Andy! It’s your old law school pal Ben Elkin. Hope you’re well. Trying to get in touch with you. You seem to have a new number. I have the same number. Drop me a line. Wanna talk some business with you. :-)
Even though "royalties" for NFTs and IP are both referred to as "royalties", what do you think about the differences in their implementation? For NFTs you earn "royalties" from NFT transactions (the same NFT can't be "used" by multiple people at the same time) while for IP you earn "royalties" for their usage (many people can "use" IP at the same time).
These seem like pretty fundamental differences. One of them profits off of churn while the other profits off of usage.
Cole, great observation. It's a win win for creators, especially if the NFT doesn't come with a right to the underlying IP (which most don't). Do you think they cannibalize each other over time?
Can you elaborate on why it's a win win for creators?
I think sometimes it's worse for creators. Taking books as an example, creators are better off selling the book IP to many people at once and earning the corresponding royalties than selling it to a single person and relying on transactions to make money from royalties.
Transaction royalties aligns the creator's interests with maximizing the rate of churn, while "minting" royalties aligns the creator's interests with maximizing usage.
What do you mean by "Do you think they cannibalize each other over time?"?
Win-win in the sense that creators don't have to chose one over the other, they can do both. Assuming the creator maintains the underlying IP (which most do), they can continue collecting royalties from secondary trading (churn), and pursue licensing deals for the underlying IP.
Andy! It’s your old law school pal Ben Elkin. Hope you’re well. Trying to get in touch with you. You seem to have a new number. I have the same number. Drop me a line. Wanna talk some business with you. :-)
Even though "royalties" for NFTs and IP are both referred to as "royalties", what do you think about the differences in their implementation? For NFTs you earn "royalties" from NFT transactions (the same NFT can't be "used" by multiple people at the same time) while for IP you earn "royalties" for their usage (many people can "use" IP at the same time).
These seem like pretty fundamental differences. One of them profits off of churn while the other profits off of usage.
Cole, great observation. It's a win win for creators, especially if the NFT doesn't come with a right to the underlying IP (which most don't). Do you think they cannibalize each other over time?
Can you elaborate on why it's a win win for creators?
I think sometimes it's worse for creators. Taking books as an example, creators are better off selling the book IP to many people at once and earning the corresponding royalties than selling it to a single person and relying on transactions to make money from royalties.
Transaction royalties aligns the creator's interests with maximizing the rate of churn, while "minting" royalties aligns the creator's interests with maximizing usage.
What do you mean by "Do you think they cannibalize each other over time?"?
Win-win in the sense that creators don't have to chose one over the other, they can do both. Assuming the creator maintains the underlying IP (which most do), they can continue collecting royalties from secondary trading (churn), and pursue licensing deals for the underlying IP.
Ah sweet yea makes sense to do both 👍
I wrote a related post with thoughts on the next chapter of tokenizing communities: https://colekillian.com/posts/on-membership-communities/ :)