Potential Commercial Revenue in Derivative Works?

I've been pondering lately what sort of revenue opportunities could be available to content production companies who might wish to harness the commercial power of derivative versions of their intellectual property, and whether these markets are likely to emerge. It's obvious that there is already a vast amount of indirect revenue generated in the free advertising that these works provide. In addition, the communities themselves promote further consumption of these products (songs, movies, tv shows etc.) - but I don't mean that sort of revenue. What I'm getting at is the possibility for entirely new markets to be generated to seel directly to creators of derivative works.

Mashups

Of all the current remix phenomena, bastard pop was possibly the quickest to transition from being an underground hobby to being sold in record shops and played on MTV. Heck, one could easily say that the whole Hip Hop genre is an example of this. The music industry has continually generated its revenue by selling the consumer the same product many times. With every new consumer format (vinyl, 8 track, cassette, cd, dvd, digital download) comes a repeat purchase. Classic artists generate as much money now as they did 10, 20 or 30 years ago. Compilations, live shows... again and again the consumer pays for the same piece of intellectual property. DRM and the restricted interoperability of music devices even allow the same digital song to be sold for each new device a user wants to play it on. So it's really no surprise at how keen the music industry is to sell a combination of several songs as a new product.

However, that is just the tip of the iceberg. In addition to these bedroom DJs creating tantalising new ways to repackage these products, the mashup artists are constantly looking for ways to make their remix process easier. Aside from the occasional a cappella track on a cd single, it can be tricky to find clean separated vocals or any other musical elements from a song. 5.1 Audio DVDs have helped with the vocal/instrumental separation but what if the music industry went a step further. Want the bass line from With or Without You? $0.99 The vocals from Gold Digger? $1.99. The potential for the music industry to sell the individual components of song is immense and if the long tail has taught us anything it's that if you have it and can sell it then you might as well do it because all those small payments really add up.

Problem. To do this, they'd have to somewhat legitimise the process of mashup creation or, instead, put limits on the ways in which this new product could be reused. Miserable as it sounds, I can imagine a studio selling song fragments with an EULA that restricted to remixing with other products licensed by that studio... and then limiting the creator's redistribution methods and  having the final remixed product and that the rights of the derived work were still with the studio. In such a case, what has the mashup artist gained? Well, other than the easy access to music fragments, it is actually something of a net loss. I think will be several examples where attempts to commercialise could inevitably end up with a legal leash being placed on creative communities as the industry start to apply their own rules to a previously independant scene with its own free-flowing communication.

Anime Music Videos

So much excellent advertising is produced by anime music videos and it is very very clear that the industry has an excellent understanding of how mutually beneficial its relationship with the fan community is. It dawned on me recently that one bonus feature that has been very common on anime dvds is the inclusion of the creditless opening titles. Now, I understand that the creditless opening has a certain appeal in order for the viewer to see the art and animation without being obscured... but really, of how much actual value is this to the regular anime viewer? If a company has access to it, then of course it is a very easy way  to pad a dvd with content (and anime discs are often criticised for leaving out this simple extra) but in my mind, the main market for this feature is anime music video makers. I certainly wish the season 2 opening of Kodocha was available when I was making Do It Right. I have plenty of anime that I've purchased for making videos and I've always been on the lookout for releases that make my editing work easier with things such as creditless openings and the like.

Could the anime studios take this further? Could we see future anime releases containing easily-maskable footage on clean backgrounds for anime music video creators to use in their videos? It's not impossible, although many western anime dvd producers have limited rights to the works they distribute, so extended licenses would have to come from the original studios. I recall when making the amv for ADV's release of Noir Volume 7 I was under instructions to not manipulate any of the images as they were under tight restrictions as to what derived materials ADV could sell under the license they had bought. 

Even so, I think any moves to provide the user with more ways to acces their content would be very much welcomed by the anime music video community. The fan-industry relationship is very productive and I could only see such a move emphasising that positive relationship. The main question for the studios will inevitably be whether there is a profitable margin to be found between the effort to produce this content and the extra revenue gained from its availability/re-use.

Vidding

Unlike anime and mashups, the live action vidding community aren't quite as focused on creating their works by removing the source entirely from its context and mixing it with other sources. The vast majority of 'vids' are about closer investigations of individual shows and characters. The technical difficulties in doing the kind of manipulations seen in anime music videos restrict the scope (though not the quality) of these derivative productions, promoting a more narrative reassessment angle than a "making something new" approach with these derivative works. Also, because of the way the community is so specific-fandom-focused, there isn't a great deal of desire to take Kara Thrace and have her meet Fox Mulder. It's too niche and not most common way that these creators relate to their media products. That's not to say that there aren't additional products that can be sold to creators of these works. It's a long-standing tradition that blooper reels can offer just the right kind of character moments that a video could require and certainly I think clean, high-quality extras from shows are always tempting products for live action video makers. Heck, Warner Bros could release a dvd which only contained one scene depicting Sam and Dean kissing and there would be plenty of sales (not to mention some very interesting reactions from news and entertainment media).

Unfortunately, TV and movie production companies have had a very poor relationship with this sort of derivative work historically - certainly the worst out of the various remix communities I'm writing about today. Their property is so rigidly protected that I can't imagine any commercial acknowledgement of alternative uses for their IP actually appearing in the ways described here. Beside bespoke tools for remixing shows via flash websites or the occasional call for music videos or fan art with predefined content and context, I don't see much real effort by these industries to encourage 'vidding' as a derivative work in any way, despite the loyalty of the fans and the advertising potential. This, and many other reasons, have resulted in the community of 'vidders' becoming one of the least known remix communities around despite having one of the longest traditions.

Machinima and Game Mods

Game-engine developer kits have been available for years and the potential for scripting, personalising and finally creating with computer game engines has gone from the hobbyist days of the 3D Construction Kit to the far more advanced mods and derivative works we see now. There has not been much movement in the industry with regards to selling developer kits targeted at communities such as machinima (to my knowledge) but I believe that is partly due to the tradition of these tools being provided for free as they offer additonal value to their product. Indeed, the Neverwinter Nights games rely on this for their entire strategy. Numerous products have gained a significant amount of their reuse through mods. Machinma is still *somewhat* out of the industry's mind when producing their games but there are, of course, games designed where the entire purpose is to produce Machinima (The Movies). The Sims is of course one of the many sandboxes that has inspired a great deal of Machinima and futre simulations are bound to continue in thie vein.

While there are rumblings of game producers developing Machinima tools as value-added-content, I think that the separation of sandbox and read-only game will continue for some time - games makers will continue to focus on their product being used as a game and that any derivative works are most likely be games too (mods etc). While it would be perfectly possible for a game to be released as both 'game' and 'creative sandbox', with a focus on redistributing derivative works made in the 'game', such a revolution hasn't happened yet. With the amount of buzz that Machinima is generating, I can see it happening. On the other hand, I'm wondering whether this will be a new sale (selling a machinima toolkit for an existing game) or whether it will be an attempt to add value to existing game products (in the way that anime dvd extras do).

As for the reaction in the Machinima community, I get the impression it will be somewhat positive. There has been a great deal of machinima commissioning lately so I'm sure there will be more to come.

The "Ripped jeans" problem

Will commercial strategies be welcomed with open arms by their respective derivative communities?  I think a lot of it depends on how much the creators and the communities identify with their current status and how non-commercial that is. Is it "cool" to remix and if so, will it stop being cool once the studios try and sell it to you? I think reactions will be somewhat community-dependant but I can imagine the answer to this question being revealed during the next few years in many derivative work communities. This is a ripped jeans situation - kids rip their jeans, companies see the potential in this culture and hence sell pre-ripped jeans, kids no longer like ripped jeans and inevitably find their own way of "ripping" their jeans - finding that identity separate from commercial culture and being more in tune with their own way of life and personal expression.

The ability for businesses to tap into the commercial potential of User Generated Content will have limits based upon how willing the communities are to have their jeans pre-ripped. For some, the sale of pre-ripped jeans will be a blessing which will invigorate and expand the community. For others, the commercialisation will occur without their very knowledge - how many YouTube stars fully comprehend the money they are making for other people? Threadless.com was established with the commercial understanding from the get-go and a vibrant symbiotic relationship has been well established. Then there will be the communities that will react badly to commercial efforts to profit from their dabblings - in some cases, communities will be staunchly divided and, in others, the scene will almost vanish without their cult identity to give them a sense of purpose.

At the moment, as far as I can see it, the main winner is the media industry.... now if only they'd realise it and stop suing YouTube they could get a move on with making money from other people's hard work :)