience without having to rely on a platform such as Netflix for payment.

“On blockchain platforms, the artists set the term of their contracts for compensation after they upload their work on blockchain,” Nicolas Maubert, a Paris-based attorney who specializes in IP, media, and telecommunications law, told Intellectual Property Watch.

More revenues can go directly to the intellectual property rights holder, compared to traditional distribution services that otherwise only pay a small percentage of revenues to the content creator, Maubert said.

“Blockchain is very appealing for artists, since they have the opportunity they never had before by getting a huge percentage of the sale of their work while their digital work remains protected,” Maubert said. “There is certainly a huge potential for blockchain’s development for content distribution.”

In addition to the comparably higher royalty payments content creators could receive from their work, blockchain contracts might only involve the creator and the buyer.

“What I do believe is that a blockchain-based market is a vastly more transparent environment. In that case, it would be possible for content creators to understand who is really capturing the lion’s share of value creation,” Brody said. “The accounting and financing of most TV, movie, and music content is extremely opaque today and anything that changes that would set the stage for dramatic industry upheaval.”

Filling the Void

While blockchain is a much talked-about platform given its potential, it still remains very new and has so far largely been used for financial transactions. Its wide-scale use as a popular distribution platform for copyright-protected content has yet to emerge.

US-based SingularDTV hopes to meet this need by launching a decentralized entertainment platform using blockchain technology. The company says content creators will be able to rely on the service to manage copyright protection and for distribution of their works. So far, SingularDTV’s platform remains in the beta stage.

For the moment, it remains to be seen if a single blockchain platform will emerge that users will adopt on a large scale.

“On paper, it’s entirely possible for creators to use the blockchain and manage their content in this way, dealing directly with audiences, but it’s unclear if that’s where the industry is heading. Remember, there’s a lot of upsides that media companies bring that may not be available to creators or even the kind of things they want to get involved with,” Whistler said. “This includes marketing, financing, talent development, user experiences, and, of course, how companies can also bring scale in audience and breadth of offering.”

The Caveats

While digital tags could serve as near-foolproof ways to identify copyright ownership of digital content, the platform will not necessarily be able to offer total protection against illegal copies of copyright-protected content. Making illegal copies on the platform will not be easy to do, yet blockchain so far does not offer many solutions for total protection against piracy much beyond what Netflix, Youtube, and other commercially available distribution networks offer.

“While a watermark or digital indicator may tell you where a piece of content originated, that does nothing to stop to the digital redistribution of that copy once it’s out in the open,” Brody said. “And knowing the source of the leak is not always helpful either as many unsophisticated users have their PCs compromised without their knowledge.”

While blockchain does not remove privacy concerns completely, it still has great potential to help to advance digital copyright protection and as a business model that could lean more in favor of content creators.

“The part of this idea that is viable is the direct payment and marketplace for digital content,” Brody said. “For honest users and the billions of revenue earned by streaming services and download companies says there are a lot of them, there is an opportunity to disintermediate some of the existing players and cut costs and increase artist payments.”