Evolving Money: Rebuilding the Creator Economy (Sponsored Content)

Because you're a subscriber to this Bloomberg podcast, we thought you'd be interested in a sponsored podcast called Evolving Money, produced by Coinbase and Bloomberg Media Studios. It explores how money has changed over the centuries and whether cryptocurrency is just the next logical evolution of how we pay for things and store long term value. Here is a recent episode.

Every day, billions of people share their creativity online, but when their creative work goes viral, who benefits? Imagine a young woman, a dancer with a modest social media following. One morning, she comes up with a new dance at the kitchen table and posts a video. Her followers don't just like it and scroll on. They start imitating her moves and posting their own versions of the dance, and big media channels get a ready made story by covering

What a name, right. The Stationers are everybody who's involved in the making and distribution and sale of books, so printers, binders, type founders, the people who sell the books of the public.

That's doctor Adrian Johns. He chairs the history department at the University of Chicago, specializing in the histories of science, the book, media, and information. This group of publishers, the Stationers, have a royal warrant to print and this warrant protects the stationers from competition.

It was essentially a monopoly, a kind of cartel that looked after the whole trade.

Locke is one of the loudest voices in a chorus of thinkers, writers and printers calling for an end to the stationer's monopoly, and eventually, in sixteen ninety five, the Crown lets its royal warrant with the stationers expire.

When that act lapses, there's no legal sanctuary more against pirating books. It's a kind of golden age for literary piracy. So whatever you write is free game for anybody.

This period of anarchy lasts for about fifteen years until seventeen ten, when Parliament passes a new act, the Statute of Anne. Now, if any other person who isn't explicitly approved by the author to print or reprint their work tries to reproduce it, the author can basically say hey, stop, that's mine and ask a court for an injunction. This was,

In practice, if you have to tow biggest publishers in London all collaborating on this. They have enormous power, so de facto, these congers kind of act to preserve the same kinds of rights that the station as company had always registered before.

So the vast majority of writers still don't have real control over how their works are made public or what they'll earn from their ideas. The same dynamic continues in some form to this day.

So we've seen notoriously, through various mergers and so forth, the development of sort of super media firms that hold the publishing houses together. This idea that the commanding heights of the literary culture are held by a relatively small number of very powerful commercial operations. You know, it feels a little bit uncomfortably like we're back to that.

As the world has moved online, so have the same issues around consolidated power and ownership rights that have plagued creators for quite literally centuries.

I think if you look at the last twenty years, with the creation of the Internet, we've seen the emergence of these incredible platforms that have connected people all around the world.

That's Jesse Pollock, VP of Engineering at coinbase and creator of.

Base, but I think at the same time, one of the big challenges has been that as people have brought their creativity online, they've predominantly brought it into these platforms that they don't control.

Our own Base is a platform that people can use to build all kinds of apps with blockchain technology. Jesse told me he created the platform because he wanted to help content creators and small businesses take true ownership of their work by building more direct relationships with fans and customers and deciding how to earn money through those connections.

So let's say you're creator and you make a video. You take your video, you put it on a platform, and then it gets distributed kind of based on an algorithm that you can't see or understand. You get paid whatever that platform decides to pay you, which is a total black box.

But if you're a web creator, it's not like there's much choice, and.

If you say, hey, I want to take my distribution somewhere else, you don't actually have that option. You are stuck in the existing system.

And so the creator is left making whatever money the platform offers them. Jesse estimates it's about five percent, and the platform keeps the rest. Then the creator has to pay transaction fees and phase delays in getting paid.

And that's a thing that I think just in the last few years, people are waking up to as they see, Oh, I feel like I'm getting scraps when these corporations are making hundreds of billions of dollars. And I think that collective awakening is kind of bringing us to a new moment where we're realizing, Hey, maybe we need better tools, maybe we need better platforms, and maybe we need a better internet that actually puts creators first.

That phrase a better internet, Jesse means that literally. He thinks that blockchain platforms can the essential tools for communication, purchases, and analytics outside the walled gardens of today's social media. This wouldn't just shift the places where content goes viral, it would also shift where people make money and how new revenue models can take off. I asked Jesse to walk me through this transition, starting with the difference between

On chain is the next generation of the Internet that's built on blockchains like base and it's a powerful internet where everyone everywhere has the same access and it is on a level playing field where they're able to build and use new apps that are ten x better.

So how will that look? What change will that mean for creators When it comes to things like owning my art and getting paid for it and reaching my audience.

You do the exact same thing. You take your music, you take your video, and you put it on chain, but now all of the algorithms are open, so you can actually understand what's going to lead to more distribution versus less distribution. And if you want to take your network to another app because you're excited about trying something new, you can just take it with you because it's yours.

So the creator retains control over the distribution and monetization of their work. And as more creators see that benefit and take their work on chain, the enormous slice of revenue that they're used to handing over to social media platforms could fuel a new network of businesses.

That network that you're distributing to is not controlled by one company. It's open and accessible to everyone who wants

The musician example caught my ear because I'm always keeping tabs on my favorite artist and trying to see if I can catch them at a live show. Jesse showed me how my relationship to my favorite artists could be much more personalized if each step were brought on chain.

I think the thing that's really powerful about the new on chain platform is that these creators, these musicians, they can actually build a deeper relationship with the people who

Say I buy an album, then buy some merch then watch their live stream. If this all happens on chain, the artists will be able to directly track all all of those interactions between us across any app and use that to personalize or deepen our relationship.

The artists are then going to be able to look across all that and say, oh, here are the people who've listened to me on this app and that app and showed up at my show, And now I'm going to say, okay, let's give them a targeted experience. For instance, let's make it so that they can be first in line for purchasing.

Tickets, or the artists could send me personalized messages, exclusive set lists, or invite me to a post show meet up with other super fans.

With this new on chain infrastructure, we're actually going to be able to build more customized, more human, more direct experiences that let artists and creators reach their most important, most connected fans, give them better experiences, which will make that relationship deeper and really be a win win for both the creative side and the consumption side.

This new on chain world isn't just theoretical. It's here now.

We believe that we're building a next generation entertainment company.

That's Julian Holgan as the president of Billboard, he transformed that brand from a music trade magazine to an international multiplatform experience.

Now.

Julian is the CEO of Doodles, a digital entertainment platform that's built entirely on Chain.

We're basically what a modern day cartoon franchise might look like. We make short films, We make original music. Those often come with music videos, animated music videos. We do digital comics, illustrated posters. We really use humor in all of our content.

But Doodles is also a social community in the Doodles universe. When users sign up, they create a digital avatar, a Doodle, which they can customize however they want. Because the avatar is on chain, it's completely unique to the user.

People use avatars to communicate constantly. They make gifts, they make stickers, they make short form animations. And what we're basically letting people do is take our ip our brand customize it to fit whatever they want their digital likeness to be.

That avatar also has something Julian calls a collector's profile, where they can pay for videos, illustrations, and animations from the Doodle's universe, so they get to create a permanent identity and show off their fandom with content they truly own. Doodles recently collaborated with Pharrell Williams and Lil Wayne to produce Project Gray, a short film hosted on the Doodles Network.

A twenty minute short film that would ultimately set the foundation for all the storytelling that we wanted to do in our universe.

During the making of Project Gray, Doodles included some of its users on chain avatars. In the actual film.

They can say to their friends and family like Hey, I'm in a Pharrell music video, Like this is a really kind of novel concept that doesn't exist in any other form of media.

That moment pointed to the future of immersive content where every viewer had a concrete stake in the story they were watching. The film ended up premiering at the twenty twenty four Toronto International Film Festival.

The audience they were blown away, like there were people crying, There were people like that. It gave them chills because it's truly becoming a community, it's truly becoming part of the IP and the brand versus just a passive participant.

Doodles posted the short film on YouTube for everyone to see, like all of its original content, but Doodles also allowed people to buy tickets for the film on chain and users could add the film to their collectors' profiles. In the end, they sold more than fifty thousand tickets.

And that concept right there is unheard of for most creators. Wait, you can sell content and people want to own that content. They're willing to pay you a dollar fifty cents thirty cents to own collect that And the answer is yes. And I think the more and more people start learning about distributing content on chain, the more people are going to be drawn to it. And a lot of that really boils down to how can you have fun with your friends on the internet.

Going on chain can give economic power back to creators and help them create stronger relationships with their fans. And this community building aspect of the technology goes beyond the digital economy. Like, if you're dining out in New York City anytime soon, you could check out an on chain app called Blackbird. Here's coinbase is Jesse Pollock.

Again, they're building a new product on chain that lets restaurants build that more direct relationship with customers.

Blackbird is kind of like a traditional dining rewards program, but by going on chain, the app gives restaurants a direct, transparent connection with every customer who's using it to make a reservation, check in, or pay for their meal.

So when a customer goes in they just tap their phone. The restaurant now knows who they are, they can kind of customize the experience around them.

This creates an easy to see history for every Blackbird customer at the restaurant, a personal profile that follows every interaction you have, which really matters to restaurants who thrive on building a community of local diners.

And then over time, as you show up more, you're actually building kind of who you are, what you love, which you can then choose to also take to other restaurants, which means you're going to have a more intimate experience at every next restaurant that you show up at. There's now hundreds of restaurants in New York City that are using this platform to make it so that they can have more direct relationship with their customers.

Companies like Blackbird and Doodles are trailblazers today, but as more businesses create closer relationships with their customers by going on chain, these kinds of apps could become the new normal.

And so what I think we're starting to see right now is almost this exponential ramp where people are seeing whoa this thing is new and it might look small right now, but if I opt into it, I can live a better life for my small business, for my music, for my art, from my day to day living as a consumer in the American or global economy. And I think as more people see that, we'll kind of see this transformation where the world shifts from online to on chain.

In eighteenth century England, publishers did everything they could to maintain control and profit off author's original works. These guys were classic gatekeepers, setting the rules for how ideas and voices could be heard. Centuries later, we're still living with