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Film and TV professionals, studio executives and kit manufacturers are urged to open up to the creator economy or face ruin.
If the media and entertainment industry continues to be protectionist and fails to “open its eyes” to the creator economy, it is going to lose everything.
“I know how much it hurts for many of us to admit it, but admitting we've been beaten is required in order to rearm and reinvent our industry.”
That was the warning from Michael Cioni, media tech evangelist and CEO of AI tool startup Strada, during a speech given to leading figures at the Hollywood Professional Association (HPA) earlier this year.
Cioni pinpointed YouTube and the wider creator economy as the main threat to the domination of studios.
Others, including Batman v Superman producer David S Goyer, have urged studios to play an active part in upending their century-old business model if they want to survive.
Hollywood auteur Darren Aronofsky has even launched an AI company called Primordial Soup to produce AI content, the first of which is a short film made with Google DeepMind’s research team and its video and audio generator Veo 3.
“I know if I were 27 right now, trying to make my first film, it would be me and five friends in a room with computers trying to figure out how this all works and what type of stories we can tell,” Aronofsky told the Financial Times.
“Filmmaking has always been driven by technology,” he said in a statement. “After the Lumiere brothers and Edison's ground-breaking invention, filmmakers unleashed the hidden storytelling power of cameras. Later technological breakthroughs – sound, colour, VFX – allowed us to tell stories in ways that couldn't be told before. Today is no different. Now is the moment to explore these new tools and shape them for the future of storytelling.”
This is a sentiment shared by Cioni: “Five years ago I didn’t think that there was anyone that could compete with us on the level of cache that we have built in our industry. I didn’t think they could compete with us in terms of our technology because it’s too specific and bespoke. They couldn't compete with us on talent since we have the best below and above the line. They couldn't compete with our budgets and they certainly couldn't compete with our history.
“But today, I'm not so sure.”
Hollywood's Competitive Moat
Cioni described the bureaucracy and standards surrounding the creation process of cinema and TV content as having outlasted their purpose.
“Hollywood has built this incredible competitive moat – a boundary that was so effective in anchoring the constant pursuit of high quality. In order to maintain that quality, we introduced a lot of friction. It is expensive and super complicated to do production, post-production, distribution, exhibition, marketing.”
This moat also acted as a barrier to entry to outsiders, keeping control within the hands of a few studio execs. Not any more.
“What would happen if there was a world of storytelling that didn't require any friction? This is what our industry is facing. It really is time to wise up.”
The biggest competitor is YouTube because its core business is the same as old school M&E. “It's to create stories, tell them, and entertain,” Cioni said. “But there is something about YouTube that we do not have. They have no friction. There is no friction because the ability to create, edit and distribute it has, has absolutely no friction.”
Kit manufacturers need to adapt
YouTube’s runaway success, particularly in the last five years, has galvanised the creation of new production tools to service the creator economy. Unlike the specialist equipment sold to the film industry and broadcasters, these tools are designed for general use, they are cheap, and need little specialist skill. In other words, they have zero or low friction.
Microphone maker Rode was one of the first examples of this. According to Cioni, its business was transformed by adding a USB port to a microphone targeting the creator economy.
“Rode goes from a sideshow of microphone technology to the go-to microphone. They sell millions of microphones with this USB technology to make it low cost and scalable.”
Similarly, relatively inexpensive cameras from RED were introduced at a time when no one in Hollywood was shooting digital. Blackmagic Design targeted creators with an Apple MacOS version of Resolve at a time when Hollywood pros were still doing digital intermediates on dedicated computers.
Beyond these well-known brand names are new technologies which have snuck up under the radar of the traditional industry. Among them are lighting vendors Aperture and Cream Source, accessories maker Kondor Blue, Chinese drone giant DJI (maker of the Ronin 4D camera rig used to shoot Warfare and Adolescence), and asset management system Frame.io [co-founded by Cioni and now owned by Adobe].
“Once you are building directly for the creator economy, you have the ability to serve a much larger group,” he argued. “Once you get more feedback and everything that you do gets used by more and more people, it allows you to move faster. The power of this is something all [traditional broadcast and cine tech] manufacturers should understand.”
Other tools targeting production using mobile phones include Bscript, Moment, SmallRig, Splice and CapCut, the TikTok editing app. With 300 million users, CapCut can claim to be the world’s most popular editing system.
“You don't think 300 million editors are going to make a dent? This is going to change everything. This is the threat we're facing. Our sphere of influence has gone. It can't come back. We can't outpace these things,” Cioni said.
What viewers actually want
Anyone who maintains that professionals know better than any YouTuber about how to create quality long-form content is just complacent, Cioni said.
“I'm not suggesting that they can make better quality content. I'm asking, does it even matter when consumers’ tastes change and we aren't serving them.”
For instance, the fastest growing new market in M&E is video podcasts, a format that didn’t exist a few years ago. “It's a completely new invention and Hollywood had nothing to do with it.”
Netflix is now looking into podcasts as a form of content attracted among other things by the relatively low cost of production compared to normal scripted TV. Most recently, it launched The Big Pitch With Jimmy Carr, a 10-part podcast produced in partnership with BBC Studios.
Another example that speaks directly to studios is the 2023 low budget horror Talk To Me. Made for $4m by Australian YouTubers Danny and Michael Philippou and picked up for distribution by A24 it grossed nearly $100m (with a 94% rating on Rotten Tomatoes).
“Given how easy it is for the creator economy to compete with us, the power of the studio could shift from green-lighting (creating) stories to just distributing them,” added Cioni.
Amazon Studios, for example, has started distributing content from MrBeast that is still created and controlled by him. A24 did this with Talk to Me.
“The point is, you don't have to be a movie studio to make a movie. Every movie studio could have a [similar] success 52 weeks a year if you [only] knew how. But we've got decades of experience working against us,” Cioni warned.
Studios and the technology community that serves it are handcuffed by standards, practices and rules around equipment and content presentation that YouTubers simply don’t have. This is further compounded by the shrinking technology gap, which means production is no longer owned by a heavily capitalised few.
“The creator economy are early adopters. When I find a new technology, I have to go through six months of procurement just to try it. That is already stifling progress,” Cioni said.
Shrinking technology gap
To drive home the narrowing of the technology gap, Cioni provided a side-by-side comparison of footage from an ARRI Alexa Mini – the “gold standard” cine camera; a large format 65mm Fuji GFX100 capable of recording 8K (costing less than $8k) and an iPhone 16. All were fitted with the same Nikon Prime lenses (the iPhone had a depth of field adapter and was run by a Blackmagic app) and lighting conditions.
The results appeared to show that a camera that costs close to $100,000 [Alexa] and one that costs around $1,000 [iPhone] are not dramatically different. “This is the visual proof that accessibility has got so narrow that we need to think twice about it,” Cioni urged.
“I am not saying that the iPhone is better than Alexa. It's not. But this is why we can get beaten by the creator economy because they're willing to try everything. They have no reason to hold back. They're never going to use a rule of what camera is approved or not to make a decision on what to use. That is such a huge advantage that they have over our system.”
Furthermore, while the look a camera produces will always be top priority, there will be a point within the next 5-10 years where the image quality gap will almost totally evaporate.
What to do
Cioni ended his presentation with some advice for what industry professionals can do to mitigate the impact of the shifting landscape.
“We need to learn to influence the influencer,” he said. “If you can't figure out what that means, you're going to be missing out on an opportunity, because they love us. They meme us. They cheat us. They copy us. They take our movies and carve them up and make them funny. We are able to influence them. We can change the market just by influencing them.”
He urged manufacturers to build a “technology migration path” that addresses creators. “If you're building a specific product that is niche or it’s in a specialty space, you are taking an enormous risk. Instead, you need to realise that if you build for the creator economy, you can serve both communities. It's possible. There are companies doing that.”
The principles of frame rates, camera formats and colour spaces may have served the industry well, but are now out of date and hampering creative innovation, he argued.
“We do not need a list of cameras that are approved for us to shoot on anymore. We don't need 11 pages of an RFP just to get the green light to test something.
“You need to reconsider these standards and practices and recognise that the creator economy doesn't have [them], which is why they can actually move faster.”
And there was a final word for the studios which was essentially to give up the keys to the crumbling kingdom and hand over creativity to the creators.
“Studios have the ability to set this all in motion, because you are the most powerful. You have the money. You have the cache. You have the buildings, the resources, the libraries and the histories. You control so much of this.
“What we need you for is not to give us script notes, and not to actually give us notes on the cuts and decide if this is a good project or not. That's not your power anymore.
“Your power is in exhibition and distributing and marketing, because you can take a small film like Talk To Me, and you can get it in front of 100 million people. That's where the power of the studio should be focusing itself.”
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