Seth Shapiro\'s Business Innovation Blog

The internet has always held a lot of promise for creators. It hasn’t always delivered.

In a creator’s utopia, they would have unmediated access to their audience — no red tape, no gatekeepers, devoted audiences, and the ability to make a sustainable living from their art. Instead, things got complicated and the creator economy made an enormous promise that it’s only fulfilled in certain cases.

Some creators hit the jackpot — a combination of timing, luck, talent, and being on the right platform at the right time. But not every willing artist has found a sustainable business as an online creator — there hasn’t been an even distribution of fandom and success.

The good news is that we’re getting a do-over.

Momentum is swinging back in favor of creators (and their fans), due in part to fan support-driven platforms like Patreon and, well, NFT marketplaces.

NFTs might seem revolutionary, and technologically speaking they are, but they’re part of the creator and fan economy continuum. You might even say they harken back to the dawn of the internet and the promise of having access to the right group of fans.

Back to the Future

In his classic 2008 essay “1000 True Fans,” Kevin Kelly predicted that the internet would shift the paradigm of the creator economy:

To be a successful creator you don’t need millions. You don’t need millions of dollars or millions of customers, millions of clients or millions of fans. To make a living as a craftsperson, photographer, musician, designer, author, animator, app maker, entrepreneur, or inventor you need only thousands of true fans.

A true fan is defined as a fan that will buy anything you produce. These diehard fans will drive 200 miles to see you sing; they will buy the hardback and paperback and audible versions of your book; they will purchase your next figurine sight unseen; they will pay for the “best-of” DVD version of your free youtube channel; they will come to your chef’s table once a month. If you have roughly a thousand true fans like this (also known as super fans), you can make a living — if you are content to make a living but not a fortune.

Kelly envisioned a world where anyone with talent and an internet connection could achieve financial independence, no matter how many creators might be competing for attention, support, and funds. As we mentioned earlier, that vision didn’t come true for everyone. But now, NFTs are poised to play a part in fulfilling the original promise of the creator internet: a marketplace where creators can connect with users in a new, unique, and meaningful way.

Fun fact: we named Artaku by combining the words Art and Otaku, a Japanese term for superfans reflecting powerful relationships between artists and fans.

NFTs can be a dream come true for fine artists, indie musicians, A-list celebrities, and all the creators in between. But what about the fans?

Turning Fans Into Owners

Traditionally, the only ways to engage with a favorite creator are by buying their products (that anyone else can buy) or consuming their content (that anyone else can consume). The recent NFT craze, however, reveals something fundamental about human psychology: we don’t want to merely consume things from creators — we want to own them. Objects have meaning to us, especially if they’re associated with a favorite artist or public figure.

If you’re truly obsessed with something — a movie, a meme, an athlete — you want a slice of its legacy that nobody else or few others have. NFTs deliver on that desire by legitimizing a piece of social currency. Much like a Boomer might want to flaunt a bottle of 1958 Domaine de la Romanee-Conti, a Gen Zer would rather claim exclusive ownership of a clip from their favorite YouTuber. Even better — a clip that’s artistically presented in a new way, perhaps packaged with physical items and unlocking unique or exclusive new experiences.

Watching a new wave of connections form between creators and fans is exhilarating. But how do we make sure the NFT marketplace doesn’t become a blockchain playground reserved for the ultra-wealthy or the crypto-savvy? We can’t all afford a $69 million-dollar Beeple. Far from it.

NFTs Can Democratize Art, But Who Will Democratize NFTs?

NFTs are exploding in popularity, but potential buyers can be deterred by cumbersome user interfaces or undecipherable crypto jargon. Whether you’re a consumer or a creator, you shouldn’t need tech support to tap into this digitized creator economy. Not to mention that buyers should be able to purchase an NFT with similar pricing to most consumer products, which will become more commonplace as the extremes of NFT 1.0 level off.

One of the principles Artaku is founded on is accessibility. Yes, NFTs are one piece of the continued democratization of the creator economy, but in order to accomplish that, platforms must be easy to engage with. As easy as entering a credit card number on any e-commerce platform — a priority for us at Artaku.

Beeple’s $69 million NFT may have been a global sensation, but such a lofty transaction is unrealistic for mainstream artists and consumers. Artaku is focused on attainable, meaningful digital collectibles that form an unobstructed connection — and business interaction — between fans and the artists they love, whether through art, music, sports, entertainment, and beyond.

You know, the way the creator economy was supposed to be.

When Henry Ford put the world on wheels with the Ford Model T in 1908, he had no clue that cars would become one of the primary causes of global warming. Likewise, when the plastic drinking straw was invented, nobody predicted that they would be ingested by marine wildlife.

When you’re in the early stages of bringing an idea to life, you have to think in terms of days, not decades — especially when you’re ushering in a massive technological breakthrough. Such is the case with the NFT boom we’re witnessing now. Beneath the unbridled optimism lies a serious issue: the ecological impact of NFT transactions, most of which reside on the Ethereum blockchain.

As NFTs, and cryptocurrency itself, become more popular the issue of Ethereum’s carbon footprint becomes more pressing. We receive questions on the topic regularly, so we wanted to share this explainer. In short, we need to ensure that NFT transactions are sustainable, smart, and scalable. But let’s start by understanding the terrain.

NFT Transaction Costs in Perspective

Cryptocurrencies like Bitcoin and Ethereum, the blockchain on which most NFTs reside, burn exorbitant amounts of electricity — so much so that China’s Inner Mongolia, one of the nation’s mining hotspots, has outlawed cryptomining.

The massive energy expenditure is the result of millions of machines furiously competing to “find the hash” for the previous block, and thus get the Ethereum coin rewards for the current block. This is called Proof of Work (PoW). You can think of it like scavenging for Willy Wonka’s Golden Ticket in each block: remember the girl whose father made his factory staff search for a ticket? More people opening more Wonka Bars equates to more electricity consumed.

Every transfer of a token on the blockchain requires a specific amount of computing power. For example, an Ethereum transaction uses about 35kWk, the equivalent of three days of an average American’s electricity consumption and about 600x more than an hour of streaming Netflix.

These statistics paint a bleak picture, but is there more to the story?

A Big Problem or a Big Misunderstanding?

Proponents of PoW have made the case that the Ethereum network has a fixed energy consumption, meaning the surge in NFT transactions doesn’t make Ethereum’s carbon footprint any larger.

A common analogy is to think of the Ethereum network like a train set to cruise control: no matter how many people (cryptominers) board the train, it chugs along at the same speed.

This thought experiment is appealing, but misleading. The reality is that millions of people are on a train that’s polluting the environment. Whether you and I are on it or not, the damage is being done.

We need an alternative transportation method to the metaphorical train. Can the same ingenuity that brought us to this point get us out of it?

Paving the Path for an Eco-Friendly NFT Industry

Some NFT platforms are attempting to offset the carbon cost of transactions by donating to carbon capture projects or by investing in wind farms around the world. These initiatives are admirable, but they dance around the most logical solution: migrating to an energy-efficient blockchain.

That’s where the Binance Smart Chain (BSC) comes in: the blockchain on which the Artaku NFT platform sits. BSC is a “fork” or modification of Ethereum. Instead of relying on Proof of Work, BSC uses Proof of Stake, a system which gives mining power based on the percentage of coins held by a miner.

Remember how Proof of Work requires millions of machines (and burns gobs of electricity in the process)? Proof of Stake only uses 21 computers to validate transactions. This streamlined process results in a much smaller carbon footprint, and reduces gas fees (that can make minting an NFT unreasonably expensive) to just a few cents per transaction.

Achieving true carbon neutrality in the crypto world is an ongoing, complex conversation — at least right now. But that’s no reason to prioritize speed or profits over the long-term health of our planet. The auto industry waited decades to make eco-conscious decisions. Fortunately, we have the data and resources to leave a different legacy.

A quick mobile search for “NFT” turns up hundreds of thumb-stopping headlines.

A highlight of a LeBron James dunk sold for $208,000. The artist Grimes garnered nearly $6 million for a series of digital art. Jack Dorsey auctioned the first-ever tweet for $2.9 million.

NFTs are turning every type of art — from fine art to music to anime — into an asset that can be bought and resold for big returns. That’s particularly exciting for the reseller, but what about fans who just want to dip their toe in collecting work by their favorite artists?

Diving into the pool of NFTs is tempting. Obviously, we think you should go for it. But before spending a dime, it’s crucial to understand how to protect yourself and have a great experience as a collector and newly-minted (no pun intended) player in blockchain and digital currency.

We know you don’t have a ton of time for research. So we broke it down into four questions that aspiring collectors should ask.

1. Who owns the keys?

There’s a common saying in the world of cryptocurrency: Not your keys, not your coin.

There are two kinds of NFT platforms — custodial and non-custodial. We know that sounds a bit dry, but stay with us for a minute. Custodial means that a collector purchases the NFT, but it remains stored on that platform. Non-custodial, on the other hand, means the consumer has full possession and control of that collectible in a digital wallet.

In that digital wallet are the “keys” — a blockchain password that identifies someone as the sole owner of an NFT. With permanent and sole access to the keys through a digital wallet, that collector can admire, trade, or sell their artifact at any time. They are also a lot less likely to lose a collectible in a (god forbid, but unfortunately it does happen) platform hack.

At Artaku, we believe you should have access to the keys. It should come as no surprise that our platform is built using the non-custodial Artaku Mobile Wallet.

We understand that collectors are likely to try out different platforms, depending on their fandom interests, based on where the NFTs are available. If you’re one of them, be sure to know where the platforms stand on NFT custody, and establish a comfort level with their approach.

2. Is understanding ERC-721, ERC-1155, or MetaMask required?

Don’t understand what we mean? That’s the point.

Being an NFT collector, or a fan who dabbles in NFTs, shouldn’t require you to understand that sentence.

Many NFT marketplaces and platforms were built by crypto people, for crypto people. We know — we have many crypto people in our ranks. But the blockchain / digital currency world is evolving to be mainstream and user-friendly.

We want to make it even more user-friendly. You don’t have to understand adaptive bitrate streaming technology to watch Netflix, and you shouldn’t have to be a blockchain expert to buy and sell NFTs. Artaku lets users sidestep crypto jargon with a simple mobile wallet, eliminating the need for complex setup processes, Chrome extensions, dapp stores, and other devices.

We also want to help collectors understand more about the space — from the pros and cons of coin ecosystems to environmentally responsible approaches to NFTs.

3. How are transactions handled?

NFTs are poised to shift the paradigm of ecommerce, but we’re not quite there yet. Do you have to be a seasoned cryptocurrency trader to buy NFTs?

In most cases, no. For example, Artaku users will be able to make purchases using debit and credit cards, or USDC stablecoins for the more digital currency-inclined.

Keep in mind that there is complicated back-end infrastructure to the NFT platform business — to do it right requires a whole bunch of things you’ve probably never thought of, such as access to money transmitter licenses and a payment infrastructure that is flexible and compliant.

Speaking of compliance, the savvy collector should confirm that their platform(s) of choice follow the most stringent of Know Your Customer and Anti-Money Laundering measures. In a nutshell, that means verifying customers’ identities to prevent fraud and other bad-faith actions.

On that note…

4. Is the platform serious about security?

Whether you’re collecting wine, physical art objects, or NFTs, it’s important to know you’re engaging with entities following strict security, regulatory compliance, and anti-fraud measures.

With digital collectibles, look for platforms and marketplaces that offer state-of-the-art fraud scrubbing. The purpose is to automatically detect and stop risky transactions to ensure the authenticity of buyers and sellers, and we’re committed to those efforts here at Artaku. Scrubbing tools can verify IP addresses, match IP geolocation with billing addresses, and block blacklisted IPs — all in real time. They also scan for blacklisted or flagged credit card numbers.

This is where the Know Your Customer and Anti-Money Laundering steps come in once again. Know Your Customer is a bit like sending proof-of-life to prove you’re real and legitimate. These measures are required for compliance, and they help protect the platforms themselves, the brands and artists they engage with, and the collector.

Watch this space for further updates from us. In the meantime, our overall advice is to:

Study before you shop

NFTs are rapidly breaking down barriers in collectible ownership and redefining what it means to be a fan. We think it’s very exciting, and we hope you do too. But all the buzz can create as much confusion as enthusiasm. Before you make a big move, do your due diligence. Being a savvy NFT collector depends on it.

Let’s say you have a streaming stack of HBO Now, Hulu, Netflix, Amazon Prime Video, and Sling TV. At their lowest subscription levels, that will cost you about $64.00 a month. When you add on broadband access, which costs on average $52 per month, according to Kagan, you’re already at $114.

$64 + $52 = $114/month on average!

According to the Leichtman Research Group, the average cost for pay-TV service in 2016 was $103 per month. While streamers no doubt have access to more content than ever, the question remains whether the current à la carte streaming era is actually better for consumers.

With more streaming services entering the market in the next few years, you wonder when consumers will start feeling subscription overload. If cord-cutting was originally driven by cost, it no longer seems to be the main benefit to doing so.

There are other benefits of course—more content, choice, and freedom. But with it comes confusion, gaps in programming, and frustration in finding the shows you want to watch when you want to watch them. The more you think about it, is it worth the high price?

When Netflix subscribers were hit with promos that played in between episodes of the series they were watching, the reaction was harsh and swift.

CEO Reed Hastings has sworn the streaming giant will never run ads or enter the live-streaming or sports arenas. However, the company has been testing promos that play in between episodes of a series, displacing previews for the next episode.

And it’s not only promos that are creeping into streamers’ screens. YouTube recently announced that all creators in their YouTube Partner program can now turn on non-skippable ads for their videos.

Amazon is also launching a free, ad-supported service for its Fire TV customers. They also announced that Twitch Prime members will no longer get ad-free viewing and will have to upgrade to their $9.99 per month turbo level to do so.

It’s an open question whether the ad-free paradise streaming video promised will become a reality. Most streaming companies are running at a loss, and many of them are owned by a parent company that has so far given their subsidiaries a long leash. For example, YouTube is owned by Google, DirectTV Now is owned by AT&T, Sling TV is owned by Dish Network, and Hulu will soon be owned by Disney. Turning these streaming services into profitable business will be no small task, with most of them betting on economies of scale or the traditional TV ad model failing to reach profitability. No matter, it will take years to sort out and it seems as though ads will always be part of the streaming experience in order for SVOD services to reach profitability.


SEPT 3RD–5TH 2018

Congratulations to Seth Shapiro, Liam Robertson, Richard Simpson, and the entire AlphaNetworks team on their ‘Best ICO Pitch Award’ WIN at the World Blockchain Forum, London!

Visionary leaders, economic pioneers, and enterprising investors from around the world gather to discuss the future of our financial world at Keynote’s biggest blockchain industry influencer event – World Blockchain Forum London.

World Blockchain Forum events are the lynchpin between industry and enterprise in the blockchain space; take part in leading-edge discussions to help shape the future of blockchain. World-class experts share their insights into the perils, pitfalls and promise of blockchain as it emerges onto the wider global stage. This year, WBF London focuses on the future of ICOs and delves deeper into the emergence of STOs (security token offerings).

With two days of speaker presentations, project exhibitions and discussion panels, WBF: London is set to further shape the future of Blockchain technology and its impact across all industries.

Seth Shapiro, will present the world’s first AI- and token-driven entertainment platform to combine on-demand videos, advertising and pay-per-view business models onto one solid network. Shapiro has assembled a world-class team of experts in blockchain, media and technology, who together are creating a new infrastructure for the next era of media.

September 11, 2018 at 1:00pm
Keynote: Prospect of Future Consumer Behavior and Music-Related Transactions that Technical Innovation Will Bring. Moderated by Se-hwang Kim
Location: 267, Seongam-ro, Mapo-gu, Seoul, Republic of Korea (03925)

The New York Times reported on these diaries, noting that one participant, Dennis Cheatham, reported having no room to log the time his family spent watching Netflix, “I just kind of shoved it in there and wrote Netflix wherever I could.”

To be fair, paper diaries aren’t the only way Nielsen generates TV ratings. They also use Nielsen meters, which are attached to participant’s cable boxes.

Nielsen counts the number of people in the prized 18-49 demo who watch TV ads live, up three days after air (C3), and up to seven days after air (C7). The viewers for C3 and C7 aren’t valued nearly as much as live viewers but are included to capture DVR viewings.

Yet even with meters, it’s difficult to know if a viewer is truly engaged with what they’re watching. For example, Nielsen may know what channel a cable box is tuned to, but they can’t determine if the viewer’s television is actually on.

Even worse, Poynter has reported research that shows Nielsen still doesn’t get enough data points to have a representative sample, even as they’ve increased their sample size to 40,000 households — and the data they do get has in increasingly high error rate. Nielsen has also had to reveal to their biggest customers, the big TV networks, that they had been giving them inaccurate ratings for a 7 month period in 2014, raising questions as to how long these inaccuracies have plagued the company.

It’s easy to see why the networks, who pay $100 million annually for Nielsen’s services, are frustrated not only with declining ratings across the board, but with Nielsen’s failure to keep up with the changing media landscape. One begins to wonder how a 94-year-old legacy could possibly be up to the task of measuring viewer engagement in an increasingly fractured media landscape.

In Neilsen’s Wake Comes Metrics For All

With the rise of Over-The-Top (OTP) streaming video, like Netflix and Hulu, Nielsen has been trying to play catch-up with a data collection strategy fitted for the 1950s, as 30% of Nielsen’s data is still collected from the aforementioned diary entries.

Because they largely haven’t been up to the task, media companies have been left to their own devices to develop the means to measure their audiences. As a result, we have a mess of metrics and no way to measure apples to apples. The colossus in video streaming, Netflix, doesn’t even publicly release their data to advertisers or content creators, creating something of a “black box” informational advantage.

Social media platforms have attempted to measure their streaming audiences, with mixed results. Facebook counts video views starting at three seconds. They’ve run into their own issues, admitting they overestimated the average viewing time for video views for two years. Snapchat counts views as soon as a video starts, and YouTube does so at around 30 seconds.

YouTube has also been dealing with an “Adpocalypse,” with major advertisers like Coca-Cola, AT&T, and General Motors pulling ads after finding they were being played before offensive videos containing hate speech. In response, YouTube instituted a broad demonetization policy for videos containing advertiser unfriendly content, causing an uproar among legitimate creators, some of whom reported losing half of their incomes in the aftermath.

Twitter’s recent foray into live NFL broadcasts wasn’t the boon in engagement they hoped it would be. They reported a Thursday night game had an average minute audience of 327,000 viewers, while on CBS and NFL Network it was 17.5 million.

With all these media giants developing their own proprietary metrics as an alternative to Nielsen ratings, the future of TV audience measurement is more uncertain than it’s ever been, leaving advertisers to wonder what they’re really paying for.

For decades, Nielsen was able to present an apples to apples comparison of audiences across television that both advertisers and networks swore by. Because Nielsen hasn’t been able to catch up with the demands of audience measurement in the 21st century, the industry won’t have a way to compare audiences—it will inevitably being comparing apples to oranges, with each entity creating their own metrics for their advertisers.

Remember, Nielsen is a 94-year-old company that has had a virtual monopoly in an industry largely unchanged since the 1950s. They built their model in an era where the family gathered around the TV set every night to watch one of the three big networks. That era is completely irrelevant today.

With people able to watch their favorite programs on streaming platforms on their phones or laptops, TV ratings across the board have been shrinking, even typically dependable live sports programming. In turn, networks are facing shrinking ad buys because Nielsen is reporting smaller ratings as the media landscape fractures. Yet it stands to reason people are watching more video content than ever, the problem remains Nielsen isn’t able to measure viewers effectively.

Not that they haven’t tried. For example, Niesen has starting to track different devices like PCs, but they use a representative panel that is too small to measure today’s fragmented audiences. They’ve also developed software to measure mobile and tablet devices, but industry executives complain that it’s filled with bugs.

As another example, Nielsen has attempted to break Netflix’s analytics black box, but the results have been less than stellar, to put it nicely. Their method monitors audio when participants are watching Netflix via their TV’s set-top box, which is based on a similar method used in Nielsen’s radio days. The first issue with this methodology is that it is opt-in, which pretty much guarantees a selection bias in their sample. Second, their method doesn’t measure the viewing habits of any Netflix subscribers who watch on their phones or tablets, which represents two-thirds of Netflix’s customers!

All the while, Nielsen is faced with a more nuanced task—keeping their customers, namely TV networks—happy. The TV industry would be thrilled if Nielsen came up with an efficacious way to measure today’s media consumer, but if that means those numbers aren’t going to increase their advertising sales, they might as well forget it. By having to serve two masters, Nielsen finds itself in an unresolvable conflict.

A New Paradigm For Media in the 21st Century

To change a broken system, you have to reform it from within or create a new one so great that the old players can’t ignore it. AlphaNetworks has chosen the latter.

AlphaNetworks solves TV’s audience measurement problem by using the blockchain to irreversibly record all engagements between users and content.

We’ve developed a “Proof of Engagement” (PoE) algorithm, that will create the foundation for the most efficient and transparent payment and reporting system the media business has seen to date.

Here’s how it works.

Proof of Engagement is a data point that establishes that an interaction between a user and some video content has taken place.

These interactions can be any of the following:

  1. Viewing a video for N seconds
  2. Clicking on an in-video advertisement
  3. Finishing an in-video activity, such as a questionnaire

Engagement is established on AlphaNetworks servers with proof of the engagement being anchored on the blockchain. This means every act of consumption is verifiably recorded, with the resulting actionable data transparently supplied to participating networks, creators, and advertisers.

Of course, all viewer data is fully anonymized and analytics are completely segregated from viewers’ personal info.

This replaces the old and inefficient model used by legacy companies like Nielsen to measure audiences, and allows for a new economic model for creators, advertisers, and networks to form.

Rights holders will receive direct payouts based on consumption using PoE, as well as transparent access to a robust dashboard of analytics.

Users can spend directly on the platform on a variety of goods and services directly from the user interface.

And advertisers will get invaluable insights from Watson AI’s predictive analytics, automatic visualizations and customizable dashboards.

AlphaNetworks’ anonymized Proof of Engagement (PoE) is a highly accurate, transparent method for measuring engagement within the Alpha Networks ecosystem. It provides a true apples to apples metric for media consumption in the 21st century. The PoE approach ensures timely transactions to all participants—including content creators, users and advertisers — throughout the AlphaNetworks ecosystem.

“How do we define what makes a leader cool?” “Why do some celebrities appear to effortlessly embody what is chic and impressive?” Rapper and media personality LL Cool J has produced a show on MSNBC to answer these very questions. The show has authorities in politics, media, history, and art discussing what it means to be “cool” in America.

The three-part docu-series aired on July 1st, 2018 and continues in reruns. Seth Shapiro spoke about the historic change that television has created in American’s views of presidents and their personalities. Shapiro was part of the discussion around three presidents identified as cool: John Kennedy, Ronald Reagan, and Barack Obama.

Shapiro explained how television affected how the American public saw President Kennedy. One of the key factors Mr. Shapiro identified was the ability of President Kennedy’s father to see the importance of media in influencing public perception. Shapiro offered his opinion that the Kennedy family was able to become prominent, in part, by being an early adopter of the power of television.

TELEVISION: Innovation, Disruption, and the World’s Most Powerful Medium

Seth Shapiro has well established himself as an expert in television’s history and influence on society. He is a two-time Emmy winner, an Adjunct Professor at the USC School of Cinematic Arts, and has been the Governor of the Television Academy, as well as a member of their executive board. His first book “TELEVISION: Innovation, Disruption, and the World’s Most Powerful Medium” was a bestseller on Amazon.

Mr. Shapiro’s television and media expertise has most recently helped guide him and his team of content, blockchain, and digital media experts, as they create AlphaNetworks, a revolution in media that uses blockchain and token technology to create a data-driven video platform with incentivized gamification for viewers, influencers, content owners, and independent creators.

AlphaNetworks is a Blockchain-based platform for the future of TV and video networks, powered by A.I. The architecture combines components of the subscription VOD, online video, and premium cable models to create hyper-efficient recommendations and increased payouts. Built in partnership around a deep set of proprietary APIs and predictive analytics, AlphaNetworks powers an agile, diverse, more transparent media ecosystem. More information about AlphaNetworks, the team, and an explanation of the technology can be found at & Telegram at

Seth’s episode segments can be viewed on the AlphaNetworks Facebook page, here.

Unlike shows that appear on cable and can be measured by Nielsen ratings, Netflix doesn’t release it’s viewership numbers. So while we can assume Stranger Things was a huge hit, we don’t know how big it’s audience actually is.

This gives Netflix a tremendous informational advantage when negotiating fees with content creators and rights holders. Without access to Netflix’s “black box” of data, it’s impossible for agents and producers to know exactly how valuable their intellectual property is to Netflix.

This fact has remained a problem, even as Netflix has grown to become the dominant force in the entertainment industry, with a higher market cap than Comcast and Disney at $170 billion.

Here are a few more stats to show just how dominant Netflix has become:

Given their incredible success, it’s fair for Hollywood creators to wonder if they’ve been getting a raw deal producing content for Netflix.

To get around Netflix’s “black box,” some journalists have been reduced to using clever methods like measuring Wikipedia searches of original Netflix content to estimate viewership numbers.

TV measurement firm Nielsen has even taken a crack at unlocking the mystery that is Netflix’s viewership numbers. They’ve started selling it’s Netflix data to clients using technology that captures audio of what subscribers watch, a similar technique to what radio measurement firms use.

Of course, Netflix has scoffed at Nielsen’s attempts to measure their subscribers, saying in a statement, “The data that Nielsen is reporting is not accurate, not even close, and does not reflect the viewing of these shows on Netflix.”

Given Netflix’s growing power in Hollywood, there are very good reasons for them not to release any of their subscriber data. As Ted Sarandos, Netflix’s Chief Content Officer explained, “Once we give a number for a show then every show will be benchmarked off of that show even though they were built sometimes for very specific audiences.”

So although Netflix’s unprecedented investment in content has been an a boon for content creators, the seemingly eternal adversarial relationship between distributors and creators remains. Each party negotiates against one another and withholds valuable data that could benefit each party. To this day, creators and rights holders — in TV, film, music and print alike — often have almost no visibility into how their content was consumed, and by whom.

This is an entrenched problem that has existed since the studio system in Hollywood has existed. So there remains an extraordinary opportunity for a new economic model to align the interests of distributors and creators once and for all.

A Level Playing Field, At Last

AlphaNetworks has created a platform that aligns creators and distributors, who will both profit proportionally from any success. Since parties only pay and get paid for what is consumed, there’s no guessing or posturing as to the value of a given piece of content.

In the early stages the AlphaNetworks platform will distribute, and in some cases commission, content in areas that our data indicates will be successful. Revenues will then be shared in a fair way by providing a transparent ledger of all relevant media consumption.

Content creators will then be paid proportionally based on how much of the AlphaNetworks’ viewership they accrue, measured using the platform’s Proof of Engagement metric.

The platform’s architecture tracks and records each act of consumption by a viewer, which is then turned into transparent, actionable data to its networks, creators, and advertisers. Every user’s view is anonymized while retaining demographic-specific data, and then recorded on the blockchain for payout at the end of the designated period.

This allows for a revolutionary economic model to emerge, beyond “rate cards,” deficit financing, minimum guarantees, and multiyear licensing agreements.

AlphaNetworks defines Proof of Engagement as a data point that can establish an interaction between a user and video content has taken place. These interactions can be any of the following:

1. Viewing a video for N seconds

2. Clicking on an in-video advertisement

3. Finishing an in-video activity, such as a questionnaire

Because AlphaNetworks provides a transparent ledger of all relevant media consumption, there is no longer a need for adversarial negotiations between creators and distributors, because the essential data is no longer hidden in a “black box” by one party.

AlphaNetworks also replaces the slow and inefficient economics of traditional media with direct, smart contract-driven micropayments. Rights holders receive direct payouts based on actual consumption, as well as access to a robust dashboard of analytics. With integrated wallet support, users can spend directly on a variety of goods and services directly from the main user interface. Advertisers will gain invaluable insights from Watson AI’s predictive analytics, automatic visualizations and customizable dashboards.

One of the primary functions of maintaining a sidechain of the main AlphaNetworks blockchain is that content creators can get provably correct data analytics for any particular piece of content. This ensures that content creators have full transparency on how many views were generated, how many tokens were paid out, how many ads were clicked on, and how many viewers viewed the content.

Since it’s inception, Hollywood’s accounting practices have been deliberately opaque. It was made possible during an era when a very small number of entities controlled all content, production, and distribution. With the blockchain, these practices can be put out to pasture.

AlphaNetworks disrupts Hollywood’s traditional economic model by outputting transparent, immutable records of the content consumed on its services. This fundamentally aligns all of the participants on the platform, which in turn increases the network effect for AlphaNetworks.

Imagine a world where creators are no longer at an informational disadvantage. Where all the players: distributors, creators, and advertisers alike, are playing from the same deck of cards. AlphaNetworks has created a platform that does exactly this, offering a democratized, transparent infrastructure for the next era of media. Join us in make it a reality.