The past decade has seen much of our consumption change from "owning" music, to something more akin to renting it - with physical releases and collectables suffering as a consequence. However, we may be on the cusp of a revolution, as Non Fungible Token (NFT) technology makes it possible for us to have real, tangible ownership of digital products. But for an industry so traditionally physical in its output, is it possible to digitise completely?
RCRDSHP is a platform looking to do just that, providing digital renditions of collectables and artist merch in a way that can be monetized effectively, an alternative for artists caught in a web of low-royalty payments for streaming. RCRDSHP was founded by Obie Fernandez, whose love of music first began perusing his grandparents vinyl collection, "I've been obsessed with music since I was around 14" he says, "and I've been a bedroom producer since 2001."
We sat down with Fernandez to talk about the possibilities of NFT technology, decentralisation and doing right by artists
So could you tell us a little bit about establishing RCRDSHP? You're an avid music fan, right? How did you come up with the idea of melding together NFTS and music?
I started working on my music career and seriously releasing music about five years ago - at the same time I've also had a very successful technology and entrepreneurship career, including a very successful startup called Andela, which is now operating in 14 countries and helping lots of young people in developing nations become world-class software developers. So I'm used to working on big ideas and In January of this year, when I was feeling the itch to do something new, I started looking into what potential there was to do something that would meld my experience with technology and my love of music. I've always kind of considered that my holy grail. And what really caught my attention was the emergence of NFT-related projects, and my head exploded with ideas for how to use that technology in the music space.”
At first, it was all related to a large vinyl collection that I have. I was kind of wishing I could turn them into NFT's by shipping them off to a vault somewhere. I travel the world as a digital nomad and that really isn’t consistent with lugging 25 boxes of records around [laughs]. So I was trying to think up some sort of digital representation of them, something I could externally access without having to have them in my hands. From that, I kind of started iterating on different ideas related to music and saw the success of NBA Top Shot and decided to build something similar but for electronic music.
Do you think music collectables are going to be sold primarily as NFT's in the future? Do you think this is where this is going?
I think that NFT is a useful and fundamental technology for certifying the authenticity of limited-edition goods. Music hasn’t really been sold widely as a consumer good for around 10 years - maybe 20 at this point since Napster happened and people stopped buying CDs - and that’s had a devastating effect on a lot of working artists. An NFT’s function is to create a limited edition digital signature. To me, people would buy an NFT backed digital collectable for the same reason they would buy a vinyl record. So many people that buy vinyl now aren’t necessarily playing them, sometimes they don’t open them, it's to be part of a collection. So in that case it’s just a physical token of ownership. So with that in mind, and being very familiar with the dynamics of the vinyl market, it just seemed like a no-brainer that people would eventually do something with digital items - they are much more convenient.
What do you think is like the big benefit to a music fan is by owning merchandise and collectables in a digital format?
It's just a very 21st century way of approaching collecting. Having physical items is cool, you know you can put a poster on your wall and whatnot. I don’t think that would ever lose its appeal - But physical items are also inconvenient, right? You can lose them, you can damage them, they can be stolen. I love telling this story, but once I got a poster from a Solarstone. show, the first that I’d promoted in Atlanta - I wanted a memento, it was raining and it fell into a puddle, ruined. So when I was starting RCRDSHP, I thought of that story pretty often because I was envisioning a situation where you could have a poster or a ticket stub or something like, in a digital format. I think kids today, not to sound really old, but younger generations are used to having digital items and paying for them - look how much people pay for Fortnite skins or other items in video games. A lot of the time in those cases those things are just collector’s items, they don’t even add utility to the game. So I think it's just a matter of time before we have viable avenues like RCRDSHP for musicians to monetize these kinds of things on a wider scale.
How do you see the industry of collectables and merchandise changing in the next few years? Will digitisation be at its core?
I think that there are very plausible, financial reasons to think that almost everything will become digitised, even physical items will have to do digital imprints and backed counterparts. Even stuff that we don't normally think of as collectables - you know if you buy a Jean Paul Gaultier coat, a really fancy one, it might have a QR code in it that gives you the digital representation and you can put it on your avatar. The whole 3D avatar thing is probably going to be big business in the future. So RCRDSHP addresses that for our partner artists as well because we create digital merch: t-shirts, caps, that kind of stuff. We do see that as being transmittable to the metaverse.
So is the metaverse something that you are focusing on right now?
We haven't specifically invested in any one particular platform, there are several sites like Decentraland and Sandbox where people are building clubs and expect rave-style experiences. Call me old school, and I know I’m old school like my first rave was a Frankie Bones party like years ago, but I’m a big believer in real-world events. It’s difficult for me as a long-time DJ to understand how you could possibly replace that, although COVID is making it appealing. I see it as being more of a component. If at some point we all have digital representations of our lives in the metaverse, you’re probably going to want to have a music collection you and your friends can check out.
So do you think RCRDSHP is pioneering this element of digitising? Will other organisations and labels follow suit eventually do you think?
We’re certainly one of the companies that are doing it in a scalable way. Our approach is super artist-friendly, we are not aiming to be like Spotify, Google or Apple – as we are providing artists with a completely new and different revenue stream. RCRDSHP and our parent company, Let The Music Pay has been established by me and a whole lot of other musicians with the artists at its core. Our intention isn’t really selling out and becoming a big monster thing that disconnects artists from their fans. In fact, the opposite is true. We’re big believers in Web3 and principles of decentralisation, and connecting artists to their fans in a way that hasn’t been possible before.
At what point do you feel like NFT technology will be dominating how we buy everything? Is that a line that could be crossed?
I think there's certainly a tipping point and it could happen much faster than anyone imagined. Because there's a bit of a positive feedback loop. What I mean by that is when an artist comes on our platform and they're able to successfully activate their fans, they see huge increases in the revenue that they can make, and everyone's happy. It's not like the fans are feeling exploited, they're getting something cool from you, right? Then those artists go and talk to their friends who are also artists, and then they reach out to us and say they want to do it. So there's kind of this exponential explosion possible, assuming we do our job, we execute well enough and make a scalable platform we should be able to, to rapidly accommodate the kind of growth that it would take to make a tangible difference in people's lives. I think the more and more that the artists see that there's a viable alternative to the grind of streaming platforms plus touring, plus whatever else people do to survive and pay their bills they will flock to blockchain-backed projects.
I think NFT is a fad right now. When artists ask me how I feel about NFTs I say: “I’m an artist. I work in a studio. I make music - I don’t make NFTs. I make EPs and albums.” For us the technology is just to prove authenticity - for example, if you have a wine bottle, most have a little hologram sticker that proves that bottle of wine came from the region it claims to be from - that's all the NFT is. It’s become a fad to own an NFT and there’s a bro culture around it and the fact that it’s so deeply rooted in tech and libertarianism is a huge turnoff for a lot of hardcore music fans. It’s so nerdy it’s cringe, right? So there’s now backlash - even I see leading music platforms getting involved in them and I’m thinking - it’s super fucking cringe. If you go to RCRDSHP, you’re not going to see the word “NFT” anywhere. That’s on purpose because for us NFT is simply a mechanism to reliably certify that something is a limited edition item. That’s it. So you know it is what it claims to be, that is it.
Is there a dream bit of merch or a collectable that you’d like to see in RCRDSHP?
There are some compilation CDs that I've subsequently lost and I don't even have any idea where I would begin to find them again. Yesterday a friend of mine they were playing ‘Insomnia’ and I said: “This is the song that got me into trance,” and they said “this version” and it wasn’t the [Faithless radio edit] version, the way I remember it, it didn’t even have a vocal. I remember the CD it was like an Italo disco style compilation and it had these trancy plucks - must have been released in about ‘94-’95. But, god, I wish I had that CD. I played it to death for several years and I lost it - it was kind of an eye-opener for me because I was this real New York house music guy and this changed my viewpoint. So I wish I could find some of those things as limited edition digital collectables and get high-quality audio from them. Maybe that's a little weird.
But the thing is the reason that a lot of this stuff isn’t available is that it’s not worth anyone’s time or money to be digitised. If even torrenting groups aren’t uploading it, it means it isn’t commercially viable. However, if you create a platform where there is some money that can be made, in the way that would make from CDs then hopefully some of those rights holders would come out of the woodwork.
Can you tell us about any kind of really exciting projects you have coming up at RCRDSHP?
Yep, the Fat Rat, who maybe some people haven’t heard too much of but I have - because I have a 13-year-old son. Um, so it was funny when he popped up on our radar - I had a zoom call with him and my son was hovering on the periphery the whole time, so I think that is the reason it’s so exciting for me personally [laughs].
This music is brilliant, don't get me wrong, but he also has this huge conceptual universe. He's got all this lore and storylines and characters and plot - he has sketchbooks, and he writes down all the notes for all these things that he's creating as he's composing and making characters. To me, that is the pinnacle of how an artist should think and maximise the potential for collectables - going down the rabbit hole of concept art and big thinking and a big imagination, and he's so characteristic of that. So we’ve done a couple of drops for him already, we’ll probably do a few more - the content is just stunning, and the audience certainly seems to love it. He's got a big following.
Do you want people to change their attitudes towards blockchain?
I think I think the most important thing to realise is that there's a lot of people out there who just react badly to anything having to do with it, without really thinking. Because they heard Bitcoin destroys the earth or Ethereum costs the whole energy consumption of Germany to do a transaction, that kind of thing. But there’s such a big world of blockchain and crypto - it's easy to overlook the fact that a project like ours, with founders that are very environmentally conscious, we purposely went with the Flow Blockchain because the transactions don't cost any more than like swiping your Visa card. We see comments so much when artists are showing off their packs or upcoming collectables and people will be like: “We hate you, you’re killing the earth.” It’s like, Jesus get a clue.
In time I think there’ll be understanding and maybe it’s up to us who are leading the charge to educate everyone on how this all works. It’s important to understand that artists aren’t selling out because they are going to make 10 grand on an NFT drop, because 10 grand would be what an artist might make over the lifetime of a track on streaming platforms - if they are successful. You would never see that kind of money if you’re a smaller artist, so it really makes a difference.