Microsoft and EY (formerly known as Ernst & Young) have teamed up to create a rights and royalties management application based on Quorum blockchain technologies that promises to dramatically reduce the overhead associated with managing contracts between publishers and the army of contractors most of them employ.
Developed originally by JP Morgan, Quorum is based on open source Go Ethereum blockchain technologies that have been crafted specifically for the financial services industry.
Paul Brody, global innovation leader for blockchain at EY, said Microsoft and EY chose to use Quorum because the underlying technology can scale to support as many as two million transactions per day. Microsoft will use this system on Microsoft Azure to manage payments involving gaming software partners. Once that model is proven, the rights and royalties management application will be made available to other interested parties, says Brody.
The goal is to replace the paper contracts that are widely used across the media and entertainment industry with “smart contracts” that will reduce the time required to onboard a supplier from roughly 45 days to one minute, says Brody.
Smart contracts may not necessarily result in anyone involved in creating content getting paid faster, but they do create the opportunity. Previously, it simply would not have been feasible to accelerate contract payments under any circumstance, says Brody.
“Now it can be a point of negotiation,” says Brody.
It may a while before smart contracts and machine learning algorithms transform how purchasing occurs between businesses. But at this point, it’s clear that transformation is only a matter of time.