Call it what you will, but clearly the entertainment landscape is experiencing an earthquake. Say hello to the new Hollywood. None of this happened in a vacuum. Studios, so long stuck in silos, are in a showdown with streaming platforms fighting for vertical integration. The marketplace is forcing the old guard to play catch-up. We are seeing the adding, removing, restructuring and combining of companies and studios to amass subscribers and cater to a new generation of consumers who are driving the democratization of everything.
One upshot here is that a new phenomenon is emerging: the creator economy. For centuries, artists created art and the money earned went largely to someone else. Writers wrote, painters painted, singers sang, while book publishers, art galleries and music labels profited, sometimes courtesy of agents and managers committing fraud, theft and other felonies. Someone else always ran the show.
In the creator economy, artists are equipped as never before to mint, own, market and merchandise everything they create. They are assuming control directly over consumers to meet public demand, with ironclad security in place, and monetizing at every step. Former outsiders are now insiders, with commercial ecosystems building around them.
Within the next few years, the creator economy will grow exponentially based upon Generation Z’s coming of age and advances in technology. Here are the six converging forces that are behind this phenomenon.
- Meta technology. It’s all advancing at warp speed — AI, blockchain, XR, advanced analytics, you name it. New social media platforms are launching features ranging from live and video streaming to audio chat capabilities, all with monetization and brand integration. Watch out for the metaverse, too, where entire virtual infrastructures will enable creativity and commerce. And once 5G is fully deployed – by 2025 an estimated 1.7 billion people will have its services, with buffering and such glitches doomed to be no more – it will propel everything creative forward even faster. The tools of technology will put even more control and power into the hands of creators. Creators will become self-sufficient, studios unto themselves.
- Mass adoption driven by the coronavirus pandemic. Yes, let’s give credit where credit is due. A single nasty pathogen has expanded and accelerated the digital transformations in the entertainment industry already years in the making. Everything happening now was going to happen sooner or later, but instead it’s happened much sooner. Consumers who otherwise would have taken years to convert to digital have adopted en masse.
- Generation Z. Born between 1997 and 2012 and weaned on life lived virtually, they only now are coming of age as teenagers and young adults. They are huge clout chasers who transact virtually — content, music, merch, games. As such, they are as responsible as any other consumer segment for driving the demand for multiple screens and immersive experiences.
- The new influencers. Suddenly, thanks to social media, everyone is a potential influencer. Big-time critics — of movies, of television, of music — matter less and less every year. We’re all now entitled to play expert and influence others to do what we do. Nobody needs permission from a gatekeeper to speak up. Audiences hold the reins, and brands are reacting and buying that influence like never before.
- The growing premium on authenticity. Streamers, craving the new, are ever-more focused on discovering, producing and distributing original stories. As a result, the entertainment industry as a whole is increasingly going grassroots, meeting creators where they live. Historically marginalized groups are creating a new Hollywood, all while owning their own content and brands.
- Curating freestanding communities. Creators now have the tools to securely distribute content to communities they themselves have established and curated. And thanks to advances in blockchain, they can be forever connected to whatever they create, all while receiving royalties as it’s sold and shared. It’s equivalent to self-publishing a book. Artists are raising capital and converting themselves from employees to entrepreneurs — to be the CEO.
So welcome. The new Hollywood is tech-savvy, diverse, multiscreened, nostalgic and intergenerational, complete with brands and experiences that are vertically integrated. What we’re witnessing now is studios and content creators jockeying for position, on an unprecedented scale, to gain leverage over each other. This shift will fulfill the promises that early advocates of the World Wide Web once predicted — that access to the internet would democratize life as we know it.
Entire industries — video game makers, book and magazine publishers, theater and movie production companies — are moving toward decentralization. Mass innovation is leveling the playing field once and for all. Free enterprise is truly free.
The companies that get behind the creator economy will have a decisive competitive advantage. Those that do otherwise will simply be left behind.