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Uploaded:2016-09-23
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Brand deals, adsense, merch, gigs, touring, patreon, books...there is so much value in online video, and we've had a really hard time converting it into dollars efficiently. Lots of YouTubers are able to support themselves, some even get rich, but most can only supplement their other projects and jobs with their YouTube related revenue. It may be that creators will need to move more into subscription-style content for higher budget endeavors.

But SciShow and Crash Course are safe and secure here on the YouTube platform. Both were designed with these systems in mind and have found a path to sustainability thanks to advertisers and our Patreon patrons.

Mentioned in this:
The Internet Creators Guild
http://internetcreatorsguild.com

Sexplanations
http://youtube.com/sexplanations

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Good morning, John.  At the very first VidCon, I was being interviewed by a television reporter who at one point, was surprised by something I said, and she said to me, "You can make money on YouTube?  How does that work?" And I was a little tired and I was also like super high on VidCon, I was so excited about online video and all the stuff that had come together and so, like, I did-- I did not censor myself well. I said something to the effect of, "Um, advertising. My show has more viewers than yours does".

Which I did not intend to be a sick burn.  It just came out, like that was the thing that was true.  But the answer to that question is complicated, and since I think about YouTube a lot, and I think that we should all be more open about how all of these things work.  Let's do it, let's talk about how YouTubers make their money. 

Different kinds of content have to have different kinds of support.  Like this right here, very low budget.  This is just two guys, we could probably subsist on what we call "AdSense and merch".  AdSense works for every YouTuber as long as you're not, like, philosophically opposed to advertising.  You click a little box when you upload your video, YouTube will sell an ad against it, and then it will split the revenue with you, you get fifty-five percent. 

This is kind of wonderful.  It is not common thing among social media sites though they have started to share some revenue.  YouTube started doing it way back in like 2007 and 2008.  It's also part of why it's such at appealing place to make stuff, and also part of why it's become harder to break in.  Because if there's a way to make money, then people will spend money to make their content look better so that they can compete on the platform. 

Anyway, YouTube AdSense pretty much stays at the same level and everybody has access to that, which is really amazing.  But at higher levels, you start talking about brand deals, maybe endorsement deals, maybe really good merch stuff, and even eventually getting support from someone else to help realize your vision.  Crash Course and SciShow were both funded by grants from YouTube because they wanted more high-quality stuff on the site so advertisers would be more likely to advertise. 

Those systems are really hard to democratize and make available to everybody.  Now brand deals are a little bit different.  They have started to be available to creators sort of in the middle class.  Brand deals, basically, anytime somebody pays you to talk about something in a video, whether that's like an audible.com call-out at the end, or it can be a big elaborate production and your entire video is about the topic that the brand wants you to talk about. 

YouTube advertising is available to everybody and it comes in and you don't have to worry about whether or not it's gonna come in, but...it's a really low rate.  In order to supplement income, a lot of YouTubers, in addition to having, you know, regular jobs, also live in Los Angeles, where it's easier to get gigs acting or hosting and TV commercials and shows.  And if you more social media followers these days, it can be easier to get that kind of work, which is interesting. 

Some YouTubers also make money by touring, whether they're comedians or musicians.  Sometimes creators will license their content to other platforms; sometimes videos go on TV and you can make some money that way.  And then you have some creators like Rooster Teeth, building their own subscription platforms.  And then if you don't want to make people subscribe, you can also ask them to subscribe through services like Patreon, which is extremely important for shows like Sexplanations, for example, that gets really bad YouTube ad rates because advertisers don't want to be next to the word "sex".  Without the support of Patreon patrons, that show couldn't happen at all. 

The thing to remember is that different kinds of content work better with different kinds of monetization.  Unlike what I said to that lady at VidCon 2010, it's not simple.  It's gotten a lot more difficult to make your way on this platform, and it has become more complicated, which is one of the reasons why I recently started a thing called the Internet Creators Guild, with the goal of being a resource to connect creators together, to give them information, and to let them have a unified voice when talking about when things go wrong and what they would like to make them happier. 

To be clear, I started this thing but I really don't want to run it.  I don't think that I should run it, and I definitely can't.  Honestly, I think that I'm too biased to be in charge, so I am looking forward to eventually stepping back after helping Laura Chernikoff, who's one of the most effective people I've ever met, get established as the executive director of the organization.  There is a lot of value that is created by online video, and as different systems evolve for capturing at least some of that value, it just gets more complicated. 

And as those barriers rise, we need to create systems that keep the benefits of this revolution accessible to the most people possible, and I hope that the Internet Creators Guild can play a part in that.  Thanks, everybody, for listening to this, hopefully it wasn't too inside baseball.  John, I'll see you on Tuesday.