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Blockchain technology originated to solve the existing problems in the finance industry - specifically, eliminating the middleman to provide a self-sustainable system that is independent of a single party. The past decade has shown that the potential applications go far beyond just moving money from one account to another.
Decentralized finance, real-world asset tokenization, supply chain management - these use cases are usually the first ones you find when you try to understand blockchain potential applications. In this article, we will touch on the aspects of a very specific industry - entertainment, which is often combined with media.
Although the concept of NFT (non-fungible token) had already existed since the mid-2010s. The first experiments were actually launched on the Bitcoin network. We saw the rise of projects in the 2019-2020s. Although right now, we definitely see a downtrend in the hype, we should not consider the technology completely dead.
If we take the Gartner curve as a model, we can clearly state that we have already passed the “Peak of inflated expectations” and probably the “Trough of Disillusionment”. So, why should we expect the market appreciation to go up, and what lessons have we learned from the past years?
The NFT concept showed us two very important properties of the assets: real ownership and interoperability.
Real ownership is something that could have never been experienced before in the digital world. Before, every type of asset that you could buy - a ticket, a song, a movie - was heavily dependent on the platform where you had bought it. Yes, the platform says that you “own” it - but if you dig deep into the terms and conditions - that are never read - you would see that the asset still belongs to the platform and the fact that you “own” it can be changed literally any time. On the contrary, NFT represents the fact of real ownership, as no one can move it away from your crypto wallet.
The second concept is universal interoperability. We should be thankful to the community for delivering the open standards of NFTs that can be used by anyone to work on their specific project. This inсredible feature led us to the world where NFT marketplaces have taken the niche of trading and auction platforms, taking the boring stuff away from projects so they can focus on delivering specific features and forget about the infrastructure.
If you start thinking - OK, so people are buying pictures of apes, frogs, and other things - but is there any real value in NFTs? Well, we can say that we already had “web0” NFTs a long time ago - the paper tickets! If you want to go to a sports match, music concert, movie, or a theater show - you buy a ticket, which represents the right to visit it. Usually, it has a number, date, and seat - so the event tickets are already unique, and therefore, non-fungible!
Web2 platforms made a small revolution here - you don’t need to visit the theater to buy a ticket; you can do everything online with just several clicks and a credit card. The authority that issues the ticket would be the one that would deliver you the experience, so it’s not the case where we need to “decentralize everything” - if a show is a scam, the NFT-style ownership would not change anything. So there is a simple question - if everything works, should we stop trying to use blockchain everywhere? Maybe there are no problems in the entertainment space that blockchain can solve?
The answer is pretty straightforward - the secondary market. Of course, lots of cases happening in normal life are working well - as your bank does work well until it gets closed. In many cases, the demand for tickets to a specific event - a music concert by a top artist or a Broadway premiere - is way bigger than the supply. And this is the time when you face your worst nightmare - you want to visit the show, but you need to deal with people who have previously bought tickets as an investment to resell them at a higher price. You don’t know the market price, you can’t prove the authenticity of tickets, and you don’t know if it is a scam - so basically, you’re gambling.
A normal person that has no web3 experience can say - we need to build platforms for secondary sales, or the organizers should build such platforms on their own; we need an independent proof-of-authenticity platform, we need price discovery mechanisms, maybe even auctions. But for a blockchain enthusiast, the answer is obvious - we have already built NFT marketplaces like Paras, the ticket is obviously an NFT by its nature, so why should we reinvent the wheel? Indeed, nowadays, more and more web3 conferences are selling tickets as NFTs, and we’ll see more and more event runners switching to blockchain technology as the adoption increases.
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To enrich the ticketing experience, we can also pay attention to loop payments associated with some kinds of events. As an event organizer, you can provide additional services that the visitors can benefit from. Right now, to simplify the system, you can have different tickets with different levels of access - from ordinary ones to VIP experiences. But the web3 nature tells you there is another simple way of providing the fan services - tokenize them. Every ticket holder can receive a certain amount of tokens that can be used to access certain parts of the events or get some additional bonuses. You can go further and add trading on 3rd party platforms, utilizing the unprecedented level of interoperability between crypto assets - this can become one of the first steps of introduction into web3.
Another interesting example of engagement with fans is fan tokens. There are some interesting projects, specifically in sports, that allow you to purchase a token that represents a certain team that opens you additional opportunities as a fan. Some teams can ask token holders to vote for certain decisions, some may provide additional benefits such as tickets on top matches, and some may even distribute some portion of the revenue or get you in touch with the sponsors directly! This is a new way of organization-to-fan direct interaction, and again - you don’t need to build the whole infrastructure; you can just use the existing web3 marketplaces and other services and integrate your experience in days!
The last on our list - but definitely not the last that we will see in the next few years - is the web3 way of engaging with fans of newborn stars. With a high level of confidence, we can say that many of us started following some artists during the very first steps of their careers. Imagine a situation where you could support the artist at this very hard and life-changing stage - by buying his NFT or a fan token. And no matter what this token represents - it could be just a collectible that can grow in price with the popularity growth, or it can even be the share of the future profits of a specific song - this does not only help the artist to succeed, but it also provides the token holder with an incentive to help the artist grow his audience. And again - it’s a small portion of the web3 magic that gives the communities the power without a middleman standing in between.
Thanks to the fiction authors of the past and technology builders of the present, we live in a time where we can entertain ourselves at home - Youtube, Facebook, and tons of other services are at our service. But there is still a small issue that we’ve touched a paragraph above - the ownership. Again, if you go to these boring terms of service, you will see that you actually own nothing - even your own photos! Yes, some platforms share the money they make on your content (but only a small portion of it), and others just provide you the service for free in exchange for your information. We can’t say that it’s not fair - as a non-tech person, you can barely imagine the amount of capital and operational expenses to run such platforms, but it seems there is a huge issue with the privacy and ownership of the content. To be completely honest - the decentralized Youtube sounds like a utopia, but at the same time, we see that almost every big corporation has started doing their own research on web3 mechanics. What can we do as a community? We can show the power of the ultimate ownership concept so the future products would be built in a more secure and privacy-preserving manner.
Another good example - streaming services that have become popular in the past years. You don’t need to pay for a specific show or song to listen to - you just pay the streaming service provider and get access to the content. You don’t buy it and just get a license to access and watch or listen - so where is the problem? Of course, you can be sure that top shows and top artists have contracts with the streaming services, so they will get their revenues in any case. But when it comes to a small indie rock band - they have their audience, but how can they be sure that they get the amount of money proportional to the share of users’ attention? Basically, for beginners, there is no other option than to trust the platforms - something that we’re trying to fix by introducing web3 mechanics. There is no way that a blockchain-based product can cheat on the number of transactions - everything is stored in the public ledger and can be audited by anyone, anytime. Hopefully, one day we will be able to use the same paradigm with other types of services.
Check out our article about opportunities in web3 gaming.
How can Calimero help you in building the projects in entertainment, and why should you care? A cornerstone of our mission is to bring mass adoption to web3 and blockchain in general. Now, if you think about any web3 project, there is a challenge that is barely solved - the user needs to pay for any interaction with the application, so he needs to own some crypto. This is a big stopper for the web3 revolution, and that’s why we don’t see the type of adoption that we saw previously with web2 platforms. In the era of freemium business models, why should a person pay for everything?
A Private Shard is an option that breaks this gate. Transactions inside the Shard are free, so the existing experience is not broken. The wallet works just as any other means of authentication like Google, Facebook, and others - just check out how NEAR is building user experience around their wallet. With the Private Shard, you can go even beyond - just start building your application in a web2 way, hide the complexity behind the scenes, and let users operate in a way that is comfortable for them. After everything is set up, you can use Calimero Bridge to build an additional layer on top of your application - let your users bridge their ticket NFTs to Paras (with Calimero, you can cover the costs of such actions) - so they will the see the big web3 universe that was just behind the corner - and that’s how everybody will win. If you want to implement Private Shards in your project, contact us and someone from our team will get back to you! Don’t wait to implement privacy features and scale your business - you can do it in a matter of minutes with Calimero.
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