The digital content industry is broken and in need of disruption
We’ve given in to monopolies — nowhere more so than in the realm of digital content — it now seems that there is only ever one place to go for the three elements all consumers crave: Value, Range and Convenience.
The platforms that offer superiority in all three of these key areas are the ones that stand aloft, up and away, apart from the flailing competitors below. And we all continue on, in most cases via subscription, consuming the content that they dictate we consume, and all the while they offer up a pretence of ‘tailoring’ what we play, listen to, watch or read to what they think we want. But essentially they don’t really mind what we consume — aside from content they’ve created in-house — merely that we do.
This creates a ‘log-jam’ of content, and essentially a broken system whereby you have millions of products, yet only a handful of platforms that distribute them. So our increasing predilection for, and growing dependence in, the closed platforms such as Steam, Netflix and Spotify, is inadvertently leading to an increased skewing of content away from small to mid sized, more niche content creators and game developers, and towards the sorts of big producers that can both shoulder the massive 30%+ levy that they take from every transaction, and also have the marketing budgets to ensure they get the necessary front-page exposure to get their content consumed.
It might seem, then, that the very idea that their days are numbered is patently ridiculous, after all, who can even imagine these giants being unseated from their thrones, and consumers satiating their content addictions elsewhere?
Well we would do well to remember the graveyard of businesses that failed to adapt in past decades:-
The 1990s
It was us humans that did the distrbution
The 2000s
The Royal Mail was kind enough to get our content home.
The 2010s
As we know, faster broadband took over delivery duties:
And as each decade passed, it always seemed like the giants were unseatable.
But now it seems, a new threat to their dominance is appearing on the horizon… decentralisation and distributed trust networks.
The 2020s
These new protocols will step in as challengers to the closed platform hegemonies we currently tolerate, and the main reason for this is they offer concrete solutions to the many challenges copyright holders have faced over previous decades:
Piracy
High cost of Advertising
International rights issues
Monetizing P2P sharing
Now it seems that these blockchain-based technologies might actually provide solutions to all of the above.
Piracy — The immutable ledgers of Blockchain and DAG structures will allow copyright holders to be accurately and fairly compensated with each transactional instance.
Advertising — As each piece of content is consumed, all remuneration for hosting and sharing the content is specifically linked to the product alone and therefore advertising spend can be highly targeted.
Rights Issues — Smart contracts wil trigger precise remuneration according to the specific instance of content consumption, rendering DRM near-obsolete.
P2P — Through transparency and immutability, all stakeholders in a P2P transaction can be fairly and accurately remunerated, and distribution incentivized through micropayments.
I think most people would admit that the dominant platforms such as Netflix, Steam and Spotify, whilst undoubtedly offering full convenience, they only offer the required value and range if you are interested in a narrow band of products. For example, if you wanted to watch Ridley Scott’s Alien at your leisure, you would find Netflix lacking, and be forced to buy a £7.99 download which would only ever play via Amazon’s website. Same goes for the Adrian Lyne classic Jacob’s ladder, but that one would set you back a princely £10.99! So of course, you settle back to watch Season 2 of Ozark, telling yourself it’s essential.
I want to just click a link and watch any movie, play any game, hear any album or listen to any audiobook I like, anywhere in the world, on any device I choose, and to pay a market value for it, but at the moment for many this feels like a remote prospect.
People need to take heart that actually one day all this and more will be possible, through the power of blockchain-based technologies.
Major cracks are showing in the way we consume digital content already:
The idea that even if you purchase, say, a £10.99 download, a closed platform like Apple, can and does routinely simply delete it from your account due to the rights deals no longer existing between them, and, say, Disney, is a scenario that will erode consumer confidence yet further.
In a decentralised ecosystem, once you’ve bought a movie, you’ve bought it. Period. For ever. Immutable. You can download and redownload the content to your heart’s content for ever, as you own the license.
Until you sell it on or your kids inherit it.
The holy grail.
I am fortunate enough to be working with the mercurial talents behind Catalyst, whose ambition is to be a part of a new wave of decentralised P2P distribution systems for digital content which will play their part in an imminent mass-disruption of the entertainment industry.
One thing history has taught us is that there will be casualties of the streaming era of the 2010s, more content platform equivalents of the Blockbusters, Tower Records, and Barnes and Nobles of the world consigned forever to the dustbin of corporate history.
Maybe.
