Web3 Renaissance: The Golden Age of Content

Article Authors: Li Jin, Katie Parrot
Article Translator: Block unicorn

In January 1996, Bill Gates published what would later become one of the early internet's classic articles. In it, he described the characteristics of the internet that would lay the foundation for the creator economy. " One exciting thing about the internet is that anyone with a personal computer and a modem can publish any content they create," he wrote.
While Gates's article is remembered for its foresight regarding the direction of internet development, it is less known that he also issued a warning: "For the internet to thrive, content providers must be paid for their work," he wrote. "The long-term outlook is good, but I expect a lot of disappointment in the short term."

Gates's analysis was ahead of its time. While the internet indeed allows almost anyone to publish content online, 25 years after " content is king," it has proven difficult for content creators to earn a substantial income.

The firsthand experiences of creators tell a story: 90% of streaming royalties on Spotify go to the top 1.4% of musicians. The top 1% of all streamers account for more than half of Twitch's total revenue. 1% of podcast hosts capture the majority of podcast advertising revenue. "For me, we are not yet in an expansion phase," a musician told The New York Times regarding streaming income on Spotify. "From a musician's personal perspective, our labor returns are just on a downward trend." This is not inevitable, nor is it unique to emerging artists—it affects 99% of creators, including celebrities with millions of followers. Even as they strive to make a living online, there are forces deliberately hindering them.

The internet was supposed to usher in a golden age of media—a world of infinite richness where anyone could create anything they wanted, and everyone could find anything they were interested in. However, while Gates's prediction that making money online through content has proven correct, most of the money has bypassed the creators of that content and instead ended up in the pockets of the platforms that aggregate it.

This is a story about how web2 internet has broken the media business model and how the emergence of web3 signifies a disruption of that business model, shifting the scale in favor of creators. Without built-in monetization methods in the web2 internet, the primary business models are opaque, ad-based, and reliant on closed networks, giving platforms a significant advantage. On the horizon, new business models and technologies promise to unlock economic opportunities and control, ushering in a true creative golden age for artists and creators.

The Attention Economy and the Original Sin of the Internet

At the heart of the story of how the internet has broken the media business model is a simple fact: the internet was not built to facilitate the flow of money. Payments were not built into the infrastructure of the internet—it was deemed too risky. Marc Andreessen calls it the "original sin of the internet."

The lack of payment infrastructure is why the internet monetizes through advertising. Instead of asking users to pull out their credit cards and enter their information on websites, users can profit indirectly without friction, paying not with their money but with another asset: their attention. This has shifted power from the old media gatekeepers—publishers, record labels, and film studios—who control content creation and distribution to those who aggregate consumer attention on a large scale.

Ben Thompson of Stratechery has written extensively about how the platforms he calls " aggregators" have won the battle for consumer attention by aggregating demand, resulting in enormous revenue and influence. YouTube has over 2 billion active users each month. Facebook has nearly 3 billion. Spotify has 365 million, and with these massive audiences come huge advertising revenues. In fact, Google and Facebook alone accounted for more than half of digital advertising revenue in 2020.

The advertising business model profoundly affects how platforms design their products. Views flow to already popular content and creators, successfully creating a power law. Data about user preferences and behaviors is the most valuable asset for platforms, so they close off their ecosystems and lock users into their networks to accumulate the largest proprietary data corpus.

The ad-based revenue model also has a significant impact on content creators. Creators are forced to seek the broadest possible audience and create content that attracts advertisers. This business model (or lack thereof) has far-reaching effects on how creators make a living and the content they produce (incentivizing viral, attention-grabbing, and aspirational content while suppressing niche, in-depth content). The most significant impact of the web2 internet may be the absence of creators and the works that were never made because they lacked a viable business model.

From Attention Economy to Ownership Economy

The platform-centric, ad-driven economy may have won the web2 era, but its victory is neither inevitable nor final. We have previously written that in a rapidly evolving legitimacy crisis, creators' patience with platforms is waning—they are beginning to question whether platforms have the right to exert such control over their work, their relationships with fans, and how they are rewarded for it.

Meanwhile, a new generation of technologies is emerging, promising to change the balance of power in the creator economy. If the pre-internet/web1 era favored publishers and the web2 era favored platforms, then the next generation of innovations (collectively referred to as web3) is about shifting the scale of power and ownership toward creators and users.

There are four main ways this will happen:

1. By introducing digital scarcity and restoring pricing power to creators.

2. By making supporting creators an investment act, not just altruism.

3. By introducing new programmable economic models that spread wealth throughout the creator ecosystem.

4. Most importantly, by creating pathways for creators to not only own the content they produce but also the platforms themselves.

In summary, these four shifts are converging into a new era, with new incentives rewarding new behaviors, giving the internet a chance to collectively hit the "reset" button and move toward a fairer distribution of value.

Let’s introduce them one by one.

The Introduction of NFTs and Digital Scarcity

Scarcity has a bad reputation, but it is not just about the lack of consumer choice: it is about the power of producers—in this case, the ability of creators to earn meaningful income from their creations. In our current platform-mediated world of infinite content, scarcity does not exist. On social platforms, content is endlessly commodified—one video is more or less the same as the next, one song is the same as the next, and content can be easily replicated across the internet. Creators sometimes approximate scarcity through memberships or digital purchases (such as selling e-books, albums, or content subscriptions), but the underlying content can be endlessly copied and reproduced. The lack of scarcity leads to issues of creators' content being illegally copied and distributed—undermining attempts at direct monetization.

One reason NFTs (non-fungible tokens) as a technology are exciting is that they allow creators to regain control over their content and reintroduce scarcity dynamics that aid monetization. When creators mark their work as NFTs, they create a verifiable on-chain record of ownership and provenance. The end result is a unique digital asset that can be traced back to the artist. Fans passionate about a creator's work are willing to pay more for this normative media, allowing creators to better capture the full willingness to pay of their fans. The ultimate impact cannot be underestimated: content creators no longer need millions of fans to make a living; they can survive on a few passionate contributors.

The thriving music NFT market showcases this effect in action. On streaming platforms, each stream of a song contributes the same amount of revenue (about $0.004 per stream on Spotify), regardless of the specific affinity a fan has for the artist. In contrast, on platforms like Catalog or Sound, super fans purchase NFT music for thousands of dollars each, allowing creators to earn what previously required millions of streams. Brett Shear, an NFT collector with 45 Catalog songs, told Time magazine: "It's like buying art that you want to hang in your apartment. I want to listen to this music and enjoy it—it's a different feeling of ownership."

Buying NFTs is akin to collecting physical goods, allowing fans to feel closer to the artist and own something rare, similar to "non-fungible super collectibles." The digital scarcity and uniqueness that the web2 internet lacked is realized through blockchain, providing creators with a new business model that reduces economic control by platforms.

Excitingly, the introduction of scarcity through NFTs does not mean access to the underlying media is restricted, like paywalls or paid digital downloads. The media supporting NFTs can still be public goods, available for anyone to use for free. Those who believe this undermines NFT scarcity ("right-click and save") fundamentally miss the point.

Sponsorship+: Supporting Creators as an Investment, Not Just Altruism

In 100 True Fans, I described how creators can leverage their fans' self-interest to profit at higher prices. By providing substantial value and outcomes, creators can more effectively earn a living with fewer fans:

This represents a shift from traditional donation models (where users pay to benefit creators) to a value model, where users are willing to pay more for things that benefit themselves.

Web3 elevates this idea to a new level, as all tokens are investments that can not only fund creators but also benefit holders if the value appreciates. Jesse Walden defines "Sponsorship+" as sponsorship with the potential for profit, a phenomenon introduced through tokenized ownership. Without on-chain ownership records like NFTs or social tokens (imagine trying to resell a TikTok video downloaded from an app), this investment element is impossible in web2.

What are examples of Sponsorship+ actions? Earlier this year, Mario Gabriele of The Generalist crowdfunded 20 ETH for a group of analysts to conduct in-depth research on Coinbase and commissioned artwork to accompany the article. Crowdfunders received a proportional stake in the brief and artwork, all minted as NFTs. Overall, NFT sales generated 28.6 ETH, yielding a 43% return for crowdfunders in just a few weeks.

In addition to sponsorship and investment, another benefit is becoming part of a community of like-minded individuals. Many successful crowdfunding and NFT sales in the crypto space are driven by users' desire to belong to a community, with membership restricted by token ownership. This echoes the phenomenon I wrote about in 100 True Fans: "People are willing to pay a premium for exclusive, differentiated content and access to network with like-minded individuals."

For fans, the potential for profit amplifies their motivation to support creators. Interestingly, it also introduces a whole new segment of users that never existed in web2: speculators. Importantly, all these users—by becoming owners of assets aligned with the success of creators—are incentivized to help expand creators' work.

New Programmable Economic Models

One truth about the creator economy is that creation is often a collaborative act. YouTube creators feature in each other's videos. Musicians draw inspiration from each other's works. TikTok videos often consist of (often invisible) contributions from multiple creators: one creator's soundtrack, another creator's choreography.

Unfortunately, the web2 system is not set up to reward or track this collaboration. In the winner-takes-all world of algorithmic platforms, value often flows only to the viral creators, ignoring all others who contributed to the creation of the work. This has led to strikes and dissatisfaction among creators who feel their contributions are unrecognized and unacknowledged.

In web3, the promise of tokenization means royalties can be established so that the entire attribution chain can profit from collaborative work. Early examples in this area include the split feature of Mirror and Foundation, which automatically routes revenue to various Ethereum addresses that contributed to the project.

It is conceivable that any digital work could utilize elements from a universal media library and automatically consider revenue distribution and attribution. Nir Kabessa wrote about the "meme economy," where ideas remixed and spread across the internet can become the basis for value creation:

Famous meme GIFs link to NFT addresses, so when someone shares the original NFT in their article, they can pull out the on-chain address. This is powerful for memes because it allows them to maintain attribution and context across every platform. Thus, any action on meme NFTs is accessible, readable, and usable across almost all platforms. Every bid, swap, and transaction adds to the metadata of that specific NFT.

Beyond memes (like Dogecoin being a meme), if every creative work is associated with its on-chain record of provenance, that work can be traced across the internet, and creators can profit from subsequent uses of their work.

DAOs and Community Ownership

In this article, we argue that the root cause of inequality in the creator space is that platforms exert excessive control over creators and their works through ownership of the means of content production and distribution. The most direct way to challenge this control is to change who owns the means of production.

DAOs (Decentralized Autonomous Organizations) and other collective ownership mechanisms create a pathway for creators to collaborate without external mediators dictating the terms of participation, breaking the centralized control of platforms over the creator landscape. In a DAO, the governance system is determined by its members, with no external shareholders pressuring for profit extraction. Instead, in creator DAOs, the owners are the participants: those who create, distribute, consume, and value the content.

An early example of a gradually decentralized creator platform is SuperRare, an NFT marketplace that distributes tokens to its artists and collectors, who will manage curation, DAO treasury, and future product direction. Other organizations prioritize community and tokens: ElektraDAO is a community of 42 musicians, visual artists, developers, and strategists who are developing an interactive web3 game centered around music. ObscuraDAO commissions photographers to create projects they envision, providing community, funding opportunities, and educational resources to help them explore NFT photography.

The promise of DAOs is to align incentives through stakeholder-centric measures and eliminate the need for value extraction. The result is a democratized, non-intermediated content landscape where creators can control their works, how those works are distributed, and how the value of those works is assessed.

In addition to DAOs, the inherent interoperability of web3 means that platform lock-in may be much less of an issue than in web2. The atomic unit of web3 is the account, which users control through their keys and can use across any application or protocol. Since all smart contracts are transparent and publicly verifiable, opaque and arbitrary backroom deals are harder to pull off. Although still in its infancy, the web3 world is moving toward a more open and standards-based ethos that benefits creators and users.

The Power and Ownership of Creators

As long as the internet has existed, thinkers and philosophers have envisioned the utopian possibilities it could bring—especially in the media space. That utopian vision has not materialized. At least, not yet.

In the past, I referred to ownership as the original system condition from which all other conditions derive. Ownership determines incentives. It determines opportunities. It determines how wealth is created—and for whom. Over the past decade, we have lived in a time when ownership has been concentrated in the hands of a few centralized tech platforms that control data, end-user relationships, and the means of content distribution and monetization. While user-generated content creation has exploded during this time, it has also led to the overwhelming dependence of the vast majority of creators on a handful of new gatekeepers, widespread burnout, and economic unsustainability.

Fortunately, emerging developments represent a shift in the balance of power toward creators. With key new features enabled by web3—digital scarcity, sponsorship as an investment, programmable business models, and community ownership—we are on the brink of a new creative renaissance on the internet. I believe web3 has the potential to bring incredible opportunities to everyone who contributes and creates online: a true content golden age that we have long awaited.