Virtual Delivery Webinar deck for Create NSW, 15/5/20

Below is a slide deck for the Create NSW panel discussion webinar on Virtual Delivery - Does putting your work online pay?

https://www.brandwatch.com/blog/facebook-statistics/

*https://fortune.com/2018/02/27/youtube-success-poverty-wages/ ; https://www.thestreet.com/personal-finance/what-is-the-federal-poverty-level-14690998

BYP Group blog version: https://www.bypgroup.com/blog/2020/3/26/nerd-immunity-what-the-arts-community-can-learn-from-pioneering-digital-content-nerds-a-strategic-view

Screenhub version: https://www.screenhub.com.au/news-article/features/covid-19/yen-yang/nerd-immunity-can-geeks-save-the-arts-from-covid-19-260112

Aggregation Theory – A theory on the forces at play in the digital arena: https://stratechery.com/concept/aggregation-theory/

Aggregators are at different stages in different industries e.g. music/audio (Spotify vs iTunes), search (Google), online shopping (Amazon), accommodation (AirBnB), rides (Uber vs Lyft)

Go big – Generate a small amount of revenue from a large audience/customer base e.g. Facebook, YouTube

Go niche – Identify a niche in the market at which you are uniquely compelling (Unique Selling Point – USP).

The glut in digital content means non-digitizable and ‘experiential’ e.g. live performances, tangible goods becomes more valuable – but only to some i.e. ‘super fans’.

Nerd business models:

To cut through the noise they have gone niche and they are leveraging the Internet and aggregators to distribute their content and allow audiences to discover them.

Top of their niche: https://critrole.com/

Second in their niche, focusing upon podcasts: https://glasscannonpodcast.com/

A newcomer using more interactivity to drive monetisation: https://www.youtube.com/watch?v=SE88lTM2Dfs

Content differentiation and the subscription model: https://www.patreon.com/mathasgames

Nerd business models:

-Very niche: Nerds playing Dungeons & Dragons: https://critrole.com/

-Low production costs: Borrowed set, skeleton crew. Eventually get more elaborate sets, intro trailer, miniature figurines, etc.

-Leverage their online fanbase through … online donations: Critical Role would break the Kickstarter record for a film or TV series, raising US$11 million from around 88,889 donors.

-Monetise the ‘experiential’ (non-digitizable: During normal times they regularly sold out 4000-seat theatres with the cheapest tickets averaging over US$100. They also have a flourishing merchandise shop, affiliate marketing and sponsored ad-content that they either create for their sponsors or the sponsors have pre-made and slot into their show. This is in addition to any Google AdSense advertising revenue they get from ‘ad-roll’ insertions. Note that in addition to being professional voice actors, they all had considerable theatre and live performance training.

Deeper discussion at https://www.bypgroup.com/blog/uncategorized/the-david-versus-goliath-battle-faced-by-australian-creative-industries-and-what-they-might-do-to-win-part-3-new-media-business-models

Nerd business models:

Second in their niche, focusing upon podcasts: https://glasscannonpodcast.com/

They also do live shows (but they are presently smaller) and sell merchandise, but are also selling subscriptions to more content, similar to what their fans already know and love.

Nerd business models:

A newcomer using more interactivity to drive monetisation: https://www.youtube.com/watch?v=SE88lTM2Dfs

The candles in the background of the left image has candles that get lit when viewers donate money. Viewers can also influence the outcome of the game by providing their heroes with bonuses (a bit like in the Hunger Games), or they can bid against the heroes. Bidding wars often ensue between those in favour and those against. They also use more CGI and started off using elaborate models, props and figurines.

Nerd business models:

Content differentiation and the subscription model: https://www.patreon.com/mathasgames

Clearly there are low barriers to entry to playing games and sticking the videos online. To differentiate, some of these ‘Let’s Players’ provide a more labour-intensive role-playing style, that allows emergent storylines to evolve. Here, the YouTuber, Mathas Games is playing a game called Project Zomboid, in which he roleplays the experiences of his avatar surviving a zombie apocalypse. He successfully raised enough from a Patreon subscription campaign to fund his time and an editor’s time to make a couple of series of this.

The exception that proves the rule: The National Theatre https://onefurther.com/blog/visualised-3-national-theatre-at-home

National Theatre was built with pre-Internet assumptions.

Note: They have significant brand awareness as the premier contemporary English-language theatre company. So one question to ask yourself is: “What area am I the National Theatre in?”.

Note 2: They also achieved this at the peak of the pandemic and early on in the UK lockdown. The material – a light farce to cheer us in our darkest hour – may also have played a role in its relative success.

Note 3: One-off?: Subsequent performances not so strong: Twelfth Night had 839,320 views as at 30/4/20 having premiered on 24/4/20. Timeliness of the first event as the pandemic picked up in the national consciousness was probably critical.

The Orchestra of the Age of Enlightenment (OAE) show off their niche expertise in Baroque instruments.

Note, despite their relative success, they may need a leaner musicians’ roster to ensure costs are kept in line.

The British Museum have multiple items on their playlist. This item is from their ‘Curator’s Corner’ playlist, in which they demonstrate their specialist knowledge in how to make a Celtic torc. Note the potential for higher-value, boutique tours and classes with these curators.

Ben Thompson, the tech analyst that developed Aggregation Theory, is a firm believer in subscription models for digital content, so much so, he runs his own business along precisely these lines, going so far as to keep his content off aggregators of any form: https://stratechery.com/2020/dithering-and-the-open-web/

Thompson’s business model is to sell a technology newsletter subscription. People go to his website to subscribe (monthly or annually) and pay. He then emails them his newsletter. It’s extremely ‘scalable’ (can become very large easily) because the additional cost of sending out another copy of his newsletter is nearly zero.

Definition of a Subscription: https://stratechery.com/2017/the-local-news-business-model/

How Government Investment in the Culture Economy Led to a Billion Dollar Industry

What burgeoning team sport phenomenon awarded over AU$20 million in prize money[1] this past August to a team of 5 players where the youngest broke onto the international competitive scene last year at the tender age of 15, and the oldest is nicknamed ‘Old Man’[2] at a mere 27 years of age? Here are some clues: Its players, bear nicknames like ‘Piglet’, ‘Faker’ and ‘Amazing’, its 119 pound (54kg) stars can mysteriously burn-out[3] at the age of 21[4], and its audience is already measured at 137 million people around the World. [5] Team names include ‘Evil Geniuses’, Cloud9 and fNatic.

I’ll give you just one more clue: The team is made up of what would typically be considered the least athletic people alive – geeks.

By now, most male readers under 30 will know what I’m talking about. The rest of you are probably scratching your head at this perversely inverted world where pimply nerds are sports heroes and worshipped by legions of female fans. [6]

The phenomenon in question is eSports in which computer gamers play against each other, frequently online, and at the elite level, in the flesh at stadiums including the Wembley Arena.[7] The game that awarded over $20 million in prize money is DOTA 2[8], a computer game that allows multiple players to compete online in a virtual battle arena, or a MOBA (Multiplayer Online Battle Arena) for short. DOTA itself is an acronym for ‘Defence of the Ancients’, which is in turn, a spin-off of the extraordinarily popular ‘real-time strategy’ game[9], World of Warcraft 3 published by Blizzard Entertainment. The ‘2’ in Dota 2 refers to the fact that it is the second official version by Valve Corporation which produces and distributes games.[10]

But DOTA 2 is just the tip of the iceberg when it comes to ‘eSports’. Other games commanding multi-million dollar prize pools include League of Legends, Call of Duty and Smite.[11] These are just a few of the video games played competitively, described as ‘massively online battle arena’s’ or MOBA for short.

People from all corners of the ‘connected’ Earth play eSports against each other making it, in some ways, even more international than soccer/football where players are restrained by travel and passports to play against each other. Of course, in the interest of fairness, and to make their competitions a compelling live event, most competitions at the elite level require players to compete at the same venue on the same equipment live before an audience of screaming fans. Nevertheless, the purely online competitive component has its sophisticated leader boards, through which some child star players have emerged like ‘overnight’ sensations.[12]

Its nerdy star players look so much like you would expect a professional video gamer to look, it makes any parent wonder about the future health of their boy– or their girl.[13] Hailing from all the ‘nerd’ classes; pimply, deathly pale, skinny or overweight (but never physically well-developed), bespectacled, greasy-haired, Asian (even 2 of the Canadian DOTA 2 world champions ‘Evil Geniuses’ are of Asian descent) it is perhaps not surprising considering professional teams have coaches and rigorous training regimes,[14] big brand name sponsors,[15] as well as billionaire owners and backers,[16] just like ‘real’ sports teams.

What has this all got to do with the title of this article?

Here’s a hint. The ‘Super Nation’ of eSports is South Korea[17] where the micro-momentary expression of a pro-gamer losing to the upstart wunderkind, Faker, has its own meme page.[18]

In an impressive display of government intervention triumphing over the free market, the Korean government made a conscious decision nearly 20 years ago to promote its ‘soft power’.[19] Frequently the historical whipping boy of its near-Asian neighbours, China and Japan, and with a mere fraction of the people of those populous giants, Korea’s government felt it needed to somehow compete with its historical ‘big brothers’. During this time, not only did it provide universal superfast broadband, but it sponsored the development of its key cultural industries, including film, television, popular music, and of course, gaming. The rest, as they say, is history.

[1]Source: http://www.esportsearnings.com/tournaments/12894-the-international-2015

[2] http://evilgeniuses.gg/Profile/13,Fear/

[3] http://www.kotaku.com.au/2015/02/one-of-league-of-legends-best-players-gets-benched/

[4] http://lol.gamepedia.com/Piglet

[5] https://www.superdataresearch.com/blog/esports-brief/

[6] http://espn.go.com/espn/feature/story/_/id/13035450/league-legends-prodigy-faker-carries-country-shoulders

[7] https://www.google.com.au/search?client=safari&rls=en&q=sse+arena+wembley+wikipedia&ie=UTF-8&oe=UTF-8&gfe_rd=cr&ei=GBgnVozSJdDu8wfqg7gQ

[8] http://www.playdota.com

[9] https://en.wikipedia.org/wiki/Real-time_strategy

[10] The history of how DOTA 2 came to be it itself an interesting illustration of the power of the crowd-sourcing phenomenon, where a fan of the game, known only under the ‘handle’ (alias) of Eul, kicked off a chain of successive iterations by even more fans adept at programming.   Ultimately, Valve commissioned the last in this line of fans, ‘Ice Frog’ to help build their official version of DOTA 2. https://en.wikipedia.org/wiki/Defense_of_the_Ancients#Development ; https://en.wikipedia.org/wiki/Defense_of_the_Ancients#Sequel

[11] http://www.esportsearnings.com/tournaments

[12] https://en.wikipedia.org/wiki/Lee_%22Faker%22_Sang-hyeok

[13] All-female eSports teams exist e.g. Girls HK, Team Siren, and presently, a select few, earn respectable prize money: http://www.kotaku.com.au/2015/08/hong-kong-gets-its-first-all-female-league-of-legends-team/ ; http://team-dignitas.net/articles/blogs/No%20Category/3465/Call-Your-Shot-What-Do-You-Think-Introducing-Team-Siren ; http://www.esportsearnings.com/players/female_players . However, they are still a minority in eSports: http://www.polygon.com/2014/5/27/5723446/women-in-esports-professional-gaming-riot-games-blizzard-starcraft-lol

[14] http://www.liquiddota.com/forum/dota-2-general/462152-coaching-in-esports-a-comprehensive-look

[15] http://fortune.com/2014/07/24/esports-sponsors/

[16] http://dota2.gamepedia.com/Invictus_Gaming

[17]http://www.pcworld.com/article/2036844/why-gamers-in-asia-are-the-worlds-best-esport-athletes.html ;

http://www.nytimes.com/2014/10/20/technology/league-of-legends-south-korea-epicenter-esports.html?_r=0

[18] https://www.facebook.com/H2K-Ryus-face-memes-480179422135007/ . The original expression can be seen at around 13 seconds in at: https://www.youtube.com/watch?v=ZPCfoCVCx3U

[19] http://www.creativetransformations.asia/2014/05/the-k-pop-factory-phenomenon/