As you probably know, this Sunday the NFL’s L.A. Rams and Cincinnati Bengals will face each other in Super Bowl LVI.
And while you may have mixed feelings about the teams (or not care at all), this annual event had a surprising impact on how we interact online today… and how we’ll interact in the metaverse in the years ahead.
We just need to go back about 20 years to connect the dots… to a Super Bowl that even non-football fans probably remember.
One of the First “Viral” Videos in History
In 2004, a record-high 144.4 million viewers tuned in to Super Bowl XXXVIII.
They watched as the New England Patriots clinched a last-minute victory against the Carolina Panthers, and a young Tom Brady was crowned MVP for the second time.
But the day after, hardly anyone was talking about football…
Instead, the focus was on what happened during the halftime show.
At the end of a performance by singers Justin Timberlake and Janet Jackson, Timberlake tore off part of Jackson’s costume, briefly exposing her on national television.
TV network CBS immediately cut to an aerial shot… But the damage was done.
The Federal Communications Commission (FCC) cracked down… triggering a widespread debate on censorship and indecency.
Meanwhile, speculation ran wild. Was it an honest mistake? Was it a premeditated publicity stunt? Was it meant to distract from other, more serious global issues?
With no easy way to review the footage, speculation surrounding the controversial performance exploded. It was one of the first truly “viral” videos.
If you remember the incident, you probably know it’s where the term “wardrobe malfunction” was coined.
But you might not know that it was the inspiration behind the world’s largest video hosting and sharing platform…
An Overnight Success
In the early 2000s, developers Jawed Karim and Steve Chen and designer Chad Hurley decided to leave PayPal (then only 2 years old) to pursue their vision: A dating platform that allowed users to upload video profiles.
The website struggled to attract interest… and the co-founders even took out ads offering to pay women $20 to upload dating videos to attract users.
Then the Super Bowl “wardrobe malfunction” happened…
Although thousands of people had recorded the halftime show, there was no easy way to share it. Many networks refused to air it, fearing fines from the FCC.
That’s when Karim, Chen, and Hurley had a lightbulb moment: A website where you can easily upload videos and watch them for free.
So, in 2005, the trio launched YouTube. It was a huge success.
In April that year, Karim uploaded the platform’s very first video. It showed him standing in front of an elephant at the San Diego Zoo.
Two months later, a different video hit 1 million views… a first for the platform. It was a Nike ad showing Brazilian soccer star Ronaldinho receiving a pair of golden boots.
And by December, YouTube officially launched to the public. Anyone could upload videos. The site attracted 8 million views each day right out the gate.
The next year, YouTube added advertisements to videos… And in October 2006, Google acquired YouTube for $1.65 billion.
Once YouTube monetized videos, it wasn’t long before it offered popular users a way to get a cut of the ad revenue.
So, the following year, YouTube rolled out its Partner Program. It was a first-of-its-kind way for users to profit from their videos.
Today, YouTube is estimated to be worth roughly $500 billion as a standalone company… it has nearly 2.3 billion active users and is the second-most popular social network behind Facebook.
But here’s the problem…
The Pitfalls of Centralized Platforms
Despite setting itself apart by giving users a cut of advertising profits… YouTube now censors content for various reasons.
By creating roadblocks between content creators and their audiences, YouTube and other platforms make it difficult for content creators to transition into the next phase of online interaction: the metaverse.
Here’s what I mean…
There are currently over 37 million YouTube content creators uploading an average of 500 hours of video every minute. And many of them depend on YouTube as their main source of income.
But content creators on platforms like YouTube, Facebook, and Instagram are held hostage by these platforms.
They don’t own their YouTube profile or its content in most cases.
That means your name and brand only exist as part of the platform. And the platform owns any material you upload and can use it – and its associated data – to profit without your consent.
So creators can’t easily move their assets from one platform to another.
Sure, they can post a link to their YouTube video on Twitter. But the content still exists on YouTube… And Twitter users will have to migrate from Twitter to YouTube to access the video.
And as you can imagine, it’s next to impossible to convince every follower or subscriber to jump from one existing platform to the next.
Many millennials and Gen Z-ers have accounts across multiple social media platforms. But if they follow a popular creator on Instagram, they don’t necessarily follow that creator across multiple platforms.
And most ominously, content creators can be censored or de-platformed, causing them to lose their source of income.
(This isn’t just a hypothetical debate, either. Today, one of the biggest stories is whether Spotify should cancel a $100 million deal and de-platform Joe Rogan over his controversial statements about COVID-19 and race.)
Even if the perceived violation is a mistake or misunderstanding… It can be fatal to the career of a content creator if the platform revokes the ability to share ad revenue.
Essentially, YouTube has fallen victim to the inevitable trajectory of all centralized platforms: It’s become a gatekeeper, just like the large TV networks it set out to overthrow.
So, it’s only a matter of time before these creators relocate to a more accessible, decentralized environment… the metaverse.
Life After YouTube
Thanks to the blockchain’s decentralized nature, the metaverse will enable users to own their digital identity and the value it creates.
And because creators are building their brands on a decentralized network, they’ll become censorship-resistant. This means they can act and interact freely without worrying about being shut down or demonetized.
It will be an immersive experience where creators and viewers interact in sensory-rich environments delivered via augmented and virtual reality.
It may be hard to envision its full scope… But just like the internet, there will be a creator economy for the metaverse.
And that opportunity will be even bigger… for both content creators and early investors in those metaverse projects.
Fortunately, there are multiple ways for investors to get involved… ways that are easier and cheaper than speculating on digital art or NFTs.
In fact, Daily editor Teeka Tiwari believes you’ll see some of the fastest gains in history if you invest in the foundational cryptos and companies helping to develop the metaverse and its content.
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We’ve come a long way since that 2004 Super Bowl… and I’m sure none of us could imagine a “wardrobe malfunction” would lead to a multibillion-dollar content sharing platform.
So, don’t make the mistake of writing off the metaverse… Because once creators grasp its full potential, its best projects will soar.
Analyst, Palm Beach Daily