Can blockchain help a dying film industry?
by Vassilis Economou
- CANNES NEXT: As well as a presentation of the latest Nostradamus Report, NEXT hosted a panel on the importance of introducing blockchain in the film industry
The NEXT conference room hosted a special presentation of the Göteborg Film Festival’s annual Nostradamus Report, which this year has been published for the fifth consecutive year. Johanna Koljonen analysed the key points of the report, which focuses on the changes that the film industry will have to face in the coming three to five years. You can also read our overview of it here.
Summarising the highlights of the presentation, Koljonen underlined that we should now be more worried than optimistic regarding the future of the industry, as we are jumping into the unknown waters of new technologies. Cinema is as much at risk of becoming obsolete as any other, older form of mass public entertainment if it doesn’t diversify. In particular, the audience consisting of younger teenagers is now shifting away from traditional social media; they are early adopters of VR and are not willing to follow advertisements as suggestions for content, and these people will evolve into the future audience that the companies should focus on.
So, the main challenge is to find the relevance of film as a product and the final audience – especially the newly evolved one that is emerging from uncharted virtual territory. The main contradiction that we are witnessing now is that we are in a period when series and films that are better than ever are being produced, and the audience is more willing than ever to consume, but these two aspects cannot come together harmoniously as they are supposed to. Koljonen concluded that we may have only two years to evolve in order to prop up the film industry. Also, the answer to the cinema crisis is probably not VR, which will develop as an autonomous medium.
The conference followed up with a more general panel, where tech experts focused on the importance of the introduction of blockchain, especially in sales, distribution and funding. Bear in mind that the focus of NEXT this year is blockchain, and a special corner is being dedicated to six exhibitors from Europe and abroad (see the news). The panellists were asked to comment on the changes that blockchain will bring in the near future.
Erwin Schmidt, of Berlin-based Cinemathon and The FilmTech Office, started by talking about the evolution of blockchain, since there has been a great deal of discussion in the past and we have already passed through the theoretical R&D phase. He mentioned that 2017 was the actual year of experimentalising the technology, while this year, we are developing the business models and application of blockchain, but of course with no solid results as yet. Currently, the principles are being tested but not implemented, so no results can be presented yet in this very dynamic environment.
Maria Tanjala, co-founder of Big Couch and FilmChain in the UK, emphasised the effect of blockchain on the financial part of producing a film. By allowing the decentralisation of transactions, added to the sheer efficiency and transparency being offered, everyone in the business will have their fair share of the cash flow with an added layer of security, as blockchains are considered impossible to break. Furthermore, the ownership of rights won’t be disputed thanks to blockchain’s smart contracts, which will allow the cinematic ecosystem to run even more smoothly. Also, the data related to the performance of a film in distribution will be both protected and analysed, while all of the transactions will be able to be tracked and performed immediately, offering a more dynamic approach to production. It is extremely important to make a contract that cannot be disputed, and to allow value to be transferred completely freely.
Alan Milligan, of Norway’s White Rabbit AS, agreed on the importance of smart contracts, as they will eliminate all of the suspicions that may exist between different partners. Focusing on the implementation of blockchain through his company, which is closer to P2P distribution, he expressed his wish that this kind of transparent and encrypted transactions will allow the majority of the 240 million “pirates”, as they are currently considered, to actively support their favourite films or creators by actually paying for them. By offering these new transactional tools, it will be possible to recoup part of the $20 billion lost to piracy every year in the industry.
Finally, Dana O’Keefe (Cinetic Media) highlighted the important transformative potential that blockchain offers. At present, big corporations still control the data, although now – probably for the first time ever – we have the chance to give a voice to the fans and smaller businesses so that they can become active players.
Some of the discussion’s final remarks were that crowdfunding really does work, and through cryptocurrencies, blockchain can become an active tool for this. If these tools evolve and are made more widely available, they will be the active driving forces firstly in recuperating the value lost to piracy, and also in supporting independent productions more efficiently and actively. Another conclusion was that decentralisation will hopefully not allow the big studios to grab all of the content, as it will be impossible to control everything that is happening in parallel minor ecosystems, thus leading to less manipulation of what people consume and do. On the question of whether a European streaming platform based on blockchain can fight the major worldwide competitors, such as Netflix and Amazon, the panel was rather sceptical, but did not rule out this possibility within the next five years.
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