Let's go straight to the point and end that suspens now: a NFT is 'just' an entry in a database, ie a unique ID and the reference to the wallet address that owns it.
Well, and then you may ask: "That's it?", to which the answer would be "Technically speaking, yes almost!"
If we look at the most proeminent NFT environment, which is to date Ethereum, a NFT collection is a Smart Contract that should implement ERC721 standard (in simple words, it's a 'software' that will execute on the blockchain and must define a little set of mandatory functions) among which the ability to know the owner of a NFT (aka token) and to transfer it to another one... And that's pretty much it.
What about my ape pix?
That is why a ERC721Metadata extension exists and adds the ability to request for a token's URI that points to where data corresponding to that token can be found.
So when you're buying a NFT, you don't buy an image or a video, but you buy an ID in a Smart Contract registry that can give information about some numerical data linked to it, ie the media you wanted to get in the first place.
What do I own?
This leaves us with remaining questions:
- Do I own the underlying data/media
- What about intellectual property as we're living in a digital world where anything can be fully copied
To which the anwser might be "read the instructions" (aka as Terms and Conditions), you know, the little lines often written at the end of a contract and that we all accept blindly, being too lazy to read... that's where everything lies about!
So you might end up saying "at the end, I buy nothing?" and I would answer "yes... and no". You buy a record on a ledger that 'cannot' be falcified and that can securly be transfered.
And when there is a common agreement on the value of the collection you're jumping in, that's the only thing that matters at the end of the day! (Always remember that gold is 'just' a piece of metal that everybody gives value to, whereas it could have been shellfishs or tulip bulbs...).
One more thing...
You might have already read this before, but if not, I can't leave you without telling you what NFT stands for: Non-Fungible Token.
We've already seen that a token can be considered as a unique record of data. And Non-Fungible just means that two tokens will never be equivalent or interchangeable. Even sharing the exact same data, token A en token B will always be considered different and live their own life, have their proper identification and so value (think about twins).