Why not copy YouTube’s good idea?
This article is part of the On Tech newsletter. Here is a collection of past columns.
This week, On Tech will examine the economics of what is sometimes referred to as the internet creator economy. There are people who are so good at creating entertainment or information online that they try to make a job out of it. your favorite comedian on instagram, plant forager on TikTokWhere YouTube Stuntman are creators.
Some of you might be thinking: This is a job? He is. These online professionals are testing the Internet’s promise of enabling anyone to earn a living through creative pursuits. We’re entertained by the work of creators, and they influence what we buy, the music we listen to, and how products are promoted.
Internet professionals are also spearheading what works and what doesn’t in digital life as we know it. More and more creators are now saying they want a chance to share the riches of online businesses – and we should listen.
Let me back down.
We mainly work for free on the Internet.
There’s no Facebook, Instagram, YouTube, TikTok or Reddit without the gardening posts, memes and groups we voluntarily create. Some people have found ways to make money from online popularity, including sell goodsgetting paid by their fans and signing promotional offers outside of major websites.
But shouldn’t all online stars – and perhaps the rest of us who post online too – share in the wealth of internet businesses?
YouTube found a way. Since 2007, Google’s site has been selling ads on YouTube and paying more than half of the money to people who make videos once they reach a certain amount. level of popularity. When YouTube makes more money, so do these videographers.
Other companies, including Facebook and the streaming site Tic, cut advertising dollars for a small number of videographers. But YouTube remains the only major digital service that consistently redistributes much of its revenue to the people who make its products.
Last week, popular internet personality Hank Green make a video which compares what it gets paid on YouTube (good) to what it gets paid on TikTok (not so good), which has a shared lump sum for creators that the company distributes according to a complex formula.
Green’s point was that as TikTok earns more, creators actually earn a smaller share of what the company brings in. Implicit in his video was a question of why more companies aren’t doing what YouTube is doing and sharing a significant chunk of their ad revenue.
Every internet company now says creators are key to entertaining and retaining users, and they’re trying to make it easier for fans have to pay the creators or buy their products.
All of this is potentially useful. But Internet companies largely make money from advertisements. Green imagines creators coming together to push more of these companies to share their advertising dollars directly with the people who keep their virtual shelves stocked. It could create a healthier, more resilient life online for all of us, and better jobs for people trying to make a living from working online.
“There’s a business case to be made for revenue sharing and there’s also a business case,” Green told me.
Green in his video pointed out that because YouTube ads run in most videos, it’s easier for YouTube to distribute advertising dollars among creators. It would be harder for TikTok, Instagram, or other sites that don’t use ads in the same way. YouTube’s revenue-sharing model is also an option only for popular video creators.
Green knows that YouTube-style revenue sharing won’t be a panacea for everything that’s wrong with the internet. And like any labor force, not all creators want the same thing. Some agreed with Green that YouTube-style revenue sharing is a good way for them to make a more stable and sustainable living. Others said they preferred TikTok’s fund for creators or Twitch’s ways to let people earn money from live-streamed videos.
The investor Li Jin told me that the best path to healthy digital economies is not for internet companies to redistribute their income differently, but for them to annihilate the absolute power of corporations over creative work online.
There’s also a financial mercenary argument: why would a company give up money if it didn’t have to? There will always be hungry youngsters who are happy to do stuff online for nothing.
But this is a time when the established norms of the internet are challenged. Let’s extend this to the economics of who gets paid, and for what, to keep the internet fun and useful for all of us.
Coming Wednesday: Apple’s app commissions erode creator revenue. And Thursday: How an online personality makes money from digital work in a thousand different ways.
Hugs to that
This Great horned owl keeps its egg warm in windy weather. (Those ear tufts blowing in the wind are just too much.)