Web3 Could Change the Business Model of Creative Work
For most of the Industrial Age, technology acted as a tailwind for makers, powering an era of mass culture that supported a professional class of working artists. However, recently the rise of digital technology – especially the internet and AI – has become a source of economic disruption.
Web1, the so-called “reading web,” was a digital printing press that democratized access to information, but it also commoditized art and music and undermined the rights of creators as their intellectual property was laundered in the Internet’s whirling washing machine of content.
Web2, the “read-write Web,” made it easier to publish content, share ideas, and access broader audiences (i.e., “write” on the Web), but it also limited creators to tightly managed platforms that they did not trust or control and where they had no transparency about the economic impact of their work. Or you risk the wilds of the internet, where their creations can be copied without any recourse. Digital artists had no easy way to make money from their creations and could not profit when works were resold.
The platforms that control content distribution have grown richer and more powerful, with very little of that windfall trickling down to creators. Consider the strikes of the Writers Guild of America (WGA) and the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA). Streaming has already shortened television seasons, shrunk writers’ rooms, and eroded artists’ traditional residual income; and generative AI and 3D modeling give companies more tools to further minimize their use of writers and actors.
Web3 – the read-write-own web – on the other hand, offers new tools to earn and own assets, build wealth and regain control from powerful platforms and intermediaries. Web3 could simplify the way creators fund their ventures by crowdsourcing new titles directly from their fans. It could offer new ways to make a living, not just from the first sale of a work of art, but also from the first sale eternity thanks to programmatic royalty streams paid through smart contracts, self-executing code that can move and store money. In other words, it could offer a new model for creative work.
AI: risk or opportunity?
Now new technologies – namely generative AI – pose new challenges for composers, screenwriters, visual artists and other creative workers. It’s too early to say whether AI will be bad for all of them; it can expand the ranks of professional artists or grow the market for culture, creating opportunities for humans to co-create or collaborate with AI on an equal footing. But it could also greatly devalue the work of copywriters, composers and artists, relegating these workers to supporting roles, such as polishing scripts or adding some depth to digitally rendered art. Cezanne said, “A work of art that did not begin with emotion is not art,” but many studio executives did Think of AI as a way to save costs.
By analyzing hundreds of thousands of scripts over time against their viewing patterns, AI will become better at recreating screenwriters’ stickiest and most binge-worthy styles, characters, and plots, not just expanding on the arcs of existing stories to expand, but also to synthesize entirely new stories. series and recommend the optimal cast or mix of character types. Ditto about the virtual replication of actors, with tools such as FaceSwap are already being used to stars like Harrison Ford for his latest portrayal of Indiana Jones. But such big names are likely to agree to such innovations on their own terms. If Vox put it“If people don’t lock down control of their digital twins, nothing else matters.”
Oscar-winning director Stephen Soderbergh told the Hollywood reporter that, more than AI or visual effects, what keeps him awake at night is the opacity of streaming data: he speculates that the studios are doing very well and don’t want to share the wealth, or else very poorly and don’t want to share their supplies to refuel.
Artists hoped the internet would help disintermediate gatekeepers and middlemen and change the power dynamics in the creative industries, but instead it added new intermediaries, such as streamers and platforms, that distanced artists from their fans and obscured their economic impact. We need something else.
Culture needs a new business model
As technology turns the creative industries’ long-standing business model on its head, it also presents opportunities to establish a new model that can work better for creative workers.
Web3 technologies can simplify the way creators track and monetize the use of their IP, so they get paid quickly and fairly for their work. Web3 technologies, for example, can enable artists to grow and perhaps even prosper alongside AI, rather than suffer from its costs. For example, smart contracts could create opportunities for artists to be compensated when their work is used to train AI as a large language model.
Web3 adds one economic layer and a rights low to the Internet stack, where users can not only track the provenance of information and intellectual property, but also protect, manage and monetize these digital assets themselves with peer-to-peer transparency. These innovations can also change the way creative ventures are funded, removing industry gatekeepers and amplifying underrepresented voices. In the Philippines, independent game studios are selling NFTs of in-game assets directly to gamers to finance new titles, disintermediating major studios and traditional financial backers.
For Jules Urbach, CEO of cloud graphics company OTOY, Web3 is suitable for this purpose. OTOY’s flagship product, OctaneRender, is what’s known as an “unbiased, spatially correct graphics processing unit (GPU) render engine,” which is how the industry describes powerful software that can render more lifelike images and video than before. Marvel Studios used OctaneRender at the opening of Ant-Man and the Waspsaid Urbach.
Using the cloud, OTOY can deploy dozens – and sometimes hundreds – of GPUs simultaneously across its network to break down projects into smaller parts.
By splitting tasks, OTOY helps democratize the compute-intensive process of rendering, allowing artists to render in minutes what used to take hours on expensive hardware setups. Most importantly, everything created in the render network creates a hash on a blockchain, providing the verifiable provenance essential for managing artists’ IP rights and moving digital goods from platform to platform. With such capabilities, artist guilds could create a set of smart contract templates that their members could use in managing such lifelike representations of themselves – their digital twins – and collect privatized industry usage data that would give them bargaining power in future negotiations. The contracts may represent the negotiated terms of the artist guilds, plus whatever the individual artists or their agents have negotiated.
From Hollywood to everywhere
This technology also offers artists ways to invert the traditional top-down model, where studios and streamers try to control everything from IP to distribution. Hollywood screenwriter Jessie Nickson-Lopez has brought to life some of the most indelible characters on modern TV. As a founding member of the writing team of Stranger things, she developed the storyline for the character Eleven. Most recently as co-founder of Launch Web3 MV3she launched a collection of 6,500 non-fungible tokens (NFTs) of various characters, the building blocks for what will become a richly rendered narrative ‘universe’ originally created by Nickson-Lopez and her team. Set in the ‘dystopian cyberpunk society’ of 2081, after the ‘climate has gone to hell’, MV3 focuses on ‘a band of idealistic’ rebels struggling to ‘take control of the company running the city’ possess’. NFT owners will participate in the IP, have a say in their character’s arc, and even co-create the story with the MV3 team. These different character traits may eventually appear in film, TV, and other storytelling media. They can be playable characters in video games or avatars in the metaverse.
Knowing that fans will support a project is critical to fueling the Hollywood machine to spend a hundred million dollars or more on a movie or TV show. Nickson-Lopez said, “So we reverse engineered it and I created the world of Eluna City and the characters that live in it.” Although Nickson-Lopez designed this world and created storylines for the main characters, MV3 will not determine the direction of the story. “For me, the most exciting thing is to see how much creativity we inspire in people who have never created before, but are consumers of dystopian worlds and of fiction. There is a hunger to play. Our fans are our community and our co-creators. Because they are invested in the world and the characters, they are very excited to build it with us.”
MV3 inverts the Hollywood model. “As my lawyers say, ‘It’s like taking bits of value and just giving it to people.’ And we say, ‘Exactly! That’s exactly what we do.’” Recently, the founders handed over day-to-day control of the MV3 universe to the community.
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Ultimately, projects like OctaneRender and MV3 will work because they engage their communities not only in the economic benefits, but also in governance. Turning control and economics over to fans is against the Hollywood model, and Nickson-Lopez recognizes that. Involving people in the creative process, for the love of the experience and not just for money, is what clearly drives these creators and gives their projects purpose and meaning.
Technology resources and human capital are more distributed than ever. While Web1 and Web2 have democratized access to information and made it easier to collaborate online, Web3 provides creators with a new toolkit to build real wealth from their work, on a global level playing field. As the saying goes: the future cannot be predicted; it can be achieved. Web3 can help us with cultural industries and much more.