The Synopsis
"The movie industry is... a business of the unusual," argues Arthur De Vany in his book "Hollywood Economics." It is controlled by a small number of outstanding films and performers who account for practically all of the industry's earnings and influence."
As a result, the majority of manufacturers end up with a portfolio full of duds. They spend millions of dollars on a film just to watch it fail at the box office. And this isn't a one-time occurrence. Instead, it's the standard.
Needless to say, film funding is a risky business. However, one film producer now wants to add to the excitement by crowdsourcing the financial portion. And he plans to achieve it via Non-Fungible Tokens, or NFTs.
Let's start by breaking this out. What does it mean to have a non-fungible token? Especially the phrase fungible in the middle.
Take a look at it this way. If you had a Rs 10 note, you may trade it for another Rs 10 note and the difference would be little. They may be used interchangeably and have the same value. It’s what economists call a fungible token. Non-fungible tokens, on the other hand, cannot be swapped in this fashion. They'll always be unique, and putting them on an immutable record like the blockchain turns them into non-fungible tokens (NFT). Meaning, until you choose to distribute it elsewhere, a token issued to you on an internet ledger (blockchain) maintained by a network of linked computers will always belong to you. The records can't be changed, and your token ownership is unquestionable – at least in principle.
While NFTs may be used to represent ownership of any item, they're most often used to symbolise ownership of digital goods such as art, music, or memes. The only problem however is that owning an NFT doesn’t automatically guarantee “complete” ownership. Consider the case of someone building an NFT based on a famous music video. You could buy that NFT and brag about it to your friends. However, you may not be entitled to any royalty fee the music may come to generate. That money will still go to the composer. And while artists can sometimes throw in this extra privilege if they so desire, it’s not something that happens all the time.
So there are also those who see NFTs as nothing more than glorified trading cards. It's entertaining while you're talking about it inside the ecosystem, but NFTs may be meaningless outside of it. The flip side however is that some NFTs have been selling for a lot of money. And by a lot, we really mean a lot. Consider, for instance, this cat meme.
The original digital rendition sold for $590,000 in an online auction. And some NFTs have even sold for millions. Clearly, there’s some potential here. But that aside let’s get back to the main story shall we?
Alright!
So recently, a long time Hollywood producer Niels Juul — best known for producing the mob drama “Irishman” decided to take the plunge and finance his movie using NFTs. Juul intends to solicit funds and produce a series of full-length feature films entirely through NFTs. The plan is to raise around $8 to $10 million by selling close to 10,000 NFTs to a mix of public and traditional industry investors. And he hopes to do it soon.
For people that buy the NFT — Well, they get to own the digital token representing some degree of ownership. But more importantly, Juul has also promised to share a slice of the profits these movies might make along the way. So on this occasion, it won’t just be about bragging rights. Instead, the NFTs could actually be a way to make big money.
Now nobody knows for sure if Juul will succeed in this endeavour. But if he does, this could open up a whole new avenue for producers to access capital. It could make crowdfunding easier and more importantly, popular. Perhaps this could change the face of movie financing altogether.
(Source: Finshots)
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