Back in the early 1980’s Home Video was considered the Filmmakers New Golden Goose. That was 40 years ago. We have witnessed the digital revolution since then. This has impacted everything from filmmaking processes to film distribution.
Filmmakers I meet have rarely heard of NFTs. Let me explain what they are, how this will impact filmmaking, and how to make and monetise them. I personally believe that NFTs will become the filmmaker’s new golden goose.
What is a Non-Fungible Token (NFT)
A NFT is a totally unique digital file which is registered on a blockchain ledger in the same was as cryptocurrency. Unlike cryptocurrency, like Bitcoin, a NFT is totally unique. The blockchain ledger verifies who is the rightful owner of this one-of-a-kind digital file.
How does this work for creatives?
Artists, writers, photographers, musicians and indeed, filmmakers, create digital files.
These digital artworks are marketable as a unique collectible when turned into an NFT. When an NFT is created, registered and then sold, a record is kept on a blockchain ledger. This ledger shows a record of both ownership and authenticity.
In days of old, if you bought a painting from Picasso, he would get a cheque and you would get the painting – a fungible token. If you then resold the painting, you would get all of the profit, and Picasso would get nothing.
Not so with an NFT. You can design the NFT so whenever the NFT is resold you, the content creator, would receive a portion of the resale price, usually 10%.
What is the NFT noise all about?
Certain artists and musicians have made sizeable fortunes by selling NFT versions of their digital art and music. Wealthy collectors have been lining up to get a piece of the action. You may have heard of the digital artist Peebles who sold a digital artwork for $69.3 million in auction in February, 2021.
But it’s not just artwork or music that can be sold as an NFT. Jack Dorsey, the founder of Twitter sold his very first tweet as an NFT for $2.9 million. Pretty much any digital collectible can be turned into an NFT – from online trading cards, GIFs and sports memorabilia to video-game wearables and virtual land in fantasy worlds.
When I first found out about this, I was scratching my head in disbelief. Investors are spending millions of dollars on digital art that only exists in the ether.
The filmmakers new Golden Goose?
Artists, influencers and musicians have begun making a fortune by vending NFT versions of digital art.
Filmmakers create digital files which can be turned into an NFT. This NFT can be sold. The owner can then choose to keep it, or to exploit it financially. In theory, if you made a film, turned it into an NFT – the new owner could then put it onto a platform like Netflix and monetise it.
Digital artwork, be it images, sound and music or movies are marketable as a unique collectible when turned into an NFT. Cryptocurrencies like Ethereum are generally required to enter an NFT transaction, and its public ledger shows a record of both ownership and authenticity. And investors are lining up to get a piece of the action.
How filmmakers are using this new Golden Goose
In theory, you can create a film and turn it into an NFT. You could either sell it to one collector, or investor. Or, you could do what Wu-tang Clan did in March. They sold 36 digital copies of a 400 pound book containing rare pictures of the band.
Other filmmakers are currently designing feature length projects where slices of the movie can be sold to individuals, who could then claim bragging rights over owning the original digital copy of the film.
NFTs should be attractive to anyone contemplating a short. Perhaps you can give an NFT of the entire film to an investor who will fund the film.
Marketing a film as an NFT relies on marketing. In this sense, the challenge of marketing a film as a film is no different than marketing an NFT. For an NFT you need to have something unique, like a well known actor. Another route would be to work with a world class musician.
Of course, with any new technology, the real future of filmmakers and NFTs will be up to you. Can you innovate and use your entrepreneurial flair?
The NFT marketplace
I always advise filmmakers to attend a film market to see how films are bought and sold. Why not while away a few hours looking at the digital marketplaces where NFTs are sold?
Popular digital marketplaces are OpenSea, Rarible and Mintable. If you want NBA Top Shot sells pro basketball “moments” and Valuables offers tweets for sale. You will note that prices are listed by Ethereum.
Can you make an NFT?
You better be good at digital geek. There are a lot of steps you need to take. Basically you need to be connected to the internet. You also need to understand the basics of going from a cryptocurrency exchange, to acquiring a digital wallet, to entering a digital marketplace. CoinDesk put out this handy guide if you want more details.
Many of the first NFTs were in the style of CryptoPunks, pipe-smoking digital beings that date back to 2017, and CryptoKitties, cute virtual felines that started the same year. And I bet you’ve seen these and not really realised that they were NFTs.
So is this a fad? Or Not?
I, for one would never pay a grand for a virtual Christmas sweater with a Bitcoin logo on it. So does this make NFT a fad?
It’s reported that the 2020 market in NFTs was about a quarter billion dollars in 2020. February 2021 saw sales of over $220 million with the average price of one NFT being about $100.