Blockchain has the potential to disrupt the way content is produced, aggregated, distributed and consumed — and the possibilities for content creators, brokers and arbiters of intellectual property are too big to ignore.
Major studios, angel investors and crowdfunding platforms are actively exploring the potential impact of blockchain and cryptocurrency access and investment on the entertainment industry.
Although blockchain is still most associated with cryptocurrencies like bitcoin, the emerging technology has the potential to offer multipurpose business applications for a range of industries.
“Media and entertainment offer an interesting use case because of two challenges the industry has struggled with as content has gone digital: the ability to protect as well as monetize intellectual property,” says banker JP Morgan. “For media companies, blockchain has industry-wide applications that can transform the way content is created, consumed and protected.”
READ MORE: The Future of Blockchain in Media and Entertainment (JP Morgan)
Funding to blockchain companies doubled between 2017 and 2020, according to CB Insights, and actual spending is expected to reach $16 billion by 2023. While the most visible changes thus far have been in the financial sector blockchain’s gaining popularity is set to have a lasting impact on the entertainment industry.
READ MORE: 58 Big Industries Blockchain Could Disrupt (CB Insights Research)
According to Tony Fountain in an article for Rolling Stone, entertainment executives are starting to identify how it can impact their businesses. “Smart contracts, which are powered by the blockchain, could influence entertainment agreements, providing a secure alternative to traditional negotiations, ensuring reliable payment of creators, a more seamless way to work with the crew on global projects and eliminating the red tape that hampers many large projects.”
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Blockchain might even produce entire feature films. According to Stephen Graves at Decrypt, there’s an appetite for a crypto-powered approach to film financing.
“Everybody is very, very interested because it’s an alternative way to access capital, to tap a global audience, to be able to empower and create an audience and create alignment with that,” Gorav Seth, co-chair of Mogul Productions, tells Graves. “I think it’s very, very interesting to everybody in independent film financing — and the entertainment industry overall.”
Film and TV veteran David H. Steinberg, one of the leading contributors to HollywoodDAO, a decentralized autonomous organization for filmmaking, says the problem with the current system is that it’s very centralized.
“As a result of mergers, the studios have become a small group of ‘mega-corporations’ whose focus is on shareholder profit,” Steinberg tells Graves. “That means that they tend to make movies based on existing intellectual property. 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.”
Instead, HollywoodDAO aims to build a “more democratic” system, Graves writes. “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; in the first instance, an animated adult series produced by Steinberg.
“Ultimately, the plan is that filmmakers would pitch to the DAO using the same package and talent that they would any traditional studio or streaming business.”
READ MORE: How DAOs, NFTs and DeFi are Disrupting Hollywood (Decrypt)
Ahmed Shabana, a founder of Parkpine Capital, tells Fast Company: “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 loves cryptocurrency, NFTs, and the blockchain (Fast Company)
According to JP Morgan, the entertainment industry stands to benefit from the implementation of blockchain-powered processes, like content micropayments, the elimination of content aggregation, more reliable and accurate royalty distributions, and support for consumer-to-consumer sales.
Experiments are stacking up. AMC Entertainment says it will be accepting Ether, Bitcoin and Litecoin for ticket and concession purchases by the end of 2021.
READ MORE: Theater chain AMC to accept other cryptocurrencies along with bitcoin (Reuters)
Last year, indie movie Zero Contact was among the first to be auctioned as an NFT.
READ MORE: What NFT Means to the Content Model Could Be Profound (IBC365)
Marvel and Fox have released NFTs, including a limited edition set for Deadpool 2. MGM did the same for the release of No Time to Die.
READ MORE: Deadpool posters can now be bought as NFTs (Yahoo)
Cryptocurrency firms like CoinFlip, Robinhood and PayPal are tapping celebs like Tom Brady, Spike Lee and Neil Patrick Harris to drive mainstream adoption of the technology.
READ MORE: FTX, CoinBase and CoinFlip Spend Big on Hollywood Names to Gain Trust (The Hollywood Reporter)
The IOC minted NFTs for a mobile game themed around the Beijing Winter Games and to drive digital merch for the same event.
READ MORE: IOC launches Beijing Olympics-themed mobile game with NFTs (CNBC)
“It’s only a matter of time before blockchain technology becomes core to the way in which we interact with new media,” says Fountain at Rolling Stone. “However, there remains a need to increase access and funding to diverse entrepreneurs and startups all over the world that often get lost in the background.”
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One entertainer who isn’t likely to get lost in anyone’s background is Dolly Parton, who is partnering with Fox Entertainment’s Blockchain Creative Labs to launch Dollyverse, an audience-centric Web3 experience, at the South by Southwest Conference and Festivals on March 18.
According to William Earl at Variety, the Dollyverse will be the location for the release of an exclusive selection of official and certified Dolly NFT collectables, including limited-edition NFTs of the Run, Rose, Run music album and a limited series of Dolly-inspired NFT artwork, for purchase during and after SXSW. In-person attendees at Parton’s performance will be able to claim a free NFT, while fans streaming the event will be able to receive tokens authenticating their participation.
“Yet again Dolly is at the top of her craft,” Parton’s manager Danny Nozell tells Earl. “Her goal with new music has always been to use her gifts to connect with people. This partnership with BCL at SXSW, and the launch of Dollyverse, provide her a totally new way to do that.”
READ MORE: Dolly Parton to Livestream ‘Dollyverse’ SXSW Performance on Blockchain (Variety)
Like the launch of the commercial internet in the 1990s, Fountain believes we’re at a transitional point. In a decade, media and entertainment will have transformed completely.
“As entertainment companies begin rolling out new technology to distribute media and collectibles through blockchain, it’s imperative that leaders watch this space.”