Seeing Red Over YouTube Changes
It’s been big news in the online video world and likely to completely change the way that we view videos online. If nothing else, it is going to completely change how one billion active monthly YouTube users are going to interact with the video sharing site. YouTube has recently announced that it is going to roll out a new paid-subscription service called YouTube Red.
It isn’t just viewers who are going to be affected by the announcement and new service. The video sharing company have laid out plans that will affect the revenue of people who use YouTube to make a living. How are these changes going to affect viewers and video producers?
What is YouTube Red?
YouTube Red is a subscription service where viewers will pay the video sharing giant $9.99 a month to watch their favourite videos without interruptions from adverts. According to YouTube, this is one of the main requests from their users. Certainly this is something that has long been asked for by the community. There are many articles online detailing how to stop adverts from appearing before and during videos.
However, even though Google added a feature on their Chrome Internet browser to help remove adverts from YouTube videos, there has been one group that were annoyed: Video producers. For awhile now there has been a growing group of individuals who use YouTube to earn a living. These vloggers were annoyed because when adverts didn’t show on their video they didn’t get paid.
What is YouTube Red Offering Video Producers?
The removal of adverts from videos is bound to cause a stir as vloggers will be worried about their income streams. That being said, YouTube did have a solution: Offering vloggers a chance to earn money from the subscription service. What YouTube have stated is that vloggers will earn money based on the percentage of views they get amongst the other videos watched. The money from this will come directly out of the subscription payments from viewers.
So, say there were two videos and one was watched 3 times and the other 2, the former would receive 60% of the funds from the pot, while the latter would get 40%. Of course this is done on a massive scale and YouTubers are likely to receive a small percentage but when the company is expected to generate billions from the service, the amount earned per vlogger is likely to be significant as well.
This isn’t the first scheme to run like this. Amazon Direct Publishing runs a very similar scheme where authors can enlist their titles in KPD Select and authors are paid based on the percentage of downloads their books accumulate. While successful for Amazon, authors have questioned if the scheme has been worth it.
Other examples are the subscription music service Spotify and Apple Music. Both of these use 70% and 71.5% respectively of their subscription revenues to pay content creators.
Are Viewers Going to be Happy?
YouTube viewers are going to be the ones that get the most benefit from the service. YouTube Red will be available across multiple devices and will include their recently launched gaming app and YouTube music.
As well as eliminating adverts from the video, the service promises to allow users to download videos and watch them later offline on their mobile devices. Finally, YouTube Red looks to go the way of so many film and television streaming services like Netflix and Amazon Prime by offering original shows and movies.
This will provide users with a lot more choice of what and how they watch while not annoying them with interruptions. YouTube have also stated that the free-to-use service is not going to be discontinued and users will still have the choice to use it if they prefer.
The problem comes when users are particularly interested in certain artists that have signed on to become YouTube partners. YouTubers like Lilly Singh or PewDiePie have reportedly signed on and their content will only be available to YouTube Red subscribers. So unless users subscribe, they will have to find new artists to follow.
It is also important to note that those who are using Apple to purchase the subscription will have to pay $12.99 per month to cover tax.
YouTubers are up in Arms
Those who produce content are more than a little annoyed. Some have even started petitions to see YouTube reverse its decision to roll out YouTube Red. The main concern is that those that have not signed on to the new Terms and Conditions of YouTube will not only be hidden from view from the YouTube Red subscribers but from the free version of the video sharing site as well. This could be devastating for those that are concerned about the new service and reluctant to see their revenues decline sharply.
Simply put, YouTubers who don’t want to change their career are going to have to sign up. According to YouTube, 99% of all video creators have already signed up to the new terms and conditions. However, this does leave 1%, which could be representative of some vloggers who exclusively earn a living off YouTube.
In addition, a change in the Terms and Conditions detailed that only 55% of the subscription revenue would be allocated to YouTube video creators. This is relatively low compared to other services like Spotify and Apple Music.
So it is no surprise that YouTubers are annoyed. Not only could their videos be removed from YouTube because they don’t want to sign up to new terms and conditions, but they face lower royalties from the service than other services. Also, video creators will have to share their revenues with game creators and music artists – something that is likely to infuriate many of them.
Yet for some YouTubers this could be a benefit. Those who have lost revenue from adverts being disabled by the Chrome extension or other pieces of software will find that they now have a new revenue stream.
YouTube Red is certainly sending shockwaves throughout the video sharing industry. However, while users are being promised the lucrative rewards of signing on, YouTube video creators aren’t looking forward to the new terms. Many are concerned that if they don’t sign on their videos will disappear and if they do sign on; their revenues will be diminished by a poor subscription revenue share scheme and the loss of advert income.
However, there are benefits for YouTube creators as well as they can now gain revenue from those who previously disabled adverts on videos. Also, YouTube Red offers users more opportunities to watch videos and so creators have higher chances of earning a download or watch – increasing their revenue.
How do you feel about YouTube Red? Are you a content creator worried about the new subscription service?