Why NFTs Could Be the Next Big Thing for the Content Industry
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NFTs have taken the business world by storm. Whether it is tech, music, real estate, gaming, or sports, the introduction of NFTs within these industries have resulted in groundbreaking milestones.
As a result, several investors from other industries are showing a growing interest in NFTs. They believe that in the near future, various properties ranging from tickets to houses will have ownership status tokenized. This makes sense if we consider the fact that images, videos, music, tweets, gaming characters, and even text can be turned into NFTs.
Recently, Wong Kar Wai, an auteur from Hong Kong, has launched an NFT auction through Sotheby’s that managed to raise around $550,000. It also includes unseen footage from In The Mood For Love. This is an indicator of a bright future for the content industry.
However, the question remains, what is this specific NFT revolution all about? What does it have to do with the content industry and does it hold the potential to act as a gamechanger for the content industry?
What are NFTs?
NFTs, short for Non Fungible Tokens, are digital assets that have garnered significant importance in 2021. They exist on blockchain and serve as a public ledger, thereby giving people the power to verify the assets’ authenticity and ownership. Each NFT holds a specific and unique digital signature that makes them one of a kind. They can be easily bought using the cryptocurrency Ether or purchased using dollars. The blockchain maintains a record for all the transactions.
When it comes to NFTs, any digital object can be converted into an NFT. Whether it is digital art, video highlights of moments from the game, patches of land in the virtual world, or content, all can be converted into an NFT. If we look into DappRadar’s industry report, we observe that the NFT trading volume was set to surpass $23 billion in 2021.
Involvement of Content Industry
The media and content industry has displayed a growing interest in NFTs. Major companies like Disney, Lionsgate, and Warner Bros are doing their best to take this revolution to the next level.
Additionally, many NFT powered companies have been launched in 2021. Some of the popular ones include Fox Entertainment, Blockchain Creative Labs, NFT Studios from Martin Scorsese’s, Decentralized Pictures from tech veteran Leo Matchett, Roman Coppola, and American Zoetrope executive Michael Musante.
Many Asian companies in Hong Kong like CryptoBLK, Marvion, and Coinllectibles are integrating the world of film and television with technology such as NFT’s. Bizhan Tong, the founder of Phoenix Waters Productions, said that his interest in the NFT rose during his research for Lockdown, a pandemic thriller.
Julian So, co-founder of Mrvion and Coinllectibles, explained that the company’s “hybrid” or “fusion” NFTs is a combination of intangible assets in the virtual world that are backed up by a license or copyright agreement in the real world.
Furthermore, Julian went on to explain that, “everyone talks about how NFTs are smart contracts, but the reality is different. There is nothing legally binding in a smart contract.” All it carries is settlement facilitation; Julian stated that their fusion NFTs contain documentation minted on the blockchain and it specifies different rights that each person holds.
Apart from this, Phoenix Waters announced a partnership with Duncan Wong’s CryptoBLK on a drama series titled Crypto Keepers. They will be offering NFTs that will provide opportunities to their owners to vote on the storyline of the second season. Wong added that the next step would be to offer NFTs with certain IP rights; it could be by producing a short clip or hosting a particular character on social media or the metaverse.
This activity will create an extra revenue stream; however, complications arise when it comes to investment or the blockchain equivalent of equity crowdfunding. Wong explicitly mentioned that the issued tokens must fall into the category of the NFTs or utility tokens. If they were to ever appear to be a piece of equity or a security token, it would draw the attention of the security regulatory bodies.
Fans of the show can easily buy NFTs and use them for voting purposes. They also have the ability to sell them down the line. Additionally, there will be more incentives for fans to make the show successful. This would increase the value of NFTs. Wong added that Netflix would potentially come up with a metaverse live show for major talent and sell tickets as NFTs.
Although the concept of NFTs within the content industry sounds exciting and promising, there are many hindrances that are preventing this technology from becoming mainstream. One such barrier is the trade of NFTs with cryptocurrency on specialist exchanges. There are also some regulatory issues where the government could intervene.
However, 2021 has given us a new light of hope. Blockchain has provided tremendous results in business, especially with regards to sales, reports, and reducing production costs. In addition, the same silver lining has been displayed in the content industry. Needless to say, since the future is looking bright, why not be a part of this great revolution?