Back in July, when film sales company MPX cut a distribution pact with 1091 Pictures for “Electric Jesus,” a comedy about a never-famous ‘80s teen Christian hair metal band co-starring Brian Baumgartner (NBC’s “The Office”), it negotiated NFT (non-fungible token) and digital collectible rights as part of the deal. Given that NFTs — unique data files (representing photos, audio, video, etc.) that use blockchain technology to provide verifiable proof of ownership — are probably the most talked- about and least understood trend in the worlds of investing, art and technology, it’s reasonable to wonder exactly this means.
So Variety talked to MPX CEO Andrew James Felt, who co-founded the company with senior VP of sales and acquisitions Ryan Bury in late 2019, about how NFTs can be a viable revenue stream for filmmakers and what part they will play in his sales strategy at AFM, where MPX is representing 45 films ranging from the comedy “Faith Based” to the sci fi thriller “Transference: Dark Mutants.”
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Fox is said to be investing $100 million in NFTs, but they’re using them with established IP with a proven, passionate fanbase like “Rick and Morty.” How does it work when you’re dealing with independent films that may not even have a big star?
You have to understand what types of customers are purchasing non-fungible tokens or digital collectibles, what they’re looking for, and whether your IP warrants monetization with this new thing. With “Electric Jesus,” Brian Baumgartner was the No. 1 star on Cameo during the pandemic, is very plugged in to the digital world and also has a legacy nostalgic background from being on “The Office.”
How do buyers react when you mention NFTs?
There are kind of two camps. Either folks are not interested in learning more about what these things are and how they’re going to impact our business, or they see how quickly digital has changed our lives and are bullish to explore more.
Is the market mature enough to use NFTs as a pre-sale component to help finance a film, or is merely another revenue stream for the IP?
It’s structured very much like a merchandizing deal where these digital collectibles can generate new income for a film that wasn’t available before. This idea that NFTs are going to be used to finance feature films, I think that that’s great, but I don’t think that’s really going to be the biggest headline in the future.
Are the NFTs being sold like traditional merch, where the money is made with the initial transaction? Or is this more like an IPO where you’re selling a set number to the public, while holding on to a percentage and hoping their value goes through the roof?
There are a lot of folks taking that IPO approach with what we call one-of-one NFTs with things like the Bored Ape Yacht Club or CryptoKitties. But I think that there’s a much larger market to give actual fans who are not crypto-speculators the opportunity to own a piece of content or a digital item that is associated with IP that they love.
Are NFTs something you’re discussing with buyers at AFM?
We hope we will be talking to all buyers about where they are with NFTs and getting a pulse check, because we do feel like it’s part of our mission to help inform them of where new competitive landscapes will come from. Most of the major streaming companies are not participating in NFTs at this moment, so it is a way for distributors to be competitive. But I think we’ll start to see everyone involved in the future.
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