Contents Protocol ICO Review – Decentralized Content Exchange Protocol - Crush Crypto

Contents Protocol ICO Review – Decentralized Content Exchange Protocol

Summary

Video summary (video is 6:53 long):

Project Overview

What does the company/project do?

Contents Protocol is a content exchange protocol on which Content Providers, Platform, and Users can sustainably coexist and cooperate.

The current traditional platforms enjoy strong growth due to users consuming the content produced by content creators. However, content creators only receive a small portion of the income that the platform earns. There’s also a lack of transparency in which the revenue is distributed to different stakeholders.

Contents Protocol try to change that by distributing over 75% of the total license fee to the content creators. The platform will only keep 5-10% of the total income, with the rest being distributed to users who consume the content. This way, all the stakeholders benefit from the growth of the ecosystem.

The image below shows how Contents Protocol works in a nutshell:

Contents Protocol

The project will be providing fiat support to aid in adoption early on, with a portion of content sales from the user being converted into CPT tokens.

Below is an interview with Content Protocol’s Global Business Developer, John Kim:

How advanced is the project?

WATCHA is the company behind Contents Protocol. WATCHA, Inc. has been operating WATCHA, WATCHA PLAY, WATCHA MUSIC, and WATCHA WEBTOON for 6 years in Korea and Japan and currently has 3.8 million members.

It has also been awarded the "Best App of the Year" by either Apple or Google in each of the years since 2013. Users of the platform on average watch 18 hours of content per month. The app was awarded AppAnnie’s '2017 Top Apps Revenue in KR' for WATCHA PLAY’s ranking - No.19 for the combined total revenue on Apple App Store and Google Play.

WATCHA has licensing deals with 50 content providers including HBO, Disney, Sony Pictures, Fox Network, BBC, and others.

The first platform that integrates with Contents Protocol will be Watcha TV, which is going to be a transactional VOD (video on demand) service in Korea.

The content platform itself is still under development, but there is an agreement between them and WATCHA, an app with a rating of 4.7 and has 3.8 million users. On average, each user has provided 100 content rankings.

Their roadmap is as follows:

Q3 2018 - Transactional VOD service with WATCHA and 3rd parties.
Q4 2018 - Subscription based VOD
Q1 2019 - Subscription to Music Service
Q2 2019 - Transactional Webtoon/Novel Service
Q3 2019 - Transactional E-Book Service
Q4 2019 - Integrated Subscription Service

Below is an image showing a glimpse of how incentivization works in the app:

CPT User Incentivization
What are the tokens used for and how can token value appreciate?

The tokens will have several functions on the platform. There will be two different tokens (CPT and CP Power) comprising the network.

The two tokens will be convertible at a 1:1 ratio, with the CPT tokens being immediately transferable to CP Power tokens. However, there will be a 4-week lockup period for conversions from CP Power to CPT tokens.

CPT tokens will be used as the transferable, payments token which will be able to be traded on exchanges, used (1) as payment for content creators, and (2) to purchase content by the users. It will also be used as payout to users for their contributions to the network (i.e. referrals, reviews, etc).

CP Powers will be used as a network staking token, and cannot be directly sold. When staked, it can provide various benefits to the users and content creators, such as free advertising, and boosting payouts to users for their network contributions.

The image below shows the distribution breakdown of revenue generated on the Contents Protocol:

Contents Protocol

The more CPT tokens are converted into CP Power, the less circulating supply there will be for CPT tokens. More users/content providers will stake CP Power if they derive real benefits from doing so, which generally happens when there is more content and usage of the Contents Protocol platform.

Therefore, the more usage and content the platform has, the more users will want to hold onto CP Power tokens, and the more valuable CPT tokens should be.

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Team

There are total of 34 team members with the following being the core:

Taehoon Park, CEO and co-founder – the CEO of WATCHA since 2011. Previously game programmer at Nexon.

Alex Jihyun Won, COO and co-founder – COO of WATCHA since 2011. Previously Co-Founder at Onepiece.

Teddy Taehyun Lee, Lead Mobile Developer - Has a degree in electrical engineering, and was a developer on MapleStory for the Taiwan and HK branches.

Buzz Insoo Jung, Lead Backend Developer - Degree in electrical engineering, and 13 years’ experience in server developer positions.

The team also has a suite of advisors including Teddy Zee, Former EVP of Columbia Pictures and SVP or Paramount Pictures, Simon Kim, CEO of Hashed, Shuan Djie, Co-founder of DigixGlobal, Lim Hong Zhuang, CEO of XSQ, Jun Kim, Partner of Kakao Ventures, and more.

Investors of the project include Hashed, Kakao Ventures, and XSQ.


Opportunities

  • Users will be able to earn tokens for performing actions on the platform (rating, sharing, etc.), something that they cannot do prior to the shift to blockchain. This may actually attract more users to use the platform.
  • WATCHA is an established company with a large market share in the Korean VOD market. Very few blockchain projects have this kind of adoption right off the bat.
  • The VOD market is large and rapidly growing. According to PricewaterhouseCoopers, the global VOD market grew by 3.5 times from 2012 to 2017 and reached $22.3 billion.
  • The staking mechanism for both users and content providers would encourage holding of the CP Power tokens, effectively reducing the circulating supply of CPT tokens and creating a support for token prices.

Concerns

  • The introduction of cryptocurrency, especially the two-token system that involves staking and voting, may affect the some users’ experience on the platform.
  • Initially, only WATCHA TV will be integrated with Contents Protocol. More platforms will be integrated further down the road.

Conclusion

Our thoughts of the tokens for short term and long term are as follows:

For short-term holding: A

The token metrics are reasonable with somewhat long lockup for presale participants. With the strong and growing user base of WATCHA, we believe there should be plenty of unmet demand after the tokens are tradable.

For long-term holding: A

The target users for Contents Protocol are the content consumers and producers, which are mostly millennial from South Korea and Japan. They are the most receptive of the use of cryptocurrency. Coupled with the large user base of WATCHA, we believe that Contents Protocol has a good chance to succeed.

Disclosure: We have a position in this project.


For more information about the ICO, please visit the following links:

* The information contained in this article is for education purpose only and not financial advice. Do your own research before making any investment decisions.

This article is contributed by Victor Lai with the help of our intern John Coburn.

​Our rating system is based on 5 tiers: S/A/B/C/D, with S being the highest and D being the lowest rating.

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