Potential Benefits Behind the Blockchain and the Film Industry
Over the past several years the terms “blockchain” or “blockchain technology” are becoming increasingly popular, both in film and media as well as in many other industries. The potential benefits behind the blockchain and the film industry are still yet unknown, but there are some industry relative opportunities that stand out. In fact, when we talk about the potential benefits behind the blockchain and the film industry there are a few key points that come to mind: Transparency, liquidity, smart contracts, and accessibility.
What does all of this mean? How will the blockchain and the new technology behind it impact the film industry as a whole – or will it?
At Beverly Boy Productions, we’re thinking about blockchain technology a lot lately just like many other successful production companies are. We’re considering our role in initiating new technology and making the most out of the opportunities that are presented to us, and we want to be certain that we not only understand what we’re up against, but also that we apply new technologies in a way that is most beneficial for our industry. When it comes to the potential benefits behind the blockchain and the film industry, we think there’s a lot of potential.
Increased Transparency
If ever there was a lesson on transparency the blockchain is that lesson! It’s a large, public, ledger which not only makes every single transaction ever made available for view, but anyone that’s willing or interested has the ability to take a peak and see what’s going on.
What does this increased transparency mean for the blockchain and the film industry? It essentially means that there will no longer be “Hollywood accounting” or any area for the flow of money to be misinterpreted. Traditionally, the film industry is one in which there is a lot of money flowing from pocket to pocket. Keeping track can be challenging at best. With each stakeholder carrying a different “interest” or priority in the film, the lack of transparency can be troublesome.
Blockchain technology allows for each and every transaction associated with a film to be registered, permanently and publicly. This ensures honesty among the entire crew and ensures full transparency of financials which is incredibly important to investors, financiers, and others involved in the production.
Additional benefits behind the blockchain and the film industry can be seen in the transparency in decision making too. Keeping records on the blockchain ensures that everyone is aware of the decisions that are made and the outcomes. Where traditional films would be pushed to the big screen based only by industry insiders or the top studios that would get to vote for the film, the blockchain allows for crowd support rather than an exclusive engagement.
Improved Liquidity
Traditionally, funding a movie would mean you put money upfront and those funds would remain tied up for the duration of the production. However, another potential benefit behind the blockchain and the film industry is that there will be increased liquidity for funding. Stakeholders will not be condoned to lengthy contracts and commitments. Instead, stakeholders can actually commit as much, or as little, as they felt comfortable with. Stakeholders can invest as much as they want into a project and are free to pull their investment or to back out as needed.
Smart Contracts
Contracts might be the most beneficial opportunity behind the blockchain and the film industry! Because there is a blockchain record of every transaction and occurrence that occurs throughout the filmmaking process, there is reduced need for third-party involvement or attorneys in initiating contracts involved in the production process. Self-executing smart contracts are made between two or more parties and provided the conditions that are set forth in the agreement have been met, contract payments and other stipulations can be fulfilled automatically.
The use of smart contracting as part of the blockchain technology applied to the film industry means that fund collection, and distribution, can be performed more quickly and efficiently than in the traditional industry where there is much push and pull in order to initiate funding distribution.
Improved Accessibility
Traditionally, the film industry is one of the most difficult to penetrate. A grandiose market in which it is widely known that just a few major studios carry the majority of the production contracts and distribution deals, any steps that new technology could take toward improving accessibility in this industry would (and should) be welcomed! Blockchain technology decentralizes exchange processes and can improve likelihood for films to be greenlit without control by specific studios.
Rather than a few studios governing or holding the keys to the industry, instead blockchain technology will make it possible for films to be funded by the people. Rich or poor, if you believe a film has the potential to do well, you can push it toward production. Anyone has the right and ability to introduce a film or film idea into the blockchain democratizing the entire system!
These and other potential benefits behind the blockchain and the film industry are important considerations for any filmmaker or film production company that is considering this new technology as part of their practice.