By Penny Riordan • LMA Director, Business Strategy and Partnerships
Can you remember when you first heard about NFTs, a topic that seemed to explode in the past few weeks? Was it when you heard about the artist Beeple selling an NFT for $100 million earlier this month? Or was it when Jack Dorsey announced he would sell his first tweet as an NFT?
It wasn’t long after NFTs exploded that news organizations started to explore the revenue opportunities, with Quartz publishing an article as an NFT and TIME auctioning several of its iconic covers as NFTs.
NFT stands for “Non-Fungible Token,” something that serves as a certificate of ownership for a digital asset, according to a recent Digiday article.
For most local media leaders, March was when they first heard about NFTs as well and started to research the product more closely. Members of the LMA Digital Club were able to learn more about the topic in a recent monthly club call.
If you are a news organization looking at what you can do with NFTs, here are some questions to ask about them, pulled from the conversation with invited experts on the club call:
What do you get when you buy an NFT?
Jeff Hermes, the deputy director of the Media Law Resource Center, said news organizations should see ownership as involving two parts: A record in the blockchain showing your ownership as part of the transaction history and a copyright license. This license is usually a license to display the artwork in certain circumstances, Hermes said.
Do I need to own the items that I sell?
In order to create or sell an NFT, you need to be the holder of the rights embodied in the copyright license you are offering to sell; this usually means that only copyright holders will be able to create NFTs, while purchasers will be able to resell what they’ve bought in the marketplace where they bought it (and possibly elsewhere). But if it’s a popular or well-known photo, other news organizations will probably still push to use that image as part of fair use in copyright law, Hermes said.
Where can I sell them?
Since NFTs exist on a blockchain, they can only be sold on places that accept cryptocurrency. The leading platform for NFTs is Ethereum.
What could I sell as a news media organization?
The short answer is you can sell anything you own, and since the uniqueness of the asset lends itself well to art, most news organizations are looking at things like iconic photos or videos, or magazine covers, as TIME did. Before you sell though, Hermes recommends reading the terms of service on any sites where you are considering selling to see what those are to understand the rights of the user you would be selling to.
What other opportunities exist for NFTs beyond selling assets?
Beyond selling versions of assets such as videos or photos, NFTs could also be sold as a part of a rewards program, which is what Decrypt Media launched recently. The news site, which focuses on covering cryptocurrency and the decentralized web, thought the best way to teach people about NFTs is to give them a chance to own them.
Through the Decrypt app, readers receive tokens by reading a story, sharing it on their social networks or reacting to it. If readers accrue enough tokens, they can swap them for an NFT created in collaboration with an emerging NFT artist.
Decrypt Co-Founder Matt Hussey said the team are exploring other use cases for NFTs – above and beyond digital artworks – including using the technology as a key to access future events, for example.
In the immediate launch of the Decrypt reader token, the company was gaining a new user every four seconds.