Coming Soon To A Theater Near You: Web3
By Greg Kahn
Emerging Tech Exchange
Founder & CEO
Published on April 7, 2023 - VARIETY (Source)
Web3 and the movies might seem like vastly different eras of media and entertainment, but they actually belong together.
Sports leagues, retailers, events and gaming are all beyond the Web3 exploration stage, and now Hollywood, too, must jettison its aversions to technologies that are upending conventional loyalty, merchandising and content distribution.
Let’s All Go to the Lobby
Movie attendance came back in 2022, driven largely by hits like “Top Gun: Maverick” and “Jurassic Park: Dominion.” Still, audience numbers have yet to return to pre-pandemic levels, as despite their seeming spectacle, major theatrical releases are not enough to get people off their couches. Theater operators and film studios can solve that with the special effects of Web3’s immersive touch.
Wait, Web3? You mean that horror show starring cryptocurrency, blockchain and NFTs?
Such a reaction is not surprising. Observers have been spooked by the spate of negative financial news since last fall’s implosion of crypto marketplace FTX. Just last month, Meta decided to abandon its focus on NFT collectibles amid a wider pullback on the social network’s expensive push into the metaverse, and Disney followed suit as part of its axing of some 7,000 jobs and overall cost cutting.
The promise of stability pushes aside risky experimentation in times of chaos. But as waves of consumers ignore traditional media in favor of “micro-communities” sprouting up from the creator economy, playing it safe appears to have very clear downsides.
While sports, music and business conferences have revealed the pent-up demand for mixing in-person and digital gatherings, movie theaters have a much more natural mass appeal than those other venues.
Currently, there are 2,200 movie theaters in the U.S., a slight increase from 2022, according to market research firm Ibis World. With neighborhood cinemas still so ubiquitous, chains should be able to take advantage of enormous opportunities to be a center for micro-communities and mixed reality in person.
After all, theaters have long made room for arcade games in their lobbies. Why not open those spaces for mixed-reality activities that connect to the big screen?
A Web3 Reboot
By aligning on Web3, studios and theater chains can meet their competition for audiences head on. For example, video gaming is the most popular media form for younger consumers — and at the forefront of using immersive tech to draw in fans with virtual goods.
As the 100-year-old Walt Disney Company moves to blend digital and physical experiences at its theme parks, streamer Disney+ could be the initial gateway. Last year, the brand held a Disney+ Day, a loyalty offering that gave special access to parks, cruises and hotels.
Back on board at the company, Disney chairman and CEO Bob Iger is showing greater interest in Web3, as he recently took a seat on the board of metaverse avatar platform Genies.
Meanwhile, sports leagues including the NBA offer a blueprint for Hollywood, and the future of hybrid digital/physical in-person entertainment is already going on outside of venues. Could movie theaters take a page from Pokémon parent Niantic’s partnership with the NBA on NBA-All World, with the augmented reality game connecting ordinary fans who love to play basketball.
Moviegoers could surely have that experience with their favorite stars. Hollywood needs to pay attention to the new crop of entertainment showcases. One of the most anticipated launches is the Las Vegas MSG Sphere, a $2.1 billion hybrid in-person/digital concert and sports venue launching next fall with a run by U2.
Last August, Ticketmaster began allowing venues in its network to sell tickets via blockchain platform the Flow. But this went beyond just attending shows run by Ticketmaster: The NFTs sold via the Flow included celebrity meet-and-greets and the selling of memorabilia.
Of course, merchandising is connected to loyalty, and the nature of loyalty has changed. Web3 is reinventing that concept as well, with the punch cards of yore, in which a retailer would just clip a hole to deliver a discount, largely gone.
Aside from not wanting to carry around a piece of paper, patrons have come to expect more than price breaks, with “loyalty" now centered on online/offline touchpoints. As consumers choose between streaming entertainment on their connected devices, movie theaters need to extend their presence on digital channels to remain relevant.
As blockchain-based digital certificates, digital tokens mark a point of seamless connection and transparency of value. Clarity is what leading movie theater chains need right now, particularly given the social media outcry over tiered seat pricing. Loyalty rewards in the form of digital tokens can help theater operators by stressing the value of being a regular customer who gets a first look at desired screenings.
Sales of NFTs rose 260% to $25 billion from 2020 to 2021, a surge that has cooled. But NFTs themselves aren’t dead, only the short-term, transactional-use cases are gone. Chain establishments including Starbucks have recognized their long-term value by experimenting with blockchain-based rewards.
From gamification to artificial intelligence-based personalization, this is a crucial moment for the entertainment industry to reinvent its loyalty programs. Loyalty aside, movies are naturally immersive. Motion pictures can leverage the metaverse by introducing hybrid digital/physical environments that immerse viewers in their favorite films.
TV screens have clearly gotten larger and sharper, but theaters can use Web3 tech to enhance the big-screen experience in ways that can’t be replicated even in the most spacious living rooms or with the highest TV advancements. That’s how 21st-century moviegoing gets reborn.
Greg Kahn
Emerging Tech Exchange
Founder & CEO
