Web3 in Hollywood could pave the way for the popular IP address of the future

First there was Matt Damon’s badly timed adthen the crypto winter, then the crash of FTX.

Last year was not a good year for the crypto market. But the promise of blockchain technology was never about get-rich-quick schemes, and defrauding investors was never a result of blockchain technology. If there’s a silver lining to this latest implosion, it’s that we finally need to decouple these events from the potential Web3 technology has to transform Hollywood for creators, fan communities, and the industry’s development and production processes. Because nowhere are the opportunities for Web3 as necessary and possible as in the entertainment industry.

Web3 in Hollywood has the potential to bring more diverse creators to the table, create more projects, deepen audience engagement and retention, and lead us out of the era of prequels, sequels, and reboots. While fortunes did not favor those who followed Damon’s advice, Web3 did favor entertainment creators and fans.

This is why investments in Web3 projects in Hollywood continue to rise. Andreessen Horowitz recently opened an office in Santa Monica to oversee many of their Web3 investments. UTA recently partnered with Investcorp to increase their investment in Web3 startups, and Warner Brothers just launched an NFT account Twitterindicating a public commitment to the category.

But it takes more than dropping an NFT to succeed at Web3 in Hollywood. There are signposts from Web3 pioneers paving the way for success in the space, and everyone from small startups to large studios would be wise to consider these elements.

Authenticity: Messages and actions must match

Most importantly, don’t call a project “Web3” just because you drop an NFT. Web3’s promise is about creator and community ownership and community involvement. Success requires the support of the early Web3 community, and the incongruous nature of turning Web3 projects into cash grabs will be immediately noticed.

One major studio learned this the hard way with its Web3 project when they listed their $500 NFTs with an accompanying fan accessibility story. The sale understandably flopped and they had to redecorate. The reporting and the business model must fit together. Build it right, and they will come. Call it Web3 without the benefits of Web3, and they won’t. This leads me to…

Courtesy and Customers (aka, don’t move the furniture until you’re a resident)

It may sound like simple advice, but it’s important: pay attention to and respect the progress of those who brought Web3 to this point. Progress is being made every day in this fast-paced space.

Stoner cats And Dead heads, two of the earliest examples of shows that paved the way for building a show on the blockchain, built huge communities of early adopter evangelists. Those communities understand authenticity and care about respect for the pioneers of the Web3 community. New projects would be wise to be a student of space and understand, honor and record progress. Not only will this help put your project on the right track, but it will also help you build goodwill among your community.

One of the most exciting aspects of Web3 in Hollywood is its ability to build highly engaged communities by giving them a role in content development. In an era where streaming platforms are fighting for survival and major studios are cutting divisions, early Web3 communities look promising to turn that tide.

Our first Web3 show, The gimmicks, gave NFT holders a chance to indulge in character storylines and plot arcs each week. An audience of just 5,000 NFT holders produced over 70,000 on-chain engagements (which are actually transactions in Web3) weekly, spending 15 to 20 hours per week viewing content, voting, DIC punching, creating Wikis and interaction with fellow community members.

This would be equivalent to watching the same show 40 times in one week, which is pretty much unheard of in the content world. That level of active involvement is also starting to look a bit more like gaming. And it’s also the kind of long-term involvement and passionate fandom that forms the basis of any popular entertainment IP.

For the writing team, this meant finding a way to balance community participation with creative oversight. Traditional Hollywood can have a hard time letting go of the reins. Participatory storytelling isn’t something that happens in traditional models, and for fans that means sitting back and enjoying (or not) in a reclined mode.

On The gimmicks, veteran Hollywood writers “The Daves” found they were able to balance overall creative control over a storyline of their creation while also opening avenues for weekly fan engagement. A key ingredient is knowing how to effectively use “prompts” and “white space” as a collective springboard for creativity and participation to help develop the world in a way that is authentic to both the character’s journey and the relationship of the fellowship with them.

Convergence: Silicon Valley muscle is critical to Hollywood projects

When producing a show in Web3, creators need to think in terms of the fan experience, not just the quality of the content. The most successful Web3 projects fall somewhere between passive video viewing experiences and interactive gaming.

Creating opportunities where fans can not only participate in storytelling, but interact with other fans in fun and creative ways are the elements that build community and closeness around content. This is where traditional Hollywood production teams can lean on the power of Silicon Valley’s technology companies to create unique social experiences that deepen fandom and harness the true power of community to build enduring entertainment IP/franchises.

Enter Hollywood 3.0

Web2 launched the ‘creator economy’ and opened the doors to many new storytellers, the best of whom were able to translate Web2’s success into mainstream Hollywood careers. But today, Web2’s platform limitations regarding auditing (changing algorithms affect reach) and monetization don’t provide the same opportunities for new creators.

For a variety of reasons — slashed budgets, competition, and risk-averse executives — even mainstream Hollywood creators and platforms are finding it more difficult to reach and retain audiences. Web3 has the potential to address both issues and usher in a new era of interactive entertainment that is a win for creators and executives.

John Attanasio is the co-founder of Toonstar.