The Hard Truth About Creators, Before NFTs
The starving artist trope is a worldwide phenomenon, sweeping through artists and content creators in the form of low compensation and hardly any client prospects. Despite having to do with just about any visual element in the world, artists are often underpaid and undervalued — frequently forcing them to take on other jobs on top of their creative gigs. It’s not just people who draw and paint who have it tough. Even music artists aren’t making much. Millions in streams and playbacks don’t mean much in a world where producers and CEOs still take most of the cut.
However, recently, NFTs, or non-fungible tokens, entered the mainstream market with a vengeance against the underappreciation of artists. More commonly known by his username Beeple, Mike Winkelmann was forced into the limelight after his digital art titled “Crossroads” sold for over $66,000 in late 2020. Flash forward to early 2021, and he’s made another massive sale — this time, a 5000-artwork collage for $69 million. And Crossroads? It was resold for $6.6 million.
Hold up — slow down for a bit. To truly understand how NFTs disrupted the art marketplace, here’s a rundown of the monetization scene before the blockchain-backed innovation swept the art world by storm.
YouTube Built Dreams Through Monetization. And Then Cut Corners.
In 2008, YouTube released a revolutionary monetization program that aimed to help content creators make money through their video-making hobby. At the time, partners were identified through a special “banner” instead of the traditional round profile photo — a trait that meant that their channel was raking in cash through advertising revenue. Out came online celebrities like JuicyStar07, Michelle Phan, and PewDiePie, whose millions of views brought massive advertising revenue to YouTube and whose success turned “YouTuber” into a career path for today’s youth.
It’s hard to brush off the earning potential that the platform offers. Controversial YouTuber Logan Paul reportedly earned $36,000 per monetized video, or over a million a month, through daily vlogs. But churning these numbers isn’t as easy as it sounds. In 2017, YouTube moved to demonetize videos with under 10,000 views and has greatly changed its policies over the years. The barrier of entry is getting increasingly tougher as more people enter the platform in hopes of building a career. For most, a day job is necessary to keep their lives afloat amid the aim to the top.
Patreon Exists But Supporters Do Not
Patreon is a platform where users can support creators who offer packages for each donation milestone. A $5 donation may merit access to the exclusive Patron-only feed. $15 might include a few HD wallpapers per month. $100 might get you a sketch. This system offers huge benefits to artists and an opportunity to earn a regular income outside of inconsistent commissions and client work — but only if they can build a community big enough to keep them afloat.
Data showed that only about 2% of creators on the platform earned enough money to cover the federal minimum wage. While there have been success stories of talented individuals making over $200,000 per year through crowdfunding, there’s a lot of dedication and luck that plays into the equation. They need to churn enough content to keep Patrons happy, which means letting go of a full-time job. Then they need to get enough Patrons interested by building a strong social presence — and that’s all up to lady luck.
Livestreaming: A Hit or Miss
Livestreaming has been one of the internet’s latest obsessions, from Twitch gaming streams to YouTube’s more diverse content portfolio. Streamers can earn through ad revenue, channel membership, and donations from viewers. And there’s big money to be made in this industry. Hololive, a 2D live streaming company, turned Vtubers into a global sensation when it expanded to the US and Indonesia in 2020. Its most profitable idols reportedly make over $10,000 per stream — and most stream daily.
But on the other end of the spectrum, unknown names stream for months with just a handful of viewers. Much like how stardom isn’t a career path simply working hard can achieve, the live streaming gods choose their favorites. A 22-year old gaming streamer named Mocha allegedly died because of poverty while trying to build his channel to make a living. The same narrative weaves itself across the internet.
How NFTs Bring Justice to Creators
Beeple’s story is an outlier that screams astronomical success. Most creators don’t make $69 million on an average NFT, but what matters is that the technology exists for artists to finally monetize their work on fair terms. Non-fungible tokens grant immutable ownership to digital files and assets. These can include memes — breaking news: the iconic Nyan cat sold for almost $500,000 — and gifs, videos, and art. Their value is inherently unique to each asset, which means that there is no “standard price” that states that an artwork must only cost $20. Like fine art auctions, the artist dictates the starting price and chooses the selling method and terms.
NFTs have empowered artists from all over the globe and continue to do so daily. Successful artists make six figures selling NFTs, citing royalties as critical pillars in the monetization process (all you have to do is tick a box to earn royalties). Minting an NFT requires no programming skills — marketplaces like OpenSea do it all for you; all you need to do is click create.
While the NFT boom certainly favors some artists over others, it’s important to understand that its successful integration into the consumer goods market ensures higher job prospects for creators. Who needs to deal with $10/hour freelance work that comes once in three months when you can score a job rendering 3D garments for Gucci? Gamers, streamers, and developers also have a place in this new market, as ESPA fosters a 360-degree monetization model starting from NFT integration.
There’s still progress to be made for NFTs to truly breach the mainstream market — which still needs to open up to the digitally-driven economy — but it’s already made huge progress by creating a lifeline for struggling artists. What’s next is engraving speculation into both physical and virtual realities.
