How NFTs Are Changing the Entertainment Industry

  • NFTs have become a hot commodity in Hollywood.
  • Major entertainment players from Bob Iger to Reese Witherspoon to Warner Bros. Discovery are jumping in.
  • Some NFTs allow holders to participate in the Hollywood creative and production process.

NFTs are ready for their Hollywood close-up. 

The blockchain-based digital assets — NFT stands for non-fungible token — are a hot commodity in the entertainment industry, where everyone from former Disney CEO Bob Iger to Fox Entertainment to actors Reese Witherspoon and Mila Kunis are staking claim to the tech. On a recent episode of “The Tonight Show,” Paris Hilton and host Jimmy Fallon fawned over their respective Bored Apes NFTs

But a lot of people inside and outside of show business are still wrapping their minds around the tech, which has garnered skepticism, not to mention comparisons to the dot-com boom-and-bust.

In their most common current form, NFTs function much like digital trading cards or art — unique collectibles that can be acquired and sold. But there are many other applications for the tech, some of which Hollywood is just beginning to explore, including utility NFTs that act as a subscription or a ticket to an event. 

Read more about non-fungible tokens (NFTs), a unique digital asset built on blockchain technology

While some see the ascendance of the tech as a fad, others are loath to miss out on a potential new revenue stream, and the entertainment industry’s heaviest hitters are minting and buying NFTs of their own. 

Hollywood players from Disney ex-CEO Bob Iger to Reese Witherspoon are laying claim to NFTs

Witherspoon’s media company Hello Sunshine has inked NFT deals to develop TV and film projects, while “Law & Order” mega-producer Dick Wolf has teamed up with Curio to release interactive storytelling project “Wolf Society.” The Hollywood mogul who’s lent the most credibility to the digital asset is Iger, who invested in and joined the board of Genies, a company that makes digital wearable NFTs. 

Read more about Disney ex-CEO Bob Iger joining the board of NFT maker Genies, and check out 8 more companies working to drive the future of the digital assets in entertainment

Creators and companies are capitalizing on NFTs in various ways. Fox Entertainment released 10,000 “Miss Masky” NFTs tied to its hit reality show “The Masked Singer” in the hopes that fans of the singing competition will collect, buy, and trade other “Masked Singer” NFTs on the Eluvio platform (which Fox has invested in). 

Rupert Murdoch’s broadcaster Fox was one of the quicker legacy media companies to move into the space with its Blockchain Creative Labs NFT studio. The studio’s CEO, Scott Greenberg, who also heads Fox animation studio Bento Box, told Insider he believes NFTs will become a revenue-driving business for Hollywood and not just a market for speculative assets. Fox also has a $100 million creators’ fund for NFTs.

Read more about insiders’ predictions for how Hollywood can maximize NFTs in 2022, from character and IP development to subscription marketing

But just about every media conglomerate and startup is getting in on the action now. 

Warner Bros. sold out of 100,000 “Matrix Resurrections”-inspired NFTs, and NFT platform OneOf, backed by legendary producer Quincy Jones, auctioned off an NFT of the previously never-heard demo of a Whitney Houson song for almost $1 million. Paramount Global (fka ViacomCBS) — the parent company of MTV, Nickelodeon and CBS — is working with NFT startup RECUR to create its own NFT marketplace. 

Read more about ViacomCBS’ move into the NFT market with possible SpongeBob, Star Trek, and South Park digital tokens 

What the future of Hollywood’s NFT marketplace holds isn’t crystal clear, but early adopters are bullish. 

Early NFT adopters in entertainment see revenue opportunities ahead

Blockchain Creative Labs’ Greenberg sees the NFT market expanding beyond digital collectibles, while former Fox exec Rich Battista, a Curio investor and adviser, predicts that Hollywood will begin to create IP that is “native to the NFT world.”

Read more about the 5 biggest NFT trends to watch for in entertainment

Actor and producer Kunis, for instance, has invested in NFT animated series “The Gimmicks” through her blockchain entertainment company, Sixth Wall. The studio behind the series, Toonstar, is able to quickly animate weekly episodes that allow “Gimmicks” NFT holders to vote on the direction of the show’s storyline. 

Check out the pitch deck that got Mila Kunis to invest in an NFT animated series and blockchain fan community where NFT holders can vote on storylines

And there are entire entertainment companies being erected on a crypto and Web3 foundation, such as Mad Realities, which has raised $6 million in a round led by Paradigm that also includes investments from Bumble’s Selby Drummond, Rex Woodbury of Index Ventures, cofounders of the Friends With Benefits DAO, and 11:11 Media — Paris Hilton’s media company. 

Read more about Mad Realities, an NFT-meets-reality-TV entertainment company 

The allure of allowing industry outsiders to participate in Hollywood’s creative process is one factor driving this new business model. 

For instance, former co-CEO of MGM and Spyglass Entertainment co-founder Roger Birnbaum partnered with AOL scion Mark Kimsey to debut a studio that also allows NFT holders “a deep level of access to various stages of film and television production — from the creative process to development, writing, casting, marketing and distribution,” according to their new company Electromagnetic Productions. 

Read more about former MGM chief Roger Birnbaum and AOL scion Mark Kimsey launching a new Hollywood studio that offers NFT holders a role in production

‘Even the most traditional Hollywood company is not going to ignore the massive winds of change’

Expect more players to jump into the NFT pool in the coming months and years. 

“Even the most traditional Hollywood company is not going to ignore the massive winds of change that are going to start blowing through,” former UTA chief innovation officer Brent Weinstein told Insider. Weinstein, who’s now chief development officer at Candle Media — founded by former Disney execs Kevin Mayer and Tom Staggs — is positioned to capitalize on that intersection of legacy media and new modes of storytelling and distribution. 

“Do I expect the most traditional companies to be leading in this space?” said Weinstein. “Probably not, but I think the smartest of them will take advantage.”

Read more about former UTA digital exec and current Candle Media exec Brent Weinstein’s thoughts on Hollywood’s move into the metaverse

Christin Hakim

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