Non-fungible tokens (NFTs) continue to baffle some. While there is a lot of hype surrounding NFTs in the media and entertainment industry, there is also a lot of skepticism and criticism. Some critics discredit NFTs as nothing more than expensive JPEGs bought and sold online. Even more reserved skeptics often describe NFTs as if they were synonymous with NFT art or a digital art file.
But when we dig deeper and understand the unique possibilities of NFT, it becomes clear that NFT is much more than just JPEG. NFTs are the “golden promise of Web3” and are especially capable of changing the media and entertainment industry. Some of the most exciting features of NFTs lie in their ability to open beneficial access for NFT holders, including access to benefits, access to experience, and access to the community.
Unlock access to benefits
Much of the appeal of NFTs comes from the unique access to the benefits they provide to their holders. We are increasingly seeing NFTs being used as part of subscription or membership models that provide subscribers and members with unique benefits. Using a subscription model, media and entertainment companies can provide NFT holders with access to benefits such as premium access to products, limited edition products, or other rare and valuable benefits. Companies can also create access passes, similar to digital tickets, that grant holders access to various closed benefits. World-famous DJ Steve Aoki, for example, created an NFT membership club called A0K1VERSE, where NFT holders get exclusive access to physical and digital rewards such as free concert tickets.
Media and entertainment companies are likely to follow in the footsteps of companies like Starbucks.
Although NFTs use the latest digital technologies, the benefits they provide are not limited to the digital world. NFTs can also offer benefits in the form of physical items such as collectibles, clothing, and more. We have seen NFT collaborate with companies such as Adidas and Bored Ape Yacht Club, as well as with GAP and Frank Ape. Gap, for example, partnered with Frank Ape to launch a gamified NFT experience that turns physical sweatshirts into digital collectibles. This type of gamified NFT experience also aims to change media and entertainment.
Providing access to experience
NFTs also provide holders with access to unique, valuable and rare experiences. These experiences run the gamut and range from in-person to virtual experiences. Flyfish Club is a private dining club scheduled to open in 2023. Entrance to it is paid as NFT. Owners have unlimited access to over 10,000 square feet of New York private dining and other culinary experiences. Flyfish is one of the NFT “social clubs” that are emerging amid the rise of NFTs and leaving a mark on the entertainment industry.
The NFT-based experience also appears as an event-based experience. For example, earlier this year, Coachella announced a set of collectible NFTs in the form of a digital Coachella Key. Coachella Key Holders Receive Lifetime Festival Passes Every Year forever and everas well as various other experiences such as a celebrity-cooked dinner at the Coachella Rose Garden and front and center views of the Coachella stage.
We also see some of the more traditional NFTs merging with new, experiential ones. For example, when serial entrepreneur Gary Vaynerchuk launched his NFT collection called Vee Friends, he gave holders access to the annual Vee Con in addition to giving them access to digital art.
In addition to providing access to benefits and experiences, NFTs also create and provide access to a community. This was fully manifested during the Ukrainian crisis, when the country and its supporters around the world rallied through the NFT. The government of Ukraine raised money from the NFT, which was used as war bonds. Ukrainian NFT artist Artem Gumilevsky (along with many others) has earned many fans by creating self-portraits that have become a powerful collective symbol of resistance for Ukraine and its people. And TIMEpieces, the Web3 NFT community from TIME the magazine has created an exhibition entitled “Make Art, Not War”, the proceeds of which go to Ukrainian humanitarian and rescue operations.
In addition to unlocking community access, NFTs can also be paired with an exciting ownership component. Decentralized Autonomous Organizations (DAOs) are communities that are collectively owned and operated by their members and that allow members to invest in NFTs and NFT collections. Even beyond DAOs, NFTs can have powerful ownership components. Bud Light is one of many companies that have benefited from this property. Corey Brown, Senior Director of Digital at Bud Light, explained that “NFTs continue to redefine the way we think about community and ownership, technology and all of that.” Bud Light recently announced NFTs as part of the launch of their Bud Light Next zero carb beer. Buying an NFT gives owners access to merchandise, brand and partner events, and certain voting rights in brand decisions such as product design.
More than JPEG
There are reasons to be skeptical about NFTs. There will inevitably be roadblocks ahead. And some NFTs will still be dizzying — such as a nearly $400,000 low-resolution cartoon whale created by a 12-year-old. But NFTs are here to stay and must continue to disrupt the media and entertainment industry. One of the key factors in their value and likely longevity is the lucrative access they provide—in the form of access to benefits, experience, and community.