Blockchain: What it is and What it Means for Video
Will Blockchain be to Netflix what Netflix was to Blockbuster?
The digital world today
The Internet today is a “world wide web.” Naturally, you knew that. In this spider web all the points, all the individual computers, lead to a center. That center is a large computer server that stores and processes all of the transactions, data, and personal information for your web browsing, online purchasing, and Facebook posts. This is how the Internet has looked like for over a decade and a half.
Now there are some big flaws with this system, flaws that have existed for years. If you’re a hacker looking to do some major damage, you know exactly where to hit. A centralized system has a clear point of vulnerability, and though security is top-tier at the server level it’s not exactly impregnable. The second flaw, for some the more important one, is traffic. We live in an age where millions of dollars are spent a year to shave off nanoseconds of load time. A server-based, “centralized” system concentrates all of the data in one point, and will become congested like a road everyone needs to use to get to work.
Blockchain is looking to change that.
What in the world is “Blockchain?”
Blockchain is a relatively new concept that was originally designed for bitcoin. Instead of a central server, the blockchain is a database network of voluntary user computers called “nodes.” Each computer offers a bit of storage, and simultaneously each node has perfect access to view all transactions within the network. As there is no single server, traffic is greatly lessened. The main incentive to add your computer to this “decentralized” system is the chance to deal in bitcoins or other cryptocurrency, the so-called “digital gold” that has the economic world reeling. Today a single bitcoin is worth over $9000 CAD. They can be gained by transacting within the network.
Once you’re within the blockchain network, every transaction is timestamped, bundled with other transactions occurring in the networks as a “block” of data, and attached to the chain. This is where the appeal of blockchain lies. Every block can verify its neighbouring block via timestamp. The blockchain in its entirety is available as a single entity shared amongst thousands of computer sources, each with full transparency on the information. If a single computer has a wrong block, the other thousands of computers will verify it. That means the data is entirely immutable, untraceable because it’s on every computer, and thus fully accountable, which makes it far more difficult to break into and change unless the hacker has the computing power to overhaul all computers in the network.
OK, so blockchain is like a superhero Paypal. How does that affect video?
Much like how the Internet was originally purposed for messaging between universities and has since grown to immerse everything imaginable in our lives, blockchain stands to become a huge factor for video creaters and watchers in the near future. Blockchain represents the latest frontier in the protection and enforcement of intellectual property. Since the dawn of the Internet age, intellectual property rights have been scoffed over, as illegal hacking and streaming of videos floods the medium. As a fluid database system with incredibly high security and a natural system that repels hacking efforts, blockchain shuts down a large portion of online theft and piracy.
P2P Distribution and Content Monetization
On the other, legitimate side of video streaming, the peer-to-peer nature of blockchain reduces transaction costs, and allows video consumers to pay directly to video creators and providers safely and efficiently. This could represent a huge blow in the future to popular middleman distributors, namely Netflix and Amazon Prime. New blockchain technology is already seeing use in early community video-sharing sites, where users are encouraged to create videos to generate the digital cryptocurrencies to then consume videos. They can watch sponsored content to generate cryptocurrencies or gain access to other videos. Blockchain allows the Internet to safely become an open marketplace for video creators and consumers at low cost and low risk for both sides.
No central server means there is no authoritative force to control or censor what is available to view or distribute either; it’s a pure user-controlled system in terms of pricing and content. This is a huge factor for those in the independent filmmaking scene, as Netflix and Youtube all require strict content supervision for users to remain on their platforms. Netflix’s content is not only affected by censorship, but also by contract lease periods. Not every movie on Netflix will be there forever, unless they choose to renew the contract. You watch what they provide to watch, not necessarily what vendors have to offer. Though the flexibility of when and how to watch is of higher convenience, Netflix is still more similar to cable than you may think.
Does this mean Netflix is going to go under?
Despite what some blockchain enthusiasts say, most likely not – at least not immediately. Netflix has made the Internet its home base, and still has its prided “suggestions on what to binge next” algorithms and branded original content. However, in the future, far cheaper subscription models may exist because of blockchain, with a chance of a much larger and faster archive of video content. Blockchain is like the fax machine in the late 1980’s: it’s new and different and only really works well once everyone has one. However, once blockchain becomes big enough to sustain itself, Netflix, Youtube and Hulu are going to want to be ready for the waves it makes.