YouTube (YT) is the largest search engine in the world, second only to Google itself. With over 1 billion hours of content watched each day and over 300 hours of new content uploaded each minute, YouTube sits in the middle of a three-sided marketplace which serves creators, viewers, and advertisers (1). At the core of YouTube’s success is its community. Creators have been able to not only share their unique stories, but rally a worldwide audience.
From a monetary perspective, YT provides creators with 55% of ad revenues, while keeping the remainder for itself. While thresholds have changed over the years (from views to stricter criteria of watch time and subscribers) for which channels can qualify for its revenue-sharing Partners Program, creators continue to receive support from YT with 40% making over six figures on the platform (2). More importantly, YT allows creators to express their artistic voice. No longer is high quality content restricted to the upper echelons of major studios. The advent of prosumer cameras, editing software, sound equipment has empowered millions of creators, from the hills of LA to the heart of Indonesia, to share their perspectives and their stories. YT has pursued a long-tail strategy, picking up a wide variety of content types. At the upper end, YouTubers like Lindsey Sterling, Ryan Higa, and H3H3 have followings that rank in the tens of millions with millions tuning in each week to watch their content (3). Further down the tail, niche content ranging from unboxing to haul to DIY targets smaller, but more engaged audiences. By keeping the platform free and easy to use for both creators and audiences alike, YT continued to grow, aided by Google’s backing after the acquisition in 2006. Like Reddit and Twitch, YT communities are self-reinforcing with strong same-side and cross-side network effects. Creators collaborate with other creators both inside and outside the same content vertical. Fans can not only engage with other fans about their favorite youtuber, but also become content creators themselves. The clearest example of the intensity of fandom is VidCon. VidCon, a convention for creators and viewers, attracts over 30,000 people, most of whom fall in the Gen Z demographic and who see youtube and vine celebrities on par with A-list actors of traditional Hollywood (4).
The power of the YT model lies in the relatability and resonance between the creator and his/her audience. Core to this is authenticity and the ability of creators to connect to their audience. The challenges in today’s creative landscape is how to better monetize the creator base without alienating audiences. YouTube has introduced new products like YouTube Red and YouTube TV that put premium content behind a paywall. Failed startup Vessel tried to window content, charging audiences to view content during the first few days of release. However, these new products threaten the very core that made YT successful in the first place: the community. High production budgets, more creative overhead, and increased bureaucracy separates creators from the audience. In the standard YT model, the audience can comment, message, and like the videos, gaining direct contact with the creator. The management and arbitration of what content is valuable by a small group in headquarters seems anathema to the decentralized, “crowd votes” model that made YT successful in the first place. In 2017, YT experienced “adpocalypse” in which advertisers boycotted YT after finding some of their ads ran as pre-roll to offensive content. The pullback resulted in plummeting revenues for creators, some of whom had no connection to the offensive content (5). The question of adjudication, what constitutes “offensive content,” and who was in the proper position to decide were widely debated. Specifically, YT guidelines for “Not Advertiser Friendly” content includes categories like “sensitive social issues” and “tragedy and conflict” (5). With a good intention to bar those who incite extreme action from using the platform, the general language in the guidelines penalized any youtuber who even touched on controversial issues. With increasingly complex social issues, sensitivities, and rhetoric, the challenge for YT lies not in technical capability of backend streaming support, but maintenance and monetization of the dynamic creative drive that made YT so successful in the first place.
- 39 Fascinating and Incredible YouTube Statistics [Internet].; 2017 [updated Dec 12; cited March 24 2018]. Available from: https://www.brandwatch.com/blog/39-youtube-stats/.
- Additional Changes to the YouTube Partner Program (YPP) to Better Protect Creators [Internet].; 2018 [updated Jan 16,; ]. Available from: https://youtube-creators.googleblog.com/2018/01/additional-changes-to-youtube-partner.html.
- Most Subscribed
[Internet]. . Available from: https://socialblade.com/youtube/top/100/mostsubscribed.
- The VidCon Revolution Isn’t Coming. It’s Here. [Internet].; 2015 [updated July 31,; cited March 24 2018]. Available from: https://www.vanityfair.com/culture/2015/07/vidcon-2015.
- Can YouTube Survive the Adpocalypse? [Internet].: nymag.com; 2017 [updated Dec 28,; cited March 24 2018]. Available from: http://nymag.com/selectall/2017/12/can-youtube-survive-the-adpocalypse.html.