At this year’s Academy Awards, Inocente became the first Kickstarter-funded film to win an Oscar (for best documentary short). Around 10% of the films accepted by the Sundance, Tribeca, and South by Southwest film festivals were funded using Kickstarter. And several weeks ago, a high profile Kickstarter campaign was launched to fund a movie version of UPN/The CW television series Veronica Mars. The goal of $2 million dollars was reached within the day, record breaking both in its quickness and the amount of money raised. As I write this, the total amount has surpassed $4 million. The attention on Kickstarter these days struck me as significant in the current production landscape, and I set out to write a post on new trends in production financing. Almost as quickly as the Veronica Mars Kickstarter campaign succeeded in its goal, my colleague Myles McNutt published a post that addressed what this campaign might mean for teaching fan cultures in the future and suggested that perhaps participating in a Kickstarter campaign might be more about being involved in the experience of a project’s creation, being a part of the journey, than the final product. While the topic of this specific Kickstarter campaign has been widely discussed, I’m curious how it relates to broader trends in production financing.

Although people who give money to projects on Kickstarter do so in order to create a final product, the idea that Kickstarter provides donors with access to the experience of the production process is an important aspect of donating. Looking at Veronica Mars as an example, the incentives for donating include email updates throughout the production process and a copy of the final shooting script. These engage donors with the process of filmmaking; indeed, part of Kickstarter’s appeal and success seems to come from the fact that people enjoy feeling like they’re part of the action. The campaign also just announced that it would offer email updates for the $1 tier donors (lowering the barrier for people to get involved) in an attempt to bring an even larger number of people into the project and break the record for number of backers. Financing a project through upfront, donated funds differs from traditional funding methods (where production cash is often borrowed and repaid after the release of the product and subsequent earnings). We have yet to see how big budget projects will be affected by receiving up front financing with no need to repay loans (although it should be mentioned that a large production like the Veronica Mars movie could be budgeted at much higher than $4-5 million, depending on the discretion of producer Warner Bros.). With Veronica Mars, people who contribute more than $35 receive a digital copy of the movie, and therefore will likely not pay to purchase it after the film is completed. Since they have a copy of the movie at the time of its release, it is also questionable whether some of them will skip the theatrical release and just watch their own copy, potentially cutting into future profits.

The concept of grassroots fundraising is by no means new. In my own area of study, independent LGBT films and filmmaking, I know of numerous instances where filmmakers raised money from friends, family, and others who were dedicated to seeing alternative images than those offered in Hollywood films. Nicole Conn, for instance, raised money for her 1992 film Claire of the Moon by finding lesbian backers who were interested in creating a film that was made by and for lesbians. The lack of lesbian images in film at the time inspired people to give money and create their own images. Conn is an interesting example in this context because she funded her most recent film, A Perfect Ending, in part through a Kickstarter campaign. Using the same foundation, grassroots financing from a fan base dedicated to creating more lesbian images in film, Conn has updated her methods to make the most of emerging technological opportunities.

This idea of user supported media extends beyond Kickstarter and other particular fundraising practices. Emerging digital distribution models can offer another area of direct audience support and participation. Again pulling from my own area of study, niche marketing sites such as BuskFilms offer audiences around the world the chance to support filmmakers more directly. This site offers a large selection of lesbian films (and is expanding into the full range of LGBT films) available for streaming rentals. Unlike larger distribution companies that have high overhead costs, BuskFilms is able to give a larger percentage of rental fees directly back to filmmakers who can then re-invest the money in future production projects. Similar to the process of grassroots fundraising, this model of distribution allows for greater audience participation in supporting filmmaking projects.

User supported distribution models are not limited to film. To give another example, this time outside my area of study, the Cultural Capital project (or CultCap) focuses on resolving the difference between the music industry and cultural music consumption by creating an online, non-profit patronage system and social network that uses an adaptive “algorithm to allocate equitable compensation via micropayment.” By eliminating middlemen and gatekeepers, the site would in theory fund musicians through fan engagement. Although the site is in a theoretical rather than functional state at the moment, the drive behind the site’s linking of fans/consumers with artists/creators of content reflects the same impulse of Kickstarter and Buskfilms.

Taken together, these examples suggest both a desire for users to play a more direct role in production of media projects that they feel passionately about and the potential that technological advancements and internet connectivity can offer the industry. I do not mean to imply that utopian ideals of directly user-funded and supported content will imminently wipe out established modes of production, although the success of the Veronica Mars Kickstarter might tempt studios to engage with “pre-selling” future projects. People invest in media production every time they pay for media (whether through buying a movie ticket, downloading a song through iTunes, paying for a cable subscription, etc). However, the concept of putting in this money before or during production, or paying media makers more directly, carries significantly different connotations. While some have speculated on the effects Kickstarter might have on the future of filmmaking, only time will tell how these shifting models of funding and distribution will affect established modes of media production.

In 2008, after some substantial acquisitions on the European television audience measurement front, Nielsen proudly informed its clients that it now controlled three quarters of the world’s television currency data.  But again, traditional television ratings represent only the tip of the iceberg for a company that is also a primary source of information about video sales (Nielsen VideoScan), book sales (Nielsen BookScan), video game sales (Nielsen Games), music consumption (Nielsen SoundScan), newspaper audiences (Scarborough Research), mobile device usage (Nielsen Mobile Media) and Web traffic (Nielsen NetRatings).  Nielsen has even begun competing head to head with Arbitron in the measurement of radio audiences (Nielsen Radio Audience Measurement).

And yet there remain many more media audiences – or at least aspects of these audiences –  to capture.  Today, Nielsen’s growth involves expansion across three dimensions.  The first is geographic.  For instance, Nielsen now provides television audience data in over 30 countries around the world.  The company’s NetRatings service has established panels and site-centric measurement systems in countries around the world, to the extent that Nielsen now claims to monitor 90 percent of global Internet activity.

The second dimension involves expansion across platforms.  One of Nielsen’s most significant ongoing initiatives is the development of its Anytime, Anywhere Media Measurement (A2/M2) system, which seeks to provide comprehensive audience data integrated across the “three screens” (television, computer, mobile device) by which the bulk of electronic media consumption takes place.  Nielsen also measures audiences for what it calls the “fourth screen” – location-based video outlets such as those found in health clubs, bars, gas stations, and elevators. As new media platforms enter the mediascape, Nielsen is there.

And the third, and perhaps least discussed, involves expansion across the criteria by which audiences are valued.  That is, today, buying media audiences has become about much more than simply buying audience exposure. Data on the size and demographics of the audience that consumed a particular piece of media content represent only scratches the surface of audience understanding in today’s rapidly changing media environment.  Today, advertisers and marketers also want information about how engaged those audiences were, how well they recalled what they consumed, and how their behaviors were affected (to name just a few of the emerging currencies).

Nielsen is continuing to expand to meet these demands as well.  For instance, Nielsen recently invested in a firm called NeuroFocus, which specializes in applying brainwaves research to the analysis of advertising and content effectiveness.  And just this month, Nielsen acquired an online audience measurement firm called GlanceGuide, whose primary product is an “attentiveness score” for online video content.  Nielsen IAG measures the extent to which television audiences recall the details of the programs they watched.  And Nielsen BuzzMetrics measures how much online conversation is taking place about various media products – both in advance of and after they are released.

The obvious question that arises from this scenario is whether it is a good or a bad thing for one firm to play such a dominant role in the construction of media audiences.  Even Congress has looked into this question.  I’m not going to try to answer the question of whether this situation is good or bad.  It’s too big a question to try to answer here. But what I will say is that this situation may very well be inevitable.  Media companies and advertisers hate uncertainty, and what a sole audience measurement service provides is a bit less uncertainty. Competing providers means competing – often contradictory – numbers.  And such contradictions equal uncertainty.  This isn’t to say that Nielsen’s numbers are necessarily right.  But as long as everyone involved chooses to treat them as right, uncertainty is reduced.  Such are the somewhat bizarre machinations of the audience marketplace.