A Practical Path for Decentralization
Last week we announced Props, a new cryptocurrency used to power video applications and equitably reward the users, creators and developers that make up digital media networks. We also announced the Rize video platform, the first Props-powered app, which will enable developers to leverage our open, many-to-many video technology. The ecosystem will be seeded with YouNow’s community of millions of users and thousands of influential content creators, who already take part in a two-sided marketplace powered by a (non-crypto, centralized) digital currency in which creators earn. Over the past three years, we have generated more than $50M in digital goods sales and continually share the majority of our revenue with creators.
The YouNow team has been working on this project for the past year, and we are thrilled to finally share it with our community and the world. The initial reactions from existing YouNow users and creators to our vision have been overwhelmingly positive. The official launch of Rize will be in the coming weeks, once Props are distributed.
Our Vision and Motivation
In our view, the world needs a decentralized digital media ecosystem for two primary reasons:
- The value created in digital media is disproportionately distributed between the network operators and the users of these networks. Network operators generate hundreds of billions of dollars in enterprise value, while users only receive a tiny fraction of that value. For example, users and influencers creating engaging content are at the heart of Facebook and Snapchat’s success, yet they didn’t benefit when these companies IPOed and they don’t reap proportionate financial value from the platforms today.
- Media distribution is currently controlled by a few large companies, leaving decisions about the content the world gets to see in the hands of a small group of people.
Props is transformative in this context because it enables network contributors such as Snapchat video creators, Facebook content curators and Instagram influencers to programmatically receive an equitable reward for the value created by the networks they comprise. They get a personal stake in the community they are creating, a long-term interest in its success and motivation to grow it. The same is true for media companies and publishers contributing content, who no longer need to settle for whatever margin Facebook, YouTube or Snapchat choose to leave for them. The same goes for developers building new apps within this decentralized economy. Rather than getting copied or out-competed by a larger network, they benefit from its growth.
YouNow is fully committed to this vision, as YouNow itself is transitioning from its current status as a C Corp to become a B Corp, with a Props-centric mission: creating a more open and sustainable media ecosystem.
Our Practical Approach to Decentralization
To bring Props Project to fruition, a practical implementation path of decentralization over time will be required, and we’re starting with the economy. Mainstream digital media users are accustomed to using apps that are free, readily fast, available on their smartphones and have easy access to in-app purchases. Decentralization of the digital media components that can work just as well as centralized apps is a long-term effort requiring advancements in the development of a decentralized infrastructure layer. Key challenges include handling the demands of live video streaming, high volume microtransactions and low latency messaging at scale. For example, running all of YouNow’s current 60,000 daily transactions on-chain would be ineffective, result in subpar UX, and become unrealistic in a 10x growth scenario. Therefore, the roll out strategy is to first leverage Props within Rize to pay rewards, provide in-app utility such as status and access to features, as well as for interoperability amongst other applications in the ecosystem to create a larger social graph and value layer.
Our approach allows us to ship a mass market app — easy to use and accessible on everybody’s device — with a tokenized, decentralized digital media economy. This way we exploit the distribution efficiencies of tightly managed mobile apps that enable participation by mainstream users.
The Rize platform will launch with the YouNow community base, encouraging millions of users who already transact in a digital economy to use Props and grow the use cases for the token and its value. The potential outsized financial utility “mined” in the early days of cryptoeconomic networks creates powerful incentives for early adopters (including users, creators and influencers who are not on YouNow today) to participate even before mass market adoption is achieved.
Rize will demonstrate the ability to operate a viable business opportunity within the Props ecosystem, thus contributing to the adoption of Props by additional ecosystem partners. Internally, Rize generates a stream of in-app purchases which in turn drive demand for Props used to reward its content creators and developers. Externally, Rize will position itself to receive Props rewards from the Foundation’s partner rewards program which is set up to maintain 50% of the total supply and competitively allocate rewards. Props users will be able to take their identity, relationships and tokens with them between Props powered apps, so new platforms and apps that integrate with Props will be able to quickly onboard users and benefit from network effects across the ecosystem, as well as the Foundation’s partner rewards program. A diversified network of ecosystem participants will over time further decentralize the Props economy.
This is a summary of our practical approach to decentralizing media. The Props whitepaper provides more detail. We’re excited to walk together with millions of YouNow users and many others on this path toward a more level media playing field and an empowered community.
