Web3 Done Right: Token-Gated Access May Be the Ticket for Hollywood | PRO Insight

In a recent column, I wrote about an example of what’s wrong in the NFT world from the creative community’s perspective. Specifically, OpenSea recently changed its resale royalty policies and now prioritizes buyers and sellers over the creators who built the value of its marketplace in the first place. This week, fortunately, I can point to an example of Web3 in Hollywood done right — something that places creators front and center and connects them directly with their fans and audiences to unlock new value. The formula is essentially more taste (exclusive access), but less filling (NFT jargon).

This week, “American Idol” creator Simon Fuller’s new “The Musical: Welcome to the Night of Your Life!” motion picture musical debuts exclusively via token-gated tickets on Web3 app OP3N. Fuller’s new musical features his international pop super group Now United, which has a rabid fan base, particularly in Brazil. (Full disclosure: I’m an advisor to OP3N.)

Digital tickets serve as a pass to grant fans exclusive access. This is what’s most interesting to me about scenarios like this: the ticket itself, which defines myriad possibilities of value, becomes both a collectible for fans and a canvas for artists on which to paint the type of experiences they’d like to offer (and monetize). Fans will choose from three tiers of tickets, each of which unlocks different levels of additional value and experiences. Those fans will then securely access the film, soundtrack and additional benefits that include access to band members themselves.

“This project allows me to redefine how an audience can engage with content,” said Fuller. “Not only can it be enjoyed simply as entertainment, but fans can now actually participate.”

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This is a big deal for what it represents. First, Fuller is a leading figure and innovator in the world of entertainment, and his vote of confidence in this still-nascent Web3 space matters. Others will follow suit. Second, Fuller’s motion picture represents one of the most ambitious entertainment projects yet to be exclusively distributed on the blockchain. Third, this implementation with multiple tiers of tickets at different price points and with different benefits demonstrate the type of creativity that the entertainment community can bring to audiences via Web3.

This is precisely the type of reciprocal exchange of value long promised by NFTs, but that few have delivered on thus far. Creators, in this case Fuller and Now United, make more cash and get more reporting transparency by going direct to their fans and bypassing gatekeepers and middlemen that extract tolls. They also now know who their fans are and can communicate directly to them to deliver (“airdrop” in Web3 parlance) new benefits over time and market new, ongoing revenue-generating opportunities. Meanwhile, audiences (in this case the Now United faithful) make more memories by joining a community of like-minded fans who access entirely new experiences and benefits, including potential direct access to the artist themselves (a benefit offered here).

Crucially, Now United fans pay with credit cards rather than being forced to figure out how to create crypto wallets and swap dollars for ether before they can even buy anything. The familiar interface doesn’t even mention Web3 or NFTs. The blockchain mechanics are invisible. And that’s the point!

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The benefit to creators, of course, is that Web3 enables a new direct artist-fan channel with endless new possibilities, and with significantly better economics. That’s why other Hollywood players like the Tribeca Film Festival already play in the Web3 game. Tribeca is now selling “NFT Passes” to its June event. (Clearly they didn’t get the memo about calling them digital “tickets” or “collectibles” instead.) Benefits include exclusive access to special festival events.

Other well-funded Web3 players with lofty entertainment ambitions include YellowHeart, which released the first major NFT album with Kings of Leon in 2021. YellowHeart also offers token-gated exclusive access to music, opening up a new release window for content that ultimately finds itself elsewhere and demonstrating, once again, that fans pay up to get down. YellowHeart CEO Josh Katz calls ticketing “a perfect use of NFTs.”

YellowHeart, OP3N and others that share Web3 DNA demonstrate how “digital tickets” and “digital collectibles” (in other words, NFTs — just don’t call them that!) can become a boon to the entertainment community. Blockchain tech also promises to clamp down on ticket fraud and scalping, and enable creators to receive an ongoing royalty for resales (OpenSea’s lack of enforcement on this point is what got the company in trouble).

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Web3 even empowers fans to invest, literally, in their favorite artists, filmmakers and content franchises, thereby offering the creative community a new source of financing by an audience both emotionally and financially incentivized to watch, listen and market to others. That’s not happening here with Fuller’s project, but music distributor Royal is doing just that, promising to let fans “invest in in music” and “earn royalties with every stream.”

Just as with anything in Hollywood, relationships matter most. And the artist-fan, creator-audience relationships are paramount and should sit front and center. Entertainment icon Fuller is showing the industry where to take Web3 — and how not to let jargon and technical complexity get in the way of a good time.

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Twitter @pcsathy.

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