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The people receiving royalties are the artists in these cases – instead of the record companies, instagrams, and etsys of the world. I fail to see how this won'

The people receiving royalties are the artists in these cases – instead of the record companies, instagrams, and etsys of the world. I fail to see how this won't be a net positive for wealth equality when we're shifting the advantage to those who have historically been taken advantage of.

AlexandrB 5y ago
This is not a property of NFTs, but rather of new, unproven technologies. If NFTs "make it big", there will be plenty of middlemen that spring up to "help" artists sell NFTs while owning the IP rights and collecting royalties.
- dschnurr 5y ago
  Sure there will be middlemen trying to profit due to asymmetry of information / technical knowledge. But as technology marches along the barriers to entry of launching new things trends to zero. Smart creators are increasingly harnessing new technologies to cut out existing middlemen. Podcasts are a great example of this, anyone with a microphone can start an entertainment business now and collect money from direct relationships with advertisers.
  - jjulius 5y ago
    >Podcasts are a great example of this... And yet plenty of middlemen exist for podcasts, too - Earwolf, Stitcher, yadda yadda. Sure, barriers to entry trend toward zero, but that doesn't mean everyone's going to see what you're selling. Many people will need to partner with someone who can help get their shit in front of people who want it, and those partners are going to want a cut. Record labels, Instagrams and Etsys will show up to the NFT party in spades.
  - AlexandrB 5y ago
    I think the big news in Podcasts is centralization. Many new podcasts get their money either from "networks" or by being part of one of the podcast walled gardens (e.g. Spotify). I suspect traditional podcasts will go the way of blogs soon and be largely superseded by several competing commercial platforms (think Medium). See, for example, the moves by Apple to turn their Podcasts app into a subscription platform: https://www.apple.com/newsroom/2021/04/apple-leads-the-next-chapter-of-podcasting-with-apple-podcasts-subscriptions/ https://www.apple.com/newsroom/2021/04/apple-leads-the-next-...
billytetrud 5y ago
There's a difference between making royalties for distribution of copies of an item and making royalties for transferring a single item from one person to another. One makes sense, the other is a weird misleading way to rent to people.
- mattbeckman 5y ago
  Transfers are not necessarily sales. Transaction fees for the Topps MLB cards on WAX, for example, are only taken during the sale when the sale occurs on a secondary Atomic Asset marketplace. There are no royalties to trade or transfer between accounts.
- mattdesl 5y ago
  Royalties apply on re-sale, not every transfer. Royalties on sales going back to the original creator is pretty normal practice in the arts and creative industries (music, writing, art, photography). The good thing, compared to traditional markets, is that this is something that can be (loosely) enforced with smart contracts, the % rate is flexible, and the current NFT royalties are typically far better for the artists (eg: 10% NFT platform fee instead of 50% gallery fee).
  - lottin 5y ago
    What on earth are you talking about? If I buy a copyrighted work in the second-hand market I don't have to pay any royalties to the original creator. That would be extortion.
    - mattdesl 5y ago
      You are free to do the same (trade w/o fees) with crypto currencies, nothing stops you from sending the tokens directly from one wallet to another or doing a private sale. But with galleries in the real world (where artists are “represented” - and the model that NFT marketplaces are emulating), the artist will receive royalties on sales.[1] [1] - https://www.dacs.org.uk/for-artists/artists-resale-right/in-detail https://www.dacs.org.uk/for-artists/artists-resale-right/in-...
klodolph 5y ago
> The people receiving royalties are the artists in these cases... This is just factually incorrect. I don't know why there's so much confusion here... it's the creator of the NFT that controls where the money goes, not the creator of the artwork. I don't know why people think that it's the artist that gets the money--that doesn't make any logical sense--how would a system like that even work?
- dschnurr 5y ago
  The creator is almost always the artist. Provenance is what gives NFTs their value. The value of a Beeple NFT minted by a random user is $0.
  - geofft 5y ago
    The value of a Beeple NFT minted by a random user is exactly what the market chooses to value it as. If it's minted by an agency that helps creators do marketing, and the agency gets the creator to say "Yes, this is a legitimate NFT created on my behalf by this agency, which has been very helpful to me in understanding NFTs, I don't understand these fancy computer things," why would the value be zero? (This exact scenario plays out all the time in the real world. People bought "Taylor Swift's" album Fearless, which was authorized by her and contained her actual voice and songwriting and paid profits to her and was in all senses legitimate, and paid well over zero dollars for it. And then over a decade later she tells her fans that she doesn't control it and she's recording her own version of the album actually owned by her.)
  - AlexandrB 5y ago
    What stops a record company from including a clause assigning any NFTs (and/or the revenue therefrom) created by the artist during the contract term to them?
    - pmulard 5y ago
      Nothing. Just like nothing stopped Taylor Swift from rerecording her entire library to license her music herself. If artists sign their NFT rights away, that's on them.
lottin 5y ago
These are not royalties. Royalties are paid when you buy a copy of a copyrighted work. And your not paying royalties again if the previous owner has already paid them.

AlexandrB 5y ago

This is not a property of NFTs, but rather of new, unproven technologies. If NFTs "make it big", there will be plenty of middlemen that spring up to "help" artists sell NFTs while owning the IP rights and collecting royalties.

dschnurr 5y ago
Sure there will be middlemen trying to profit due to asymmetry of information / technical knowledge. But as technology marches along the barriers to entry of launching new things trends to zero. Smart creators are increasingly harnessing new technologies to cut out existing middlemen. Podcasts are a great example of this, anyone with a microphone can start an entertainment business now and collect money from direct relationships with advertisers.
- jjulius 5y ago
  >Podcasts are a great example of this... And yet plenty of middlemen exist for podcasts, too - Earwolf, Stitcher, yadda yadda. Sure, barriers to entry trend toward zero, but that doesn't mean everyone's going to see what you're selling. Many people will need to partner with someone who can help get their shit in front of people who want it, and those partners are going to want a cut. Record labels, Instagrams and Etsys will show up to the NFT party in spades.
- AlexandrB 5y ago
  I think the big news in Podcasts is centralization. Many new podcasts get their money either from "networks" or by being part of one of the podcast walled gardens (e.g. Spotify). I suspect traditional podcasts will go the way of blogs soon and be largely superseded by several competing commercial platforms (think Medium). See, for example, the moves by Apple to turn their Podcasts app into a subscription platform: https://www.apple.com/newsroom/2021/04/apple-leads-the-next-chapter-of-podcasting-with-apple-podcasts-subscriptions/ https://www.apple.com/newsroom/2021/04/apple-leads-the-next-...

billytetrud 5y ago

There's a difference between making royalties for distribution of copies of an item and making royalties for transferring a single item from one person to another. One makes sense, the other is a weird misleading way to rent to people.

mattbeckman 5y ago
Transfers are not necessarily sales. Transaction fees for the Topps MLB cards on WAX, for example, are only taken during the sale when the sale occurs on a secondary Atomic Asset marketplace. There are no royalties to trade or transfer between accounts.
mattdesl 5y ago
Royalties apply on re-sale, not every transfer. Royalties on sales going back to the original creator is pretty normal practice in the arts and creative industries (music, writing, art, photography). The good thing, compared to traditional markets, is that this is something that can be (loosely) enforced with smart contracts, the % rate is flexible, and the current NFT royalties are typically far better for the artists (eg: 10% NFT platform fee instead of 50% gallery fee).
- lottin 5y ago
  What on earth are you talking about? If I buy a copyrighted work in the second-hand market I don't have to pay any royalties to the original creator. That would be extortion.
  - mattdesl 5y ago
    You are free to do the same (trade w/o fees) with crypto currencies, nothing stops you from sending the tokens directly from one wallet to another or doing a private sale. But with galleries in the real world (where artists are “represented” - and the model that NFT marketplaces are emulating), the artist will receive royalties on sales.[1] [1] - https://www.dacs.org.uk/for-artists/artists-resale-right/in-detail https://www.dacs.org.uk/for-artists/artists-resale-right/in-...

klodolph 5y ago

> The people receiving royalties are the artists in these cases... This is just factually incorrect. I don't know why there's so much confusion here... it's the creator of the NFT that controls where the money goes, not the creator of the artwork. I don't know why people think that it's the artist that gets the money--that doesn't make any logical sense--how would a system like that even work?

dschnurr 5y ago
The creator is almost always the artist. Provenance is what gives NFTs their value. The value of a Beeple NFT minted by a random user is $0.
- geofft 5y ago
  The value of a Beeple NFT minted by a random user is exactly what the market chooses to value it as. If it's minted by an agency that helps creators do marketing, and the agency gets the creator to say "Yes, this is a legitimate NFT created on my behalf by this agency, which has been very helpful to me in understanding NFTs, I don't understand these fancy computer things," why would the value be zero? (This exact scenario plays out all the time in the real world. People bought "Taylor Swift's" album Fearless, which was authorized by her and contained her actual voice and songwriting and paid profits to her and was in all senses legitimate, and paid well over zero dollars for it. And then over a decade later she tells her fans that she doesn't control it and she's recording her own version of the album actually owned by her.)
- AlexandrB 5y ago
  What stops a record company from including a clause assigning any NFTs (and/or the revenue therefrom) created by the artist during the contract term to them?
  - pmulard 5y ago
    Nothing. Just like nothing stopped Taylor Swift from rerecording her entire library to license her music herself. If artists sign their NFT rights away, that's on them.

lottin 5y ago

These are not royalties. Royalties are paid when you buy a copy of a copyrighted work. And your not paying royalties again if the previous owner has already paid them.