Dirt: What will the metaverse sound like?

An interview with DJ Skee aka Scott Keeney.

Dirt is a daily email about entertainment.

Daisy Alioto in conversation with DJ Skee about the future of music in the metaverse. DJ Skee aka Scott Keeney is the founder of the digital radio empire Dash Radio. He is credited with being the first to give Kendrick Lamar, Lorde, Biebs (and more) radio airtime. He also has an insane sneaker collection.

Daisy Alioto: What were the prevailing ownership and artist compensation structures when you joined the music industry and what have been the major changes that you've seen?

Scott Keeney: I started off as a DJ when I was a teenager and I got my big break when I wrote a letter to Steve Rifkind on what he was doing wrong with his label Loud Records at the time. The internet was coming in and starting to hit the music industry and people like Steve didn't know what to do. My thoughts and ideas were digital first. I was early to having a website and being a DJ online as a teenager at the time the internet was starting to take off. 

The music industry didn't realize the effect that the internet was going to have. And it decimated the industry, right? Because they stood in their own way. Instead of thinking of consumers first, they tried to think of their own pockets first. And they didn't want people to stream music because they were making so much printing discs. And that model was bound to evolve, but if you don't give it to people, they're going to find it their own way. I don’t think they would make that same mistake again. 

I started off as a mix tape DJ, taking samples and inspirations from others. It's the rawest form of distributing music and especially hip hop. That's how every major artist that came up at the time broke through–50 Cent, Jay Z, Lil Wayne. They all came from the mix tape game and the mix tape era. And there was no money from that. Music was a distribution tool and you put all your money back into manufacturing. I thought it was unfortunate at the time, but fortunate enough to treat music as being the most powerful marketing tool in the world, not relying on it to make revenue. It's almost always been like that for artists. If you look back in the '90s, you have the highest selling female group of all time, TLC declaring bankruptcy. Drake made 14 million in streaming revenue last year. And yeah, that's real money, but the number one artist in the world, if you look at the highest sports salary, it's more than that.

I think that music is the advertisement, you'll get it out, you'll make your little pennies off streaming and it can add up, it'll be a small portion of your income, but that's really an important tool to get your message out. Video games are free to play and they make money through additives. Fortnite has made billions of dollars selling virtual merch that has no competitive advantage in the game. So, I think that's my long way of saying how I've looked at music as a creator.

DA: How has the definition of a music experience changed. How did we go from Red Rocks to a Fortnite concert

SK: I think, for us, it was a trend that was already happening. COVID, obviously, accelerated it a lot, but I think if you're looking at where technology is, it's evolved to a place where we don't need to leave our homes to do a lot of different things. And I think you're going to see what's happening now is that there's multiple types of experiences, the same way that you can watch a movie: you could watch it on your phone, you can watch it on your TV. You can watch it on a flat screen TV. You can watch it in the theater.

The things that are going to work in Web3 are based on the same theories of what has worked forever in communal experiences, we’re just adding different layers that aren’t bound by the rules of physics. 

What's interesting about what's happening with NFTs is that it's not replacing a format. When format changes used to happen, it used to go from buying vinyls, to tape, to CD, to MP3's and now streaming and each one replaced the others. What's happening right now is, I think, purely additive. Ariana Grande is in Fortnite, Lil Nas X is doing Roblox. All these things are making real money for artists and it's not taking away from another thing.

And we're still so early on. I think the best use cases that we'll see, especially on the entertainment side, haven't even been really thought of, yet, to tell you the truth. Because we're still trying to adapt our old brains in the way that things used to work into this new world.

DA: Can you share how you're using your experience in digital radio to start building in the Metaverse?

SK: When we launched Dash, it was really to evolve the way that radio was done in the digital realm. And that's why we focus so much on smart speakers and the next generation of devices where we thought people would be consuming audio. Video games were always included in that category. 

When the pandemic started, we had just opened a 25,000-square-foot experiential physical space on Hollywood Boulevard and we had to shut that down. So we started looking at consumer behavior on these gaming platforms that aren’t just gaming platforms because people are there to have experiences and hang out. The game almost becomes secondary. 

We realized that our licensing rights, through radio, gave us the unique ability to embed our streams into these platforms. We're live, linear, as long as we follow those same formats we can embed our radio players and it's just another distribution touchpoint for them. Dash already serves as a hub for the curation of music. Any given day you can see artists like Billie Eilish and Post Malone coming by our studios. While we’re syndicating that content to cars and smart speakers, why not put it in games? 

This gives artists a new touchpoint to get their music onto these platforms without having to spend money to develop the promotion themselves when they release an album. Because not every artist is Ariana Grande, everything that we're talking about and that people are referencing is from the top 0.01% of artists. We want to create things that are accessible to every tier of artist. The last thing I’ll say is that when I grew up I was going home and watching TRL on TV. And I think that now kids are going into these different games and Metaverse-style experiences instead of watching TV.

DA: So rather than pressing play, the programming is ongoing. You tune in when you want. 

SK: We’re still having artists come to our studio and perform and do interviews but there are multiple ways to experience it. if you're there in-person, you can watch the artist. If you're listening on the radio, you can listen. If you're on YouTube, you can watch it. Maybe you’re in Fortnite or Paris Hilton’s world on Roblox. In these virtual worlds, you’ll be able to sit next to the avatars of those guests and celebrities and feel like you’re participating in the interview. 

DA: I wanted to talk about ownership with you because Taylor Swift's album is the biggest music story in my universe right now. Royalties already exist in music, of course. But do you see a way that this sort of shift towards the blockchain paradigm might have prevented a scenario like what happened with Taylor Swifts' archive?

SK: I don't know that blockchain would've done anything about that because I think there still could have been people that signed those deals and she would be bound by those contracts. 

In the blockchain, you’ll be able to see where payouts and royalties are going, so it makes things more transparent. And I think that will standardize the way that a lot of those deals can be done. Long-term it's inevitable that anything that has a royalty system like that is just more efficient on the blockchain. And I think implementing that will probably take a little longer than anticipated. There'll be other things that come first, but that's ultimately where we're going to go.

DA: There are ways that blockchain could make life more efficient for artists. But I read that you were one of the first people to play Lady Gaga, I'm sure most people don't know that. How could these tools we're developing actually make it easier to discover music or to discover artists?

SK: Yeah if you look me up you’ll see that I get credit but there was no way for me to invest in her. Artists that I played early on were already signed to labels, there was no way I could gamble on them or bet, there was no mechanism for that in the music industry though it exists in other places. If you believe in a company or a brand, you can buy their stock. Even in sports, you can bet, there's fantasy betting, there's gambling, there's buying sports cards.

And I think what's interesting about this next generation is through NFTs you’ll be able to document who your real fans are. I think what we’re seeing with Web3 is a community or fandom of people growing and prospering together. Imagine if you could invest in an artist early on and buy an NFT, like a rookie baseball card or a ticket from one of their first concerts, and it’s a smart contract. So they’re able to get a percentage of the resale if you sell that item as a collectible. 

Then imagine that artist goes on to become Lady Gaga. I'm the first one there. And I have the first token, what's the value of that? That's like a one-of-one rookie card we just bought. Going back to baseball cards, we spent a million dollars buying a one-of-one Mike Trout rookie card earlier this year. So, what is the value of something like that? It's significant.

DA: You’ve been in the music industry for a long time so you know there is huge discourse around selling out. What do you say to people who are skeptical of the tokenization of components of music that haven’t previously been quantified, who say, "Oh, nobody who loves music would actually want to do this."

SK: If an artist didn’t want to make money or be successful in music they wouldn’t put their CD out, right? There'd be no reason, they'd just play for themselves and their friends and do whatever they want. I think that if you're looking at what's happening with Web3 and blockchain, it's just an evolution of these payment systems. You're going to see cash grabs and things that aren't cool, and it's going to have a negative effect on it. But if you just dive in and look at it, this is the future of the way the entire world is going, not just music.

DA: In your dream scenario, how will people engage with music in the future?

SK: I think for the first time artists are going to be able to be fairly compensated for the influence of their work. It goes beyond the music transaction. I think a lot of times the music industry and people that look at music, they get caught up in the value of the sale of the actual, again, music product. The real value comes from everything else. 

Musicians aren’t just musicians, they are artists. Because you have to be more than your music, it's about what your visuals look like and your branding, the drops and the collaborations that you do. Fans will be able to be rewarded in that too, so the community elements will be incredible. We’re moving away from big, vast social media networks where everybody is just shouting to small, like-minded Discord channels where everybody gets along. The world is getting smaller even though we in essence have access to go anywhere.

The Dirt: We live in TRL.