Enterprise Ethereum Panel | Games, Art, Music

[Music] Next, we will move on to the next panel discussion. In the next panel discussion, titled "Game Art Music," we will have two guests take the stage. Please come to the stage. Yes, then, Osaka Festival. Yes, so next, yes, um, we would like to talk about game art music.

Mr. Hata will give us a brief introduction of 12 pieces. Yes, hello everyone, I am Haneda from SKYMIX. I have only been with the company for about 10 years, but for the 10 years before that, I worked on console games, created solutions using middleware, worked on embedded systems, and also worked as a writer and lecturer, so I have experienced quite a variety of jobs. I joined Square Enix and for a while I was a Technica Director, supporting the technical aspects of mobile games, but from 2021 I have been in charge of the Business Department, which is responsible for creating business relationships, and in the process I have been researching blockchain since around 2017, and in the wanted to create a proof-of-concept experimental product, which is a bit unfamiliar to people outside of Japan.

Although it's not an existing IP, we launched a content project using the Million Answer IP, which has asset value and appeal, as an NFT project. This is the slide you see now, and it's a product that uses the LINE blockchain. We started working on it in October 2021, so it's been about a year and a half now, and this Thursday we released the latest installment, the 6th in the form of digital stickers. Currently, we have sold and issued around 140,000 NFTs, making it a rather unusual project. It's a service that is currently only available in Japan, but it has produced results that justify that number.

Next Thursday, the 20th, we will integrate a game content that uses these digital stickers into the service. What this will do is, as you can see in the upper right, there are parts, and these parts can be obtained by playing the game for free. You don't need to own the NFTs to play this game; it's a game that can be played for free whether you own the NFTs or not. Collect these parts and turn them into digital stickers. 。 。 English: When you combine the images, the characters start moving, and there are gimmicks like that, so it's content that can be played in a way similar to a photo booth.

Please move on to the next slide. And we are working on another project, which is a project that uses Ethereum and polygons, and it is a project to create and sell characters in the form of generative art, and up to that point it is a fairly common project, but since we are a company that is good at stories and worldviews, we are taking on a challenge to attach a story to all 10,000 characters, and we have prepared a treasure hunt-like element to the project where you unravel the story and explore the mysteries of the world. We are currently preparing to expand this globally, and we are thinking that we would like to release it by the time it gets exciting. Yes, thank you. Next, Mr.

Yanagawa, please. Yes, no, it's fine, my name is Iwanaga, and currently I am working at APEX as a Web3 advisor, but originally I was here about 4 years ago It was about five years ago that I joined APEX as a senator, and there I became the CEO of a company called Technologies, and we also acquired other subsidiaries, and I was working with a team there, and we were also working on a blockchain project. Before that, I worked as a product manager for about nine years at a NASDAQ-listed company, and I was in charge of game publishing, publishing over 100 titles on Steam, so we actually had a game business co-located within Avex, and I was running that for about four years, but this time I'm specifically getting into Web3 games, and there are quite a few things that can and cannot be done within a listed company, so this time I've gone outside and will be starting a company in June to do that, and I'll be running the game business within that company, and I will continue to be at Avex as a Web3 advisor, so that's my background. Now, please turn to the next page. Yes, actually, since about 2019, before NFTs became popular, there was a service called A+t, and this itself is actually It was built on a private chain, and it was similar to what you might call a Seoul version of a token today, for verification.

For example, within Avex, if there was a dance lesson, and after completing the Lance Restaurant Dance Lesson, there was talk of needing proof that you had graduated. In particular, when they took their know-how overseas, there was a problem with the curriculum itself being stolen and copied. So, to address this problem, they decided to use proof that someone had graduated and where. There are now membership-based NFTs, and they felt that something like that was necessary. Ethereum was of course an option at the time, but there were hurdles to overcome for a listed company to own cryptocurrency.

So, they decided to create their own private chain, running about five machines at a time, and issuing certificates there. This was done through Trust, and it was mainly a B2B business, with NFT Records actually using it, selling NFTs of various artists. When we do that, we've actually been using our A Trust system to make NFTs light up, and we're still doing that now. And another thing we've introduced is the new concept of an asset bank. Nowadays, AI is an amazing technology, and I think we're entering an era where we can use AI technology to break down all sorts of data, like PVs, or even PVs for our own original male music.

We're thinking that we're entering an era where we can create NFTs, for example, from a single dance motion. In the current music industry, there are copyrights for the music itself, but there are n't any cases for male motions. But if we think about how we can properly turn these into NFTs, we need to be able to register them and license them all at once. So we've actually set up a POC with the government and created an asset bank, which is a system where licensing companies can register decentralized, very finely divided digital data. So, we decided to create something that ordinary people and individuals could use, and we actually started a POC around 2020.

This initiative itself is actually part of a consortium called JCBI, and we thought that this shouldn't be done by just one company, but rather, we should somehow manage the state of NFTs before they enter the market, for example, by having an asset bank track who gave the NFT to whom. So, this initiative is actually something that we have been doing as a company, and that's what I've explained so far. Yes, thank you. Now, let's begin. Let's start with one point.

Keep the sentences short. Yes, yes, yes. So, first of all, Square Enix has really been able to commercialize things in a concrete way, like increasing sales in games, and I think that has overcome some of the dilemmas that blockchain has. But what are your thoughts on the current market trends and expectations that come with blockchain? The services that have been launched are as mentioned earlier.

As I mentioned, there is a service called Million Arthur, which is a digital sticker service, or perhaps it would be better to call it a digital sticker service. However, to be honest, we are only selling NFTs, so it is difficult to commercialize this alone. Selling NFTs means that everyone will know how many we issue and how much we earn, so we can calculate the revenue we make. However, when it comes to actually making a game, the cost aspect doesn't quite match up, so we are currently thinking about and developing a new manager to address this. There is a sense of expectation and demand for blockchain games, specifically because they are blockchain.

Until now, games have been in a model where we lend out the right to use the game for people to play, but with this, the base will be customers who buy digital assets, so I think the point where customers are most enthusiastic is how much value that will have. Mr. Iwanaga from Avex, on the other hand, is more focused on the assets of individuals and artists. I think the main focus is on its value, but now that the NFT craze seems to have run its course, what is the current state of expectations, what is the demand for each artist, and so on? What is the state of things?

Well, first of all, there is a big difference between games and music. Games are interactive and users participate in them, while music is more of a one-way distribution that is listened to automatically. In this program, I feel that the expectations for NFTs are very different between games and music. [Music] And when it comes to NFTs for music from a company's perspective, it gets quite close to the issue of rights, and when it comes to decentralizing copyrights and performance rights, I think the stance from the company's perspective is that there are big question marks. I see It's small The people who are most sensitive to this in the music world are the artists, and artists are also listening passively.

tackling how to involve people with NFTs and how to create an interactive community is something that seems visible but isn't really clear, and we're currently seeing various challenges in that area. It's definitely something that's attracting attention overseas, and we're certainly paying attention to it. This also involves legal issues. For example, if someone like Riano creates his own NFT and a music NFT and distributes the revenue generated from its distribution, this would definitely violate the law. However, in Japan, such a model is being tested, which is very clear to users.

Even if you own someone's music, music itself is meant to spread, so it needs to spread. It's a little different from the NFT concept of someone exclusively owning it, but if revenue is generated from it, then it's shifting towards the idea of ​​us, as influencers, spreading the music ourselves. That's the kind of thing that's coming out now because we're doing it overseas. It would be interesting if the Japanese gold medal law also changes, I see. oftheMusic, yes, in the case of music, it would be like the amount played is automatically returned to the people involved, which is probably the most ideal.

For example, like decentralized YouTube, when you make a clip on YouTube, the money goes to the original creator, and it's probably something like that, but rather a decentralized, automatic distribution that really goes all the way around, I think that's probably the ideal, I'm sure. That's right. However, the moment you get people to buy an NFT, it falls under the category of investment, and the structure itself, where the person who holds it gets money when music sells, is where it gets caught up with the gold medal law. Of course, if there were no NFT, as you said, they could just receive the distribution, but the multiplication is a bit difficult. [Music] I'd also like to comment on that point, but right now, if you have some kind of token, that token I agree that if the profits earned are distributed, it would violate the Financial Instruments and Exchange Act.

However, the question is what kind of prohibition law exists, and it is because of consumer protection and the current situation where various scams are occurring. So, what's important is whether there is a real demand for a share of the works of the artists you support, if there is a share of the profits, and if there is, then I think that efforts will be made in the long run to gradually adjust the regulations to adapt to the new situation. So, I think it's very important that there is a market and demand, and just being able to confirm that made today's discussion very valuable to me. [Music] Thank you. Also, I have a question for Mr.

Hata. Yesterday, I actually bought the asset Semirion Arthur and thought, "So this is what it's like." I think everyone in the audience would like to know the answer. I suppose so, but are there any plans to extend this NFT framework to other Square Enix IPs, such as Dragon Quest or Final Fantasy? It's the question I get asked most often, and even our corporate team has told me not to ask it, but I have discussed it with the members of the business division, and the point is that now that NFT and blockchain technology has emerged, we should first consider whether Final Fantasy and Dragon Quest are a good fit for it.

How should I put it? When we eventually put such IPs on top of this business, if customers are already very familiar with blockchain and NFTs and there is a demand for them, then of course we can consider it, but it's not like we can just jump straight to putting Dragon Quest or Final Fantasy on it. We have actually announced products like that, we have announced NFTs using Final Fantasy, but we have received quite a few negative comments, and game users are not that familiar with them yet. I understand that it's because there isn't any. Related to that, well, what should I say, in terms of games, there are companies and groups that are actively trying to incorporate blockchain, and then there are those who are completely saying, "Stay away from us," and I think the world is quite divided.

From this perspective, there are criticisms that the fun will simply be replaced by something like money, and that it will no longer be a game. What are your thoughts on this blockchain- welcoming side and the audience side, Mr. Hata? Well, yes, the concept of the asset value Million Answer, the digital sticker I mentioned earlier, is similar to the stickers that were inside candy when I was little. The corporation has told us not to use names like that, so I made them with names like " Something Man" or "Something Man" because they were quite familiar to me, but when you digitize them, if you use blockchain technology, they will remain in everyone's hands as digital assets, and you can even use them on a marketplace.

We're creating this because we thought it would be fun to create an experience where people can buy and sell things. There are people who are negative about blockchain, but I think that's because they've gone too far with using blockchain for frivolous purposes. We are concerned about the increase in such businesses, so we are working with the sole aim of proposing to the world that there are interesting experiences that can be had using blockchain. Also, a game will be released next week that everyone can easily play in their browser, and you don't even need to own an NFT to play it. I've been doing a lot of interviews like this recently, and one thing I always say is that while I want people to play games like the ones we've made so far, I also want people who have never played games to play it.

What kind of people? Well, it's free, and you can play and create digital stickers, and then you can put them on the market and earn money, for example, 100 or 200 yen. We've prepared an experience for you to try, so please give it a go. It's kind of like point-collecting activities, or " point activities" as they're called in Japan, like at malls and such. It's like, you get 1 point for going there, and I think a lot of housewives do that kind of thing.

If you can have that kind of experience in a game, and it's free, I think people might be a little interested, and that's a good place to start. It's not that we want to make a lot of money, but we are providing a new experience with blockchain, so we just want people to try it out, and that's why we're making it free. That's the only thing we're doing, so I do n't have any PSO friends. What I think is that, basically, to put it another way, the block mechanism is pretty much left to its own devices, so if something goes wrong, for example, there will be a huge difference between people who sell a lot and people who don't sell a lot. And as Mr.

Sugihara said earlier, community, to put it another way, means managing it to a certain extent so that it gets exciting. So, ultimately, when you turn it into a service, some level of management is necessary, but at the same time, you want people to do things freely around the blockchain and within the mechanism, so what are your thoughts on the balance between management and how to effectively influence it? Technology Meets Off-the-Scenes [Music] That's right, I was just talking to Had about it off-the-cine, and when we talk about communities, Web3 communities are like fan clubs in music, and fan clubs are inherently one-sided. So, in terms of sending out information to fans, with Web3 communities, each and every member has an operational perspective, and I think that's a big point, something unprecedented. When it comes to making that function, for example, people in the music industry have never done anything like that before, so they don't really understand it intuitively.

They think they have to prepare everything and keep everyone entertained all the time, but that's not the case. If everyone is sharing the assets, then let's all get excited together. This kind of facilitation is something that's difficult to make function well, and I think there's still a big gap in understanding. But the most important thing is how well you can get the people in the community to have an operational perspective and work together towards the same goal. One of the points I think we need to work on within the project, like whether we can become a team.

[Music] Okay, well, our time is up, so this concludes the panel tour. Thank you very much. Thank you very much.