Everything about Hollywood is diametrically opposed to web3. Centralized power and profit, exclusive and expensive, with entertainment lining the pockets of execs. Sasha Mitchell, who was head of 3-D capture at Walt Disney Studios, Warner Brothers, Universal Pictures and Netflix, learned just how few rights actors have – even the A-listers. 

Mitchell’s job was to digitize performers, sets and props for use with visual effects. They turned the actors into 3-D avatars, using photogrammetry and LiDAR scanning. He had one “very famous” actor who perceived digitalization as “taking his soul” while others were excited about it – asking for a copy of their avatar, only to be disappointed when told the studio owned it. 

The issue that arises is that if a studio has a library of 3-D avatars of the actors, they could all be used in the future without needing to hire them again. 

As AI entered mainstream consciousness, Mitchell observed anxiety worsening, as actors became concerned with how and where their digital likeness could be used – like we’ve seen most recently with Scarlett Johansson, claiming Open AI trained ChatGPT-4o on her voice. 

This interest in actor’s rights led Mitchell down the proverbial rabbit hole of blockchain technology. 

In doing so, he noticed two main problems with centralized entertainment – license servers and contracts. Licensed servers centralize control for all the intellectual property online. 

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“Much the same as having a home, the way you monetize it first is being able to protect it,” Mitchell said to me in a recent interview. “Your home is private property but if you want to monetize it, you can rent it out or use AirBnb. There is no difference online. As the world gets increasingly more digitized, we all must recognize we have private property.” 

What’s happening now is everyone’s having their private property managed by someone else, with exorbitant fees and convoluted contracts. 

Mitchell sees a world where actors and artists can encrypt their own data, monetize it directly and get paid instantly, rather than waiting a couple of months for a royalty payment. Or for creators and filmmakers to go to a marketplace and find the AI version of actors, directors and extras where rights are upheld and everyone involved is compensated. 

Blockchain technology, Mitchell believes, is the golden ticket. You can offset all the costs of licensed servers with smart contracts, he said. 

Elacity, Mitchell’s decentralized digital rights management system (dDRM) allows individuals to monetize their work, without the gatekeepers, and create an economy around it. 

“You encrypt an asset – music, a video, a podcast, a game or even software – and distribute access tokens with embedded rights,” he said. “When a purchase is made, the people who are responsible for creating the asset such as the filmmaker, investor, publisher and lawyer, are all paid out every time.”

He also envisions a secondary market. “As a creator, you can choose between allowing a user just to buy from you or you can make an option where they can resell it on,” Mitchell said. “The user might get 60 percent of the fee for reselling it and the remaining 40 percent is sent to all the original royalty token holders.”

The Blockbuster vs. Netflix analogy 

Mitchell likes to tell the story of Blockbuster vs. Netflix. “For Blockbuster, their biggest asset was their shops all across the world,” he said. “They had the distribution. You couldn’t overtake them because they were everywhere. When Netflix got to the point in which bandwidth became good enough to stream a video, the distribution completely changed.

“What was once Blockbuster’s advantage became their biggest liability, because they had to cover all the operational costs. I strongly believe the biggest liability is going to be the management of everyone’s identities. Right now, it’s a great asset, but when people start to monetize it directly with the world, it becomes an operational cost.” 

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Intellectual property as it pertains to the entertainment industry is a mess, said Jason Zhao, co-founder of Story Protocol, a programmable intellectual property layer enabling seamless provenance tracking, licensing and revenue sharing.

“IP is still trapped in the medieval age – with mountains of paperwork and lawyers, making it inaccessible to creators,” he said in an interview. “By making IP programmable, it becomes human and machine-readable, allowing creators and artists to easily set the usage and attribution terms for their creations. By bringing IP onchain, creators and developers can track the attribution and provenance of their IP while simultaneously contributing to existing projects, co-creating new assets, and remixing other IPs across the network.”

By allowing creators to seamlessly share their IP rights with their community, their creative work can harness the creativity and network effects of the Internet, he added. 

“The only drawback is that it didn't happen sooner,” Zhao said.

lead image: Sasha Mitchell