Future Trends in the Entertainment Industry How NFTs Shape Asian Fan Culture and Business Models

Revolutionizing Asian Fan Culture and Business Models NFTs' Role in Shaping the Future of the Entertainment Industry

The next generation fan culture will begin once the right products are found and the infrastructure is ready for consumer adoption.

Written by: Teng Yan

Entertainment industry will be the next big trend and NFTs will play a key role in it. In Asia alone, this is a $18 billion opportunity. Here are the reasons:

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K-POP is a typical example. K-POP is South Korea’s number one cultural export product, with BTS, a South Korean boy band, earning $5 billion in annual revenue, accounting for 0.3% of South Korea’s GDP;

Asian fans are very passionate. They are willing to support their favorite celebrities (financially) and help them succeed. Fan frenzy is evident in the purchase of large quantities of physical albums and merchandise.

The album sales of only the top 5 K-POP groups have already exceeded $1.5 billion. Fans buy albums to get photo cards, posters, and other memorabilia. Some have a mechanism similar to a gachapon, where ownership can help fans establish a closer connection with their favorite celebrities.

Fan culture is reflected in business indicators: HYBE (BTS management company) had a total revenue of $673 million in 2020, with $276 million from albums (41%) and $219 million from merchandise (32%). Universal Music Group had a total revenue of $8.9 billion in 2020, with only $217 million from merchandise (~2%).

Digital collectibles NFTs will make the next generation fandom possible:

• For example, exclusive token ticket experiences for concert presales, private fan channels, and meeting celebrities.

• Dynamic media can change and evolve based on actions taken.

Fan collectible NFTs can also:

• Serve as a transparent and immutable record of “fandom level”. Everyone can see who the top fans are.

• Have known scarcity (unlike most commodities today).

• Be easily traded on secondary markets.

I have seen NFT startups approaching K-POP in several ways:

1. Collaborating with top K-POP agencies. This makes sense because there are large fan bases waiting to be developed. Examples include Anicube and MOMENTICA.

2. Focusing on second-tier artists and IP. Many talented artists in K-POP do not achieve immense popularity due to the competition, but they still have sizable fan bases and lower risk compared to top IPs.

3. Starting a new entertainment agency from scratch and developing their own content IP. Utilizing NFTs for community co-ownership, nurturing fan ambassadors, and providing novel experiences. This is a challenging path, but the disruptive opportunities are immense.

For example: Modhaus/tripleS official is an agency for a community-driven 24-member KPOP team, where fans can make key decisions. Fans can vote on which member will be in which subunit and which song from their first album will be the title track.

In Korea, you can purchase a random physical TripleS card pack ($0.40) and scan the QR code to link the card to the Cosmo application.

Each physical card is also an NFT and comes with different scarcity and voting rights. They are transferable.

Selling digital fan collectibles as a revenue-generating business model. Another business model is giving away NFTs for free… yes, for free.

Here’s how it works:

Free NFTs as marketing and customer acquisition tools. They can indirectly drive revenue by bringing users into regular revenue streams in the entertainment industry:

• Concert ticket sales;

• Music albums;

• Merchandise sales, etc.

For example: GEMIE, an entertainment-focused metaverse platform supporting virtual concerts. Their VIP passes are Free Mint.

The next generation of fan culture will begin once the right products are found and the infrastructure is ready for consumer adoption. Although it’s not yet the golden age… we’re getting closer.

• Account abstractions;

• Coinbase wallet-as-a-service;

• Easy credit card purchases.

The cultural tipping point will come when:

• Early adopters showcase their favorite digital collectibles within their fan communities;

• Celebrities actively discuss their NFTs on social media.

I predict this wave will start in Asia and then expand to the West. It might take 9-18 months, but it will happen. Once the attention on fan collectible NFTs starts to increase, it can explode rapidly. Remember NBA Top Shot (sports) in 2021?

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