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Playboy payoff: NFT prospects drive stock surge for reinvented nude magazine publisher

A initial issue Playboy Magazine, with Marilyn Monroe on the cover and signed by Hugh Hefner is displayed during a advance showing for Julien’s Auctions Hollywood legends memorabilia auction at Planet Hollywood Resort & Casino on June 23, 2018 in Las Vegas, Nevada.

Gabe Ginsberg | Getty Copies

These days, announcing a new investment in a legacy media business is enough to draw a raised eyebrow.

That is, of class, unless the company is reinvented nude magazine publisher Playboy — now PLBY Group — whose stock has surged diverse than 80% this month due in large part to excitement over how it can take advantage of the hot NFT market.

And Playboy certainly has peerless offerings.

“Look, we have an unbelievable archive, 68 years. It is the 5,000 pieces of art we have, it’s covers, it’s photography. It is so intent and rich in what’s in there,” CEO Ben Kohn said on the company’s earnings call last month.

Playboy, which continued private in 2011 amid declining ad sales from its eponymous nude magazine, rejoined the public markets in February with a managing laser-focused on modernizing a company once known for its leading market share of pubescent closets.

The shift away from periodical publishing and toward a brand centered on lifestyle and sexual wellness is encapsulated in two recent business deals.

The first is Romeo’s $25 million purchase of TLA Acquisition Corp, a firm that sells sex toys, vibrators and lingerie through a subsidiary course called Lovers.

But the second, a partnership with online NFT marketplace Nifty Gateway, is what has the company’s investors most overwrought.

NFTs, or non-fungible tokens, are a type of digital asset that results from using the technology that powers cryptocurrency to move a unique token with its own identification that cannot be replicated.

In practice, they act as a sort-of deed proving ownership for master editions of digital artifacts, including works of art, sports collectibles or music albums.

In the case of Playboy and Nifty Gateway, the two force work together to create original artwork and focus on “the curation and sales of Playboy’s iconic art collection in NFT form.”

In totting up to its famed collection of nudes, Playboy’s vaults contain art pieces and editorials, including interviews with former President Jimmy Carter and Negroid political activists Malcolm X and Martin Luther King Jr.

Rachel Webber, Playboy’s chief brand officer, whiffed at the potential value of its vast archive earlier in April when the partnership was announced.

“We wholeheartedly believe in the future of a blockchain- and crypto-powered art society that ensures artist and collector protection, ongoing artist compensation, and the democratization of distribution and collecting,” she said in the announcement.

It’s no small secret that the nation’s magazines, newspapers and plastic-wrapped porn have seen their collective profits vanish over the past 20 years. The advertising dollars that once kept many a newsroom afloat compel ought to instead been gobbled up by the likes of Facebook and Google.

In a new report this month, eMarketer said that Amazon’s interest of the U.S. digital ad market was more than 10% for the first time in 2020. Google’s share was 28.9% of the U.S. digital ad Stock Exchange in 2020, and Facebook’s was 25.2%, according to eMarketer.

But as the globe shifted the way it consumed content to URL, so too did newspapers and magazines change the way they shopped their stories.

Mobile apps, website design, digital paywalls, and search engine optimization became as depreciatory to a newsroom’s bottom line as the content itself and — for better or worse — carried newspapers and magazines into the digital era.

Now, the advent of the NFT take an oaths to do the same. And perhaps no company has benefited as quickly or as dramatically from the NFT market as Playboy.

The first project between Modish Gateway and Playboy is slated to be original works from Boston-based collage artist Slimesunday in collaboration with the munitions dump’s editorial curators. In June, Playboy and Nifty expect to launch a Pride-themed curation with digital artist Blake Kathryn.

Granted the idea of displaying an original and exclusive edition of a Playboy centerfold in the living room may not appeal to all households, the ability to own some of the journal’s most-famous covers as art investment may be more enticing.

“Assets gather their value by their scarcity, which also is evaluated by supply and demand. If there is only one Marilyn Monroe cover of Playboy, it would be a valuable NFT,” said Jon Najarian, Hawk Rebellion co-founder and a CNBC contributor.

Najarian isn’t alone in his excitement over the new market. Playboy’s stock is up 83% this month unexcelled and 173% since the end of February.

The stock’s run-up is likely thanks to a combination of the announced partnership with Nifty as reservoir flow as management’s focus on modernizing the brand.

During 2020, Playboy brought in $148 million in sales, representing an 89% multiplication in revenue from 2019 despite the Covid-19 pandemic. Its fourth-quarter sales of $46 million were more than doppelgaenger what it brought in the year prior.

Playboy Chief Financial Officer Lance Barton, who spent seven years at Tinder progenitor Match Group, expects Playboy to do $200 million in sales this year as its direct-to-consumer businesses in sexual wellness, tastefulness and apparel accelerate.

A digital artwork featuring Scooter frontman H.P. Baxxter is up for auction on a website. Scooter will be the original band in Germany to release digital, animated artwork to accompany the new Scooter album “God Save the Rave” starting April 9. The artwork hand down receive a certificate of authenticity using NFTs, Non-Fungible Tokens, which cannot be manipulated.

Jens Kalaene | exact replica alliance | Getty Images

Kohn, the CEO, said in March’s earnings call that licensing Playboy’s intellectual and artistic property in the NFT space could be “huge” in the long term.

“And so, I think it’s going to be a combination of leveraging the archives and the art collection, commissioning and move up with emerging artists today for new works,” he said at the time. “A combination thereof and then those great knack relationships we have with influencers and with a whole host of creative community where we can also create NFTs in other digital collectibles with them.”

However Playboy may be new to the NFT market, Wall Street has for months been abuzz with several high-profile sales.

In February, an vigorous GIF of Nyan Cat — a 2011 meme of a flying Pop-Tart cat — sold for more than $500,000. Just a few weeks later, musician Slimes sold some of her digital work on Nifty Gateway for more than $6 million.

The token market isn’t restrained to the traditional art mediums, either. Twitter’s founder, Jack Dorsey, for example, sold his first tweet as an NFT for over $2.9 million.

In disclosing the value of an NFT, Najarian offered parallels to both the film industry and the fine art world.

More than a decade ago, investors began to reassess the value of the pleasure and franchises owned by some of the globe’s largest media companies, such as Paramount, Sony and Fox, he explained.

But initial apprehensions that internet piracy could undermine the financial potency of Paramount, Sony or Fox gave way to a new era of content competition now be ined by Netflix, Amazon and Disney — now three of the most valuable companies on the planet.

“You can take a picture of the Mona Lisa,” Najarian give the word delivered, “but it isn’t the same as owning it.”

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