How NFTs Are Influencing Hollywood And The Entertainment Industry
For the past few years, the growth of the Hollywood industry has been hindered by a lot of problems. Some of these problems were exacerbated by the Covid 19 crisis when production was stalled, distribution cycles were disrupted and theatres responded by postponing releases. In all these problems, there is a greater problem which has threatened the growth and status quo that this industry has built all these years. This problem is “technology”.
Of recent, Blockchain technology is making positive changes in many industries and NFTs are one application of logy that have some big positive effects on the entertainment industry like Hollywood.
Let’s take a look at how non-fungible tokens(NFTs) have carved a niche in the entertainment industry. Before that, we need to understand what NFTs mean.
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What Are NFTs
NFTs is an acronym for non-fungible tokens. NFTs are unique digital assets that exist on a blockchain, which is a digital database that underpins cryptocurrencies like Bitcoin and Ethereum and serves as a public ledger that allows anyone to verify the non-fungible token’s legitimacy and who owns it.
These assets are unique and non-interchangeable with something else. In other words, no two NFTs are the same and they can’t be swapped for an identical one of the same value.
A large number of NFTs in existence today are built on the Ethereum blockchain and the blockchain on which these NFTs are built creates room for the scarcity, uniqueness and security of NFTs. The system’s pattern of recording and tracking information and transaction poses great difficulty to hackers who steal and replicate NFTs.
There are many types of NFTs, including music, videos, photos, tweets, and digital art. NFTs, give the average man an opportunity to become a creator and make millions.
Similarly, art collectors can start NFTs collections by buying NFTs through any NFT marketplaces like Opensea or Rarible with ETH(Ethereum tokens), because they are based on the Ethereum blockchain.
One can also purchase NFTs with credit and debit cards from other marketplaces like Crypto.com.
Given the high security and unique characteristics of NFTs, integrating NFTs into the entertainment industry could be a major way to reduce fraud and increase transparency.
Benefits Of NFTs In Entertainment
Both buyers and sellers of NFTs have a pool of benefits to reap from a completed successful NFTs transaction.
NFTs creators in the entertainment industry have been able to utilize this technology to a great extent, making more profits for the firms, and enhancing a long-lasting cordial relationship with fans.
Let’s take a look at a good example of how the famous Hollywood movie producing company, Warner Bros did use NFTs to extend the life of their franchise IP.
Warner Bros offered 100,000 NFTs representing characters living in the fictional Matrix universe ahead of the December 2021 release of The Matrix: Resurrections, a continuation of the 1999 film. Each NFT sold for $50 and generated $5 million for the programme.
The psychology behind this was to create more awareness around the movie and maximize an existing successful franchise’s IP. This gave fans the opportunity to engage in a very unique way.
Entertainment companies see NFTs as a special way to engage with fans and fans, in turn, engage more with the character, properties and stories they love.
NFTs offer fans new ways to engage with and support their beloved franchise financially.
The value of NFTs to fans is solely embedded in its general scarcity because they are not generally distributed.
Owning NFTs come with some unique rights to usage (though the creator often retains control over copyrights).
NFTs can be said to be a long-term investment as they tend to appreciate over time.
How The Entertainment Industry Leverages NFTs
You may think Warner Bros is the only industry leveraging NFTs to their advantage, as discussed above, but many industries are finding unique ways to use these digital assets to extend IP, create monetary value, engage with fans and enable consumer ownership.
These are a few ways and scenarios entertainment industries are leveraging NFTs to maximize franchise IP and engage fans;
1. NBA Top Shots;
This is basically for basketball fans. These collectibles of iconic scenarios in the court are operated like trading cards. Fans can highlight clips and more with a token called Flow, powered by the Dapper Labs blockchain.
The NBA Top Shot had generated more than a billion dollars in sales.
2. Stoner Cats:
Stoner Cats has the ambition to decentralise content production by directly connecting storytellers and the audience without the mediation of the big media.
Buying one of the collectible NFT cats will give you access to a series of fun animated shorts featuring the voices of Mila Kunis, Jane Fonda, Chris Rock etc.
10,000 NFTs available for sale at 0.35 ETH (over USD 800) sold out within 35 minutes, grossing the production a total of $8.5 million.
3. Pulp Fiction clips:
Director Quentin Tarantino once announced that he would be offering seven uncut scenes from his classic 1994 American crime film, Pulp Fiction as NFTs.
Even though fans were excited by this news, axe, the studio behind the creation of Pulp Fiction, quickly announced plans to sue Tarantino over the sale. It is safe to say that this legal battle marked the beginning of high-profile disputes over NFT property rights.
4. Zero Contact:
In 2021, an NFT film distribution platform Vuele hosted its first star-powered feature film NFT which was shot during the pandemic all over the world, using video conferencing software to avoid any health risk . With the advantage of star Anthony Hopkins featuring in the movie and the charm of scarcity, it became available to 11 buyers in September 2021 after another 2500 were released in October.
NFTs are gradually changing the entire system of the world, offering more opportunities, convenience and decentralized ways to create arts and entertainment, then earn continuously from them.
The Hollywood industry has experienced a tremendous change in sales and fan engagement through the creation of NFTs. As more and more entertainment is digitized as tokens, fans will more personalised and tend to engage more with their favourite series and characters.