Escaping Development Hell - Blockbuster
Using NFTs to Find and Build Great IP
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Today we have a special guest post from Jon Rogers, formerly the founding executive and global head of live-action franchise development for Walt Disney Studios.
Overpriced JPEGs has teamed up with Jon to create Blockbuster, a recurring series that looks at what is happening across Hollywood, the global media industry, and the blockchain.
Jon is a brand leader with 20+ years of experience in media/entertainment, consumer packaged goods, and most recently Web3. Prior to Disney, Jon was a member of the Star Wars brand marketing team at Lucasfilm where he managed theatrical campaigns, brand partnerships, and retail marketing. Earlier in his career Jon was a strategy consultant with Booz Allen Hamilton working with clients in media/entertainment, high tech, and oil & gas industries.
Hollywood has always been steeped in contradictions: obsessed with the new, but tethered to the old. It is an industry perpetually on the lookout for the next hot star or “visionary” filmmaker, but it is simultaneously hidebound and slow to change its ways until the system is forced to grudgingly adopt new innovations.
Thrust into this contradiction is the emergence of blockchain technologies. Blockchain will be transformative for the entertainment industry over the next decade and will impact every step of the value chain. As I have written before, this makes it an architectural innovation that studios must reorganize and reengineer their business processes around.
The next several editions of the Blockbuster newsletter will look at how blockchain will affect the media and entertainment value chain across three verticals:
1. DEVELOPMENT - The “concepting” phase
2. PRODUCTION - The “making” phase
3. DISTRIBUTION - The “go to market” phase
We start today with “development” – the process of originating an idea for a film and turning it into a script that’s ready to shoot.
For more on this, check out our recent episode of Blockbuster on the Overpriced JPEGs podcast & YouTube!
The four biggest challenges to the traditional development process are cost, time, uncertainty, and appeal. Let’s look a moment at each.
It is not uncommon for a studio to invest several million dollars into an idea during the development phase. These expenses primarily go to multiple, and at times seemingly endless rounds of rewrites and edits. Along the way the project racks up expenses for writers, producers, and researchers to contribute to the project, not to mention the studio overhead (internal costs such as staffing, legal, admin…). All of these costs add-up and are attached to the project. These costs may never be recouped if the final film underperforms or is scuttled entirely.
The time it takes to see a project from an idea to a ready-to-shoot script is the second major barrier. I recently tweeted about the new Haunted Mansion movie coming this summer. I worked on that movie at its earliest stage of development over 12 years ago. When you read about “development hell” – 12+ years of development time and money is the perfect example of that.
Despite many millions of dollars spent on the best writers and filmmakers (Haunted Mansion originally had Guillermo del Toro attached to direct), studios must still deal with tremendous uncertainty and therefore risk on the investment. This is why studios shifted their focus to franchises in the early 2000’s, (an architectural innovation in its own right, which I’ve written about for this newsletter) precisely to mitigate that risk and uncertainty.
How do development teams identify new stories and characters with appeal while at the same time minimizing risk, time, and cost? One way is to acquire proven titles in other media such as publishing, Broadway, or scouring their own libraries for titles to reimagine. The problem with this approach is that their libraries have been picked over by the vultures many times over, and acquiring IP from outside sources, such as publishing, is highly competitive while the best (current) opportunities are already locked-up.
This is partially why video games are resurgent as a source of potential IP for film and television. Hollywood desperately needs more sources of differentiated stories and characters to draw from if we ever hope to get out of this endless cycle of lather, rinse, repeat – seeing the same old franchises come back again and again.
When I talk with the Hollywood studios, here is what I tell them → now is the time to make a small investment to incorporate blockchain into their studios at the development level. This doesn't have to be a radical change. Take small steps now, with larger steps saved for later as confidence builds.
HOW DO YOU DO THIS?
I specifically recommend two actions.
1. Bring Web3 IP To You
Hire a development executive knowledgeable in Web3 storytelling and community building. Empower that executive to close deals that bring web3 story projects into the studio development pipeline.
That exec should also be on the lookout to potentially strike “first-look” deals with Web3 studios and then begin collaborating with them on the development of new IP. The recent partnership between Amazon Studios and Superplastic is exactly the approach I am prescribing. More of this please!
(For more on what this means, check out our recent episode of Blockbuster called “Escaping Development Hell” on YouTube or wherever you get your podcasts!)
2. Bring Your IP to Web3
Utilize Web3 as a testing ground for new IP that is advancing or stuck in the development pipeline. Rather than letting a project sit for more than a decade in development hell, divert it into a Web3 storytelling project. Build a community around it. Collect data and audience feedback in real time to help inform the ongoing development efforts. I can imagine a studio development pipeline in the future where this major cost center becomes cost neutral or even a small profit center.
The upshot is this: Hollywood desperately needs to breathe fresh life into its IP development process and NFTs represent a new and the best opportunity for doing so.
Is there any web3 IP out there that’s as de-risked as, say, Harry Potter? Hell no! But the reality is there are no Harry Potters on the market right now. And when they do come around, the bidding wars for them are fierce.
What web3 does provide, is a solution that is simultaneously cheaper and quicker, and certainly better than taking shots in the dark or burning out all of your best franchises in a vicious cycle of endless reboots.
You would think given the stakes, Hollywood would be jumping at the opportunity web3 represents. But, of course, that’s not yet the case. While modernizing is constantly discussed within studios, when it comes to taking action, those efforts stall because execs are afraid of upsetting or disorienting “the talent,” and along with vicious internal politics, these organizations are holding themselves back from doing what needs to be done.
But I believe what I’ve described above is inevitable and those who adapt the fastest will have an advantage. When it comes to architectural innovations, incumbent leaders typically lose the most, as they are the slowest to adapt, but it doesn’t have to be that way. If the incumbent leaders in Hollywood start with the small steps listed above, they will be on their way. I like to say, what do the studios have to lose for giving this a try? What do they have to lose if they don’t? Well, everything.