“Will 2022 be Hollywood’s Year of the DAO?,” VentureBeat asks.
The potential to democratize and decentralize decision-making and support, through the utilization of the Decentralized autonomous organizations, “will empower anyone, not just powerful producers and studios, to possibly tap the next Spielberg or Tarantino on the shoulder.”
Hollywood has long been governed by outsized institutions; from the Golden Age studios to today’s streaming giants, they’ve acted as the gatekeepers to Tinseltown.
Now, cryptocurrency, blockchain, and other decentralized technologies promise to break up the power of “monolithic, centralized middlemen,” as Decrypt puts it.
Hollywood is no exception: decentralized tech is perfectly poised, in theory, to disrupt the film industry and its incumbents.
David H. Steinberg, a contributor to HollywoodDAO, says the current studio system is overdue for an overhaul.
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“The problem with the system is that it’s very centralized,” he tells Decrypt. Studios have become a small group of “mega-corporations” whose focus is on shareholder profit. This means that they tend to make movies based on existing IP. “So that’s why you’re seeing a lot of superhero movies in the last 10-20 years; you see movies based on popular books, because there’s a pre-awareness. It’s driving away the original content.”
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The result, Steinberg says, is that indie films have been squeezed out. HollywoodDAO aims to build a more democratic system. The DAO initially aims to raise between $2 million and $5 million through a token sale, which will be used to finance a single project.
“We look at the function of HollywoodDAO as being a community-run treasury,” explains D.C. Cassidy, one of the organizers of HollywoodDAO. Filmmakers would pitch to the DAO using the same package and talent that they would any traditional studio or streaming business. The DAO community, based on the governance tokens, would then get to vote on which projects get financed by the treasury, he explained.
READ MORE: Roman Coppola’s Decentralized Pictures Is Shaking Up the Film Industry with Crypto (Decrypt)
“In the wake of social justice movements like #OscarsSoWhite and #MeToo, Hollywood should embrace such technological transparency as a tonic,” thinks VentureBeat. “If employed correctly, the use of NFT promises to be the most important thing for the process of film production since the indie film boom of the 1990s.”
A “codified DAO,” it argues, would be more empowering and liberating for both filmmakers and audiences.
“The potential of NFTs offer the ability not only for contributors to feel like [they’re] ‘tithing’ to the fan cult of their choice, but to create real ownership in a film property, both creative and financial.”
The Harvard Business Review says, “instead of working from a central office all year long and having two to four weeks off, most DAO contributors will likely work remotely, bond in virtual social spaces such as Cryptovoxels, and for several days a year, get together in real life for inspiring conferences and retreats.”
Naturally, there is resistance and inertia to change. Probably also some confusion about how DAOs, crypto, blockchain and NFTs actually work. There may also be concern about lack of regulation.
Decrypt thinks independent film financing will experiment with such Web3 models first — as they are increasingly blocked from conventional funding routes.
HollywoodDAO’s founders also expect incumbents like Netflix and HBO to embrace the decentralized upstarts.
“The content providers are starved for content,” says Cassidy. “I don’t think they look adverse either when they see an outfit who’s doing the hard work of development, financing production, and then they can swoop up at the end and say, ‘Great, here’s $20 million, we want to license the worldwide rights to the property, and you did all the hard work to develop it.’”
For the big players to actually get involved in crypto film financing will take time, even as these technologies rapidly evolve. For large companies such as studios to get on board, it will take assuaging the concerns of shareholders and other stakeholders.
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