Bridging the Creator Economy With The Entertainment Industry

TLDR, special math edition:

Creator Economy ≠ Entertainment Industry

But…

Creator Economy x Web3 = Entertainment Industry x Web3

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The Creator Economy was supposed to catalyze a renaissance while bringing a greater measure of financial equity to makers. And to a degree, it’s happened.?

People now seem to make creatively fulfilling, “better” livings on YouTube, TikTok, Twitch, and such. No doubt, Creators have pushed the culture forward with new creative strategies and tactics. Indeed, the way we communicate on a day-to-day basis has changed to reflect their stylings.

But the long-tail promise of the Creator Economy has not matriculated to the arenas of “Premium Entertainment.” Movies. TV. Music. Games. And even those book-things.?

It’s a truth you can feel behind your eyes as you endlessly browse options on Netflix, Hulu, Amazon and HBO Max. Lots of B-minuses. Everything’s the same.

The insight isn’t mine. Credit Matt Klein, Head of Global Foresight at Reddit and author of the always-thought-provoking Zine newsletter. (Smash that subscribe button!)?

Klein unpacks the schism in “The Creator Paradox: Cultural Stasis Amidst Creative Surplus:”?

“On one hand, we have a booming Creator Economy, with an ever-expanding democratization of tools for production to anyone with an idea. So much so, that according to 1,000 surveyed Americans by Zine, 86% of people believe there is an overwhelming amount of entertainment available today.

Yet meanwhile on the other hand, we seem to have also found ourselves culturally stunted. Our box office and streaming platforms are soggy with the same regurgitated franchises. Reboots rule the roost, and familiar faces hog our charts, while notable newcomers redefining genres feel few and far between. With this, 64% of people declare they are getting fed up with today’s reboots, sequels and remakes.

What gives? How is it that during a moment of radical creator liberation and audience frustration, we’re finding ourselves with the same tropes and hooks?

Chris Anderson’s 2006 optimistic Long Tail vision promised us that ‘specificity’ — the shallow and obscure — would be economically feasible as the internet would connect the niche to its audience. Aggregators will win, the odd would thrive, and those on the edges would celebrate. Creators could finally connect to their 1,000 true fans.

But as seen from the macro view, a diverse, bottom-up media ecosystem is in fact not thriving. Instead, the inverse is happening. Homogeneity is winning.

Today, from film and TV, to books, video games, and music, there’s statistically less diversification rising to the top.”?

(The poignant support Klien cites is recapped in this slideshow.)

Bummer, right? Of course, it doesn't have to play out this way.

We can have a long(er) tail with high finish. We can have nice things that are also unique and interesting.

There are two related pieces to the puzzle: economics and discovery.?

First the money piece. The Entertainment Industry recycles for a reason, as it’s more statistically sound to base projections off past performance than it is off comps or from a blank slate. There’s less risk.

So how do you mine the long tail of the Creator Economy for gold in a way that both scales and delivers more reasonable risk management for financiers??

Well duh, costs need to come down.?

Key stakeholders have to take less guaranteed money upfront. And then, obviously, they need to have a bigger, more achievable piece of the upside. Sounds simple, right??

But it’s not simple, because accounting is tricky – particularly so in entertainment.

But then again, it actually is simple. Today, as in now and going forward, Web3 offers?transparent, irrefutable ledgers for any endeavor. That means revenue can’t be hidden. That means expenses can all be vetted. That means everyone can know where everyone stands from a financial perspective.

With Web3, Creators don’t have to demand as much money upfront. Instead, they can bet on their vision and talent and team with the confidence that by doing so everyone can potentially win bigger down the road. Consequently, betting on a proper production of something new or different or niche or just plain funky becomes a more potentially lucrative proposition.

Appealing to the money people is the first and most challenging part of the equation, but appealing to audiences is a close second.?

The paradox of (what is optically) choice makes discovery more of a chore than ever. Within the beyond-cluttered, beyond-cacophonous entertainment marketplace, there are four main engines of discovery: algos, marketing, critics, and peers.

Algos focus on the intersection of past consumption and peer behavior. More or less, they bring you more of what is consumed most and less of what is least chosen.?

Algos don’t take chances. Algos don’t invest in your growth. Algos don’t know what you’re doing on all of your streaming services. Algos only show what their platforms have to offer. And so, increasingly, Algos are not trusted.

Marketing is not trusted either. Plus, there’s too much of it. Plus, it’s expensive (see: risk mitigation, above).

For a number of reasons – oversupply, lack of time, cultural elitism & biases, reading is hard, etc. – critics today can’t drive discovery as effectively as they once did.?

Which leaves us with peers, which is what has always moved the dial in this and every category.?

Real word-of-mouth has never been scaled effectively. Sure, there’s a “UGC content engine” here and a “community platform” there that claim to be able to tap opinion at scale, but none of them really work.?

That’s because they’re exploitative, and people aren’t stupid. These tools scrape and cajole. They seek to extract as much value as possible and give as little as necessary in return. They’re transactional. They don’t create relationships.

Web3 creates relationships. Better yet, in this case, it creates partnerships.?

With blockchain spreadsheets and smart contracts, Web3 gives Creators and Industrians a framework for actually partnering with audiences; in doing so, it provides a path to low-maintenance, self-motivated promotion of any given movie, show, album, game, or book-thing. For real. It can all happen with the flick of a switch.

Bringing the Creator Economy together with the Entertainment Industry has been difficult. Of course, the usual resistance to change, erroneous assumptions and entrenched power haven’t helped, but the real problem is getting over what’s now a false contradiction.

Ultimately, what we’re trying to achieve here is broad, diverse, usable, economically-sustainable choice between high-quality entertainment. It reads utopian, or minimally like having your cake and eating it too, but it’s a viable option.

Web3 can integrate the long tail with premium production and execution; it’s the bridge that the Creator Economy and the Entertainment Industry need to realize their potential.?