Would you go to the movies to watch Youtube?

To start the year I’ve been working on a Cosmos AI relaunch. New site, new logo, and new positioning.

I’m documenting it all on X. If you want to support my work, please consider following me there or on LinkedIn.

Let’s start the show.

Would you go to the movies to watch Youtube?

My top two activities in December:

• Watching the entire Mission Impossible franchise on Paramount+ (all 7)

• Diving into the business of the creator economy

I had never seen all the Mission Impossible movies until recently. I always thought Tom Cruise was pretty cringe.

But after learning more about his insane work ethic, it’s hard not to respect his commitment to his craft.

Anyone insane enough to strap himself to the side of an airplane for 8 takes has rightfully earned the title of biggest movie star in the world. That’s why he was the highest paid actor in the world in 2022, by far.

Take Top Gun: Maverick for example. For this film:

• Lockheed Martin built a prototype supersonic plane.

• The actors actually flew in F-18s.

• Production crews built special cameras to mount inside fighter jet cockpits.

The production costs were so high the movie needed to earn ~$305M just to break even.

That’s why Cruise insisted on releasing the movie in theaters, not directly to a streaming service, despite many offers.

The bet paid off – Top Gun: Maverick grossed over $1.4B worldwide. Cruise himself negotiated to be paid 10% of all ticket sales, earning him ~$100M.

Movie theaters 🤝🏽 Artists

Fast-forward to December 2023 and movie theaters are starting to do something interesting. They are striking deals directly with creators.

Well, global music superstars to be exact: Last month Taylor Swift and Beyoncé both released concert films that were negotiated directly with chains AMC and Cinemark.

Each was reportedly paid over 50% of the ticket sales, all without a traditional distribution agreement with a major movie studio.

The Eras Tour grossed over $250M worldwide, Renaissance did $44M.

This is a bad sign for movie distributors. They’re salty they didn’t get a cut of these releases and they’re suggesting that movie theaters are stepping on their toes.

Toss in the reports that Warner Bros./Discovery and Paramount are discussing a potential merger and the picture looks shaky for the studios. They are under pressure to turn a profit on their streaming services and while it looks like things are improving, it’s moving slowly.

 Disney, Paramount, WarnerBros, and Peacock are all trying to stop the bleeding, with Disney+ aiming to reach profitability by the end of this year. Disney has invested $10B into Disney+ since 2019.

Even Netflix is releasing fewer shows in 2024.

I think trend is important for 2 reasons:

• The biggest artists in the world are cutting distributors out of deals

• They’re making more money than ever

What does this mean for the average creator?

One argument is that Taylor Swift and Beyoncé are outliers. They are global-pop stars who are uniquely positioned to negotiate favorable deals with any major company.

Another way to think about this is that they are both pioneering a new business model for creators. A model where the creators who cultivate dedicated fan-bases hold a tremendous amount of leverage in any deal they strike with a distributor or sponsor.

Let’s look at the broader creator economy for context.

The Creator Economy is booming

Did you know creator platforms on Stripe have paid out over $25B to creators since 2021? Their research shows this sector of the economy grew just as fast in 2023 as it was in 2021.

Globally Stripe estimates the creator economy is worth $250B.

Take MrBeast for example - he is the largest Youtube creator in the world and reportedly earned $54M from his main channel in 2023.

He has over 228M subscribers and he gained almost 100M in 2023 alone. That is acceleration 🚀

At the moment he is the model content creator. Even Elon Musk has been trying to get him to help boost X’s creator platform. MrBeast politely declined. 

What’s interesting about his response is how he thinks about the return on his investment for his content. If he is spending millions of dollars to produce a video and sometimes months of production, could we consider him to be the next Tom Cruise/Taylor Swift/Beyoncé?

He is creator, obsessed with his craft, who spends millions on production and has the power to negotiate directly with whatever platform he wants.

Movie theaters as platforms

Is there a future where MrBeast releases his content through AMC? I’m not sure. AMC would have to offer him something unique that he can’t get by dropping a video on Youtube.

MrBeast has experimented outside of the Youtube platform before – he’s launched a candy bar and recently started a Youtube analytics company. 

Would fans go to theaters to watch a MrBeast movie when they’re used to seeing him on Youtube? What could MrBeast earn from a deal like this? His videos normally get >100M views.

For comparison, ~40M people saw Barbie in theaters last year. That is less than half of the views for MrBeast’s weekly videos.

Maybe it’s not about views or money and it’s more about cultural relevance.

MrBeast is well known for social impact, whether it’s donating money to random streamers or helping blind people see. Maybe AMC and MrBeast could partner on a deal to donate a percentage of revenues to 500K strangers.

This is pure speculation, but interesting to think about what AMC could offer MrBeast, or other creators, to entice them to create directly for theaters. Some food for thought.

🍲 My content diet:

Here’s what’s on my mind.

1. Reading: Moneyball by Michael Lewis

2. Audiobook: Mindset by Carol Dweck

3. Podcast: Where it happens by Greg Isenberg

4. Music: Kalaman (Soundcloud & Spotify)

That’s it for me. If you enjoyed this, share it with a friend.

Brian