NFTs are not only shaping the future of traditional media and marketing but also of the entertainment industry. The digital marketing guru, Gary Vaynerchuck, explains it best: “Imagine if Nirvana in 1992 had social media, and had advertised their album on TikTok, and all their followers on TikTok could’ve bought an NFT that represented a percentage of the backend in perpetuity. Now fans can make their wealth from their favorite brands making it. Every ticket from concerts and sporting events will become an NFT within a decade. You could use NFTs for everything. I’d argue that if NFTs were mature in 1975, George Lucas would be the richest person on Earth because every single collectible in digital form would give George Lucas a percentage not only of the primary but of the secondary transaction.”
NFTs are becoming the new way of engaging audiences to create a massive fanbase before the release of a movie, a TV series, or a song, thus generating revenue from the early stages of development and beyond.
Here are some exciting events worth sharing for everybody interested in the NFT space, for people in media, and the entertainment industry.
1- Fantasy Hollywood and Crypto
Most successful characters exist as intellectual property owned by a single corporation
- This means fans don’t have any governance, let alone direct ownership of these characters, limiting them to being only passive consumers of the products and narratives that the corporation decides to create.
- Crypto technologies like decentralized autonomous organizations (DAO) and non-fungible tokens (NFTs) enable a new model of character development and ownership that could unbundle creative media and lower the barrier to entry for online communities to bring new characters into the world.
Opening the Closed Loop of ‘Character Governance’
- There’s already a broader cultural shift happening in corporations and beyond.
- Stakeholders or communities seeking new ways to organize and invest both time and money into supporting people and causes that appeal to them.
- We are on the cusp of the same thing happening with intellectual property around cultural characters.
- Fans could introduce a new character into the real world, with anyone having the opportunity to participate in the fun, and financial upside of its success.
DAOs and the Economic Incentive of Tokens
- DAO networks are networks that are run by smart contracts, or self-executing code on a blockchain that can make commitments for certain rights and responsibilities if you’re a member of that decentralized organization – with minimal or no active supervision by a central figure.
- Anyone in the world with a mobile phone and an internet connection can become a participant in such a network, and the network may issue tokens to participants according to their contributions (or based on any other factors that the creators of the protocol decide).
Building communities around characters
- There are at least two paths by which communities can form around characters:
- Collectors have begun to collaborate with each other to create stories inspired by the CryptoPunk character art and bring their punks “to life.”
- The success of these stories drives more awareness and demand for the underlying punks, benefitting the PUNKS Comic creators, original developers, and the broader punks community.
Aku: a young, Black astronaut character created by Micah Johnson
- Hundreds of millions of internet users could determine the value of an artwork, and also easily own a token representing it.
- Collectors could use this token to represent their membership in this community, and establish a digital cultural identity.
The Business Case for Community-Owned Character IP
- NFTs serve as a powerful tool for an artist to test market demand for early representations of their characters.
- Provides a stronger signal to the artist and to other collectors that there is “skin in the character.”
- The challenge then becomes how to grow that community, evolve the character, and distribute it to a broad audience across mainstream media platforms.
The rise of character DAO
- Benefits of DAO include: Faster creative iteration, value capture and revenue growth, and better cultural representation-
- Aligned incentives among DAO members-
- Streamlined collaboration-
- A community member drafts a brief for a short film or animated series, and sends it to the DAO to approve and allocate an initial budget for it-
- Production companies respond with their vision of how they would bring the brief to life-
- The founding artist functions as creative director working for the token holders-
- Each successful media activation would convert a new audience into community members who also want to get involved-
The Governance Questions
- What types of decisions should DAO be optimized around?
- Who will manage day-to-day administrative and community management functions?
- How will DAO maintain quality control around the IP?
- The sale of NFTs enables an easy way to fund an on-chain treasury that can be managed by token holders.
2- Legacy Media and the Future of NFTs
Since September, TIME has created, or “dropped” as it’s known in the space, more than 20,000 TIMEPieces NFTs that are owned by roughly 12,000 digital wallets, approximately half of which are connected to Time.com. That’s translated into $10 million in profit for TIME, as well as $600,000 generated for various charities.
TIME recently partnered with ethereum-based gaming platform The Sandbox to create a virtual space in the metaverse dubbed TIME Square, which will serve as a central location for the brand to host virtual art and commerce events.
With its $1.5 billion market cap, according to CoinGecko, The Sandbox is among the largest metaverse projects, due in large part to its early adoption of blockchain technology. In November, a virtual plot in The Sandbox set the record for the highest-valued digital land sale when metaverse developer Republic Realm paid $4.3 million to purchase a digital parcel from Atari.
3- How Dubai is investing in NFTs
The crown prince of Dubai has his eyes set on the digital world. This week, Crown Prince Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum announced a new “metaverse strategy” that he says will create 40,000 virtual jobs and add $4 billion to the city’s GDP in five years.
Attracting crypto and early metaverse experiments
- Dubai passed its first law dealing with virtual assets and established the Virtual Assets Regulatory Authority for crypto companies.
- Lured by a crypto-friendly government, the crypto exchange Bybit said it would open its global headquarters in Dubai.
- Some of Dubai’s biggest companies have said they are increasingly incorporating the technology into their businesses
High ambitions for the economy
- The UAE wants to double the size of its economy in the next 10 years.
- Crypto and tokenization will be key to achieving that goal.
- In the area of augmented reality and virtual reality, the UAE currently hosts a total of 6,700 jobs which contribute $500 million to the UAE’s economy.
Valerie was born in Bogotá, Colombia. At a young age, she discovered her passion for writing fairy tales. While studying photography, Valerie decided to transform her stories into visual content, and earned degrees in Filmmaking, Cinematography, and Screenwriting in New York and Los Angeles. Since then, she has produced, written, and directed several award-winning films that have participated in film festivals around the globe. She is researching and writing about TikTok trends and the NFT space.