In the current hype about the potential of NFT and blockchain to revolutionize funding and distribution of movies, the advocates we most commonly hear from are venture capitalists.
Clearly, they have a lot to gain by fluffing up the price of their investments in fledgling companies. On the other hand, the fact that major Hollywood studios including Fox and MGM are making fairly extensive plays in crypto-based initiatives suggests there could be profound change afoot.
Ahmed Shabana, managing partner at Parkpine Capital, which describes itself as an early-stage post-revenue VC fund, reports studio executives and their tech-fund managers “are keen to explore acquisitions of blockchain/crypto-backed entertainment startups that will speed up international distribution of films and products.”
Both Fox and MGM have signed a deal with blockchain platform Eluvio. Fox even owns a significant stake in the company, which was set up by the inventors of the file exchange technology, Aspera.
Eluvio and its Content Fabric platform support MGM’s distribution of screeners, pre-release screenings on local devices, and marketing and licensing support.
MGM is also one of several recent media companies to explore the viability of NFT distribution to support their IPs, partnering with VeVe to distribute digital collectibles for No Time to Die.
MGM is of course now part of Amazon, a company that knows a thing or two about the power of cloud and its potential to transform every aspect of content creation, production, distribution, and monetization.
No Time to Die signals the first time a major Hollywood production has received such backing, but further crypto-based financing for other Hollywood projects in general has the potential to upend the entertainment industry.
The indie film sector, which is almost definition the sector which struggles the most to fund projects, could benefit even more.
“The implementation of NFTs and the democratization of development through crowdfunding is an opportunity for all artists, but especially for the independent film landscape,” Shabana suggests. “With crypto and blockchain, the movie and entertainment industry is poised to reinvent its business functions, facilitating secure, transparent, and traceable transactions across the market.”
READ MORE: Why Hollywood is suddenly embracing the blockchain, crypto, and NFTs (Fast Company)
Blockchain technology is positioned to potentially transform “several processes within the media and entertainment industry for content security, license & rights management, digital advertising, and royalty distribution,” according to a recent report from Industry Research on the blockchain’s impact on the media business.
Piracy and secure access remain the greatest risks to the entertainment industry. According to Industry Research’s report, “With the help of blockchain technology, media, and advertising enterprises are able to eliminate fraud, reduce costs, and increase transparency within critical and time-consuming business processes. Further, blockchain technology helps the media and entertainment companies to effectively protect Intellectual Property (IP) rights.”
As a result, the global crypto and blockchain market size in the media and entertainment industry is expected to reach $1596.3 million by 2027, up from $466 million in 2020.
READ MORE: Global and United States Blockchain in Media and Entertainment Market Size, Status and Forecast 2021-2027 (Industry Research)
Parkpine Capital itself is launching a private investment syndicate with an investment capacity of over $3 billion to back the tech-based entertainment industry.
THE ABCs of NFTs:
Are NFTs just more hype, or are they actually the building blocks of the creator economy? Understanding blockchain technology can seem like a lot, but NAB Amplify has the expert knowledge and insights you need to remain at the top of the intersection of art and technology:
- NAB Amplify’s NFT Primer
- What’s the Real Future of the NFT Crypto Art Market?
- Weird Science: The Connection Between NFTs and… Human Nature?
- What Is the Value of an NFT?
- NFTs: Content Strategy or Digital Craze?
The current crackdown in China by the Chinese state on cryptocurrencies and the entertainment industry is not considered to be destabilizing in the long run. China recently banned crypto as part of a series of sweeping bans on everything from superhero movies to video games and representations within media — “all part of broader measures by the country to reduce risk in the system and stabilize growth that has been exponential in recent years,” suggests Shabana.
Indeed, China did permit the blockchain-backed No Time to Die to premiere on October 29.
“Despite recent turbulence in the markets, likely impacted at least partially by China’s regulator crackdown, crypto and the revolutionary blockchain technology behind it are here to stay. What we’re seeing right now may delay what comes next, but change is coming nonetheless.”