7 Lessons from the Future of Content: Part Two — Let’s Play Risk

David Dylan Thomas
Jan 21, 2016 · 7 min read

In part one, we discussed how the cost of production has changed radically, but the cost of spending time on a project has not. Now let’s talk about a possible remedy.

Lesson Two: Redistribution of Risk Changes Everything

Design Credit: Shannon Patrick

This is the old way.

An artist gets commissioned to create a work by a larger entity—a studio, a distributor, a publisher—who pays in advance, essentially funding and buying the work in advance. They now own the work.

As a result, it makes perfect sense for them to have certain controls over the work. They put up all the financial risk, after all. So, if they want final cut over that movie, they spent $200 million to fund it, damn right they have final cut. They want to decide who will be a movie star? They’re spending all that dough, damn right they’re going to decide who will or will not be cast.

As owners of the work, they mediate the relationship between the artist and the audience by controlling the relationship between the work and the audience. Again, because they assumed all the risk, it makes perfect sense for them to control how the audience interacts with the work. Digital Rights Management? Damn straight. I have every right to sue you for putting Mickey Mouse on your face cake (for realz). Also, the price of admission. I’ve put up all the money so I’ll calculate how much I need to charge per ticket, album, download, etc. Why would it be any other way?

All the things we complain about, especially in a digital age, around how companies control the rights to their work, how they treat the audience, how they treat the artist, even how they approach diversity (more on that later) are a natural and expected outcome of centralized risk. And I can sympathize. If I put up $150 million for a work of art, I have 150 million reasons to control every single aspect of it.

Now let’s look at a different model.

Design Credit: Shannon Patrick

If I distribute the risk for a project across 100 people, 1,000 people, 10,000 people, things get weird. First of all, instead of a studio mediating the relationship between the artist and the audience, we have a platform enabling that relationship. So a Patreon or a Kickstarter or a YouTube becomes a means of distribution and communication and transaction as opposed to a financier in their own right.

So as an artist, I can negotiate final cut either by keeping it entirely to myself (since we’ve already agreed on what I’m going to create, you’ve already “paid” for the product) or share it with you and collaborate with you, the audience, on the creation of the artifact.

This also means that I can keep extremely tight rights control or extremely loose because, again, I’ve already passed the point of risk. I’ve already made (if the crowdfunding was well-structured) all the money I need to to create the project and sustain myself and my staff during the creation of the project (and here lies the potential remedy to devote time to the project). So I don’t have to worry about rights management as a way of securing my investment (or yours).

As an audience member, I get to determine the price because the “price” is my level of investment, and it’s never so large as to warrant creative control. Even at the highest price point of $10,000 (about as high as any crowdfunding contribution ever goes), that’s still a fraction of what would be invested in a centralized risk model, and a small percentage of the project cost overall.

Radiohead released In Rainbows on a pay-what-you-like model, even if what you liked was zero. So, of course, the average price of the album was zero, right? Nope. $5.00. The “crowd” actually does want to support artists, even when it doesn’t have to.

Also, instead of a studio, the audience also gets to choose who becomes a star. They become the gatekeepers. Recognize this guy?

No? How about now?

This is Spoken Reasons. He’s a comedian who couldn’t get booked in clubs so he started filming his comedy on YouTube. Over five years or so he built up a following of over 1 million subscribers. This got him on the radar of YouTube itself, who’s (very smartly) got into the business of talent scouting, who in turn put him in front of Paul Feig, the director of The Heat.

Reasons’ co-stars, Melissa McCarthy and Sandra Bullock got to that film the old-fashioned way. Institutional gatekeepers, casting directors to studio heads, helped put them on the radar. Spoken Reasons didn’t have a single film credit to his name before that movie. The crowd decided he was worth paying attention to without a gatekeeper putting him in front them. One by one, over time, they made the choice and in aggregate they put him in front of the establishment.

And that’s assuming that for Bullock, McCarthy, and Reasons the end point is the same — a big Hollywood contract. But let’s have some fun with math. Spoken Reasons now has 1.8 million subscribers on YouTube. If only 5% of them decided to give him $1 a month, he’d make over $1 million a year.

He doesn’t need Hollywood. Hollywood needs him.

So if your goal isn’t, per se, to be rich enough to buy the Lakers but to be rich enough to continue doing what you love and perhaps support a family, then maybe there’s a path now to a middle class existence as an artist.

The era of the media barons and gatekeepers will, from a wider perspective, appear to be a weird anomaly, an off-period in the conversation between artist and audience. — John Paxton

There’s a trust and bond that develops between an artist and an audience that this type of ecosystem can support better than the traditional one. It can, in fact, leverage that relationship to be the engine, rather than the thing that gets messed with, when an artist tries to thrive.

If you look at the web series Con Man, produced by Alan Tudyk and Nathan Fillion, they explicitly reference this relationship. In the pitch video for their crowdfunding campaign, they say that they could go to a studio for this money but they have “trust issues” with studios. So it’s not even a question of whether or not they can get the money but the strings that would be attached. If they didn’t get x number of viewers in y amount of time, the ax comes down. Whereas they, implicitly, do not have those trust issues with their audience. Where there is trust , there is creative freedom. And distributed risk enables trust.

How do we monetize enthusiasm without breaking it? — Linda Holmes

This approach also opens the door to a more collaborative relationship between the artist and the audience. HitRecord is an “open collaborative production company” created by Joseph Gordon-Levitt. It allows for many contributors (an animation here, a screenplay there, a piece of music there) to one piece of content (video, album, etc.). The rights to each contribution belong to the contributor. If I contributed a song, I keep the rights to that song (if I so choose). The rights to the collective work belong to HitRecord. Similarly, the profits are split 50% to the contributors and 50% back into HitRecord.

This is only one model for collaborative production, and it is profitable and scalable. HitRecord has already had two TV seasons with an Emmy to spare.

After the rousing success of The Avengers, Joss Whedon, the film’s director, posted this to Whedonesque, a fan blog.

I have people, in my life, on this site, in places I’ve yet to discover, that always made me feel the truth of success: an artist and an audience communicating. Communicating to the point of collaborating.—Joss Whedon

This is the new vision for what a relationship between an artist and a community could feel like, could actually be like. And it brings us to our next lesson in the future of content, which will put some serious guardrails on the pie-in-the-sky vision I’m putting forward…

David Dylan Thomas

Written by

Content strategist, filmmaker, idea-o-phile, @movie_pundit. Director of Developing Philly, @devphilly, Creator of Content Camp, @content_camp