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This is all good an true. But of the two Youtubers I got to talk to at the series finale of MakerFaire in San Mateo, they both whined that advertising rates wer

This is all good an true. But of the two Youtubers I got to talk to at the series finale of MakerFaire in San Mateo, they both whined that advertising rates were going down. The goal of my discussion was to talk to someone who had "been there, done that" to get an idea of the time investment and the expected returns. If they want to out themselves here they can. Independently they both have pretty robust tracking software to understand views, view time, clicks from views Etc[1]. Both have systems to measure $/views, and both used extensive "channelizing" to get focused on where the views came from and how their viewer found them. They both observed that if they had been "TV shows", as their ratings and viewer audience expanded their network would get more ad revenue per show, but for them they are consistently getting LESS and less revenue. It puts them on a treadmill of having to produce more videos to get more views to keep their revenue up but that also increases their costs. It resonated pretty strongly with my experience with AdSense and web pages. We can speculate on why that trend is where it is, but it seems pretty clear that one (or maybe both) things are true; Advertisers don't see as much "value" in advertising on Youtube videos, and the revenue growth curve for at least these two content producers does not seem to match either the slope or the magnitude of the change in revenue that Google reports in its earnings. [1] I got a good idea of how difficult this path could be when you are your own producer, accountant, and data science company.

busterarm 7y ago
The YouTube treadmill has creators pushing out 1-4 videos per day now. There is now a near-infinite supply of YouTube content. OF COURSE the advertising rates are approaching zero. With TV there's only a fixed number of channels & timeslots. Content creators are complaining about YouTube being strict but YouTube is strongly incentivized here to cut the supply of content. They want to raise advertising rates and charge advertisers more money! That means raising the bar of production value, etc, because YouTube wants to keep the same kind of viewership numbers. YouTube is now mainstream television. The channels that will survive here are going to play ball and raise the quality of their content and production values. They're going to be family safe. They're going to provide lots of content and it's going to be shot multi-camera by a staff of people. Smaller creators days on the platform are numbered. Thing is, the channels that do this best can do this for themselves. They don't need YouTube if they build a dedicated-enough audience. I've been looking at how to make this process easier for people, using things like Cloudflare Stream, and think there may be some business opportunity here.
- IfIEverCatchYou 7y ago
  > There is now a near-infinite supply of YouTube content. OF COURSE the advertising rates are approaching zero. This doesn't make sense to me. The advertising rates are a connection between the advertiser and the consumer. If the content scales to infinity, there's still the same number of consumers that advertising dollars compete for regardless of available content. > The channels that will survive here are going to play ball and raise the quality of their content and production values. They're going to be family safe. They're going to provide lots of content and it's going to be shot multi-camera by a staff of people. Smaller creators days on the platform are numbered. > Thing is, the channels that do this best can do this for themselves. They don't need YouTube if they build a dedicated-enough audience. Then that leaves room for the smaller creators.
  - busterarm 7y ago
    > This doesn't make sense to me. The advertising rates are a connection between the advertiser and the consumer. If the content scales to infinity, there's still the same number of consumers that advertising dollars compete for regardless of available content. The advertiser has a set budget and is looking at a supply of content. If there's a fixed supply of avenues to reach their customers, then they have to bid against lots of other advertisers to reach those customers. The rate to advertise goes up. If the supply of avenues to reach customers is near infinite, then the cost to reach those customers is almost nothing because there's no market driving up the cost of advertising. It doesn't make sense to spend more money to reach those customers. Reaching customers is cheap and easy. This is Supply & Demand 101. In terrestrial advertising, there's only a small number of advertising slots that are valuable because that content is gated by place & time. This is not true online (caveat, read below). (caveat explanation) Okay, I lied: It actually is really valuable. Joe Rogan's advertising slots are _extremely valuable_ and he uses them to to advertise businesses he has a partial ownership stake in (Onnit), which is brilliant. This is the same shit the Zuffa brothers did with the UFC & Xyience and it put millions upon millions of dollars in their pockets. But that's not advertisers paying for those slots, that's pocket A paying pocket B...and as a regular advertiser you can't buy that slot! PewDiePie is probably making a small fortune off G Fuel, those chairs, and his phone games. These are the smart content creators today. Everyone relying on YouTube or Twitch partner programs for monetization is just on the dole or will be. If you're a content creator with a reasonable following and not on a 2-3 year plan for productizing your brand, you're on a path to insolvency. > Then that leaves room for the smaller creators. Not on YouTube. And video hosting with a global CDN costs money and requires some know-how.
toper-centage 7y ago
Advertising rates are way down because less companies are paying. Ads are sold in auctions and if there is less competition for ad space, cost per view and per click naturally go down.

busterarm 7y ago

The YouTube treadmill has creators pushing out 1-4 videos per day now. There is now a near-infinite supply of YouTube content. OF COURSE the advertising rates are approaching zero. With TV there's only a fixed number of channels & timeslots. Content creators are complaining about YouTube being strict but YouTube is strongly incentivized here to cut the supply of content. They want to raise advertising rates and charge advertisers more money! That means raising the bar of production value, etc, because YouTube wants to keep the same kind of viewership numbers. YouTube is now mainstream television. The channels that will survive here are going to play ball and raise the quality of their content and production values. They're going to be family safe. They're going to provide lots of content and it's going to be shot multi-camera by a staff of people. Smaller creators days on the platform are numbered. Thing is, the channels that do this best can do this for themselves. They don't need YouTube if they build a dedicated-enough audience. I've been looking at how to make this process easier for people, using things like Cloudflare Stream, and think there may be some business opportunity here.

IfIEverCatchYou 7y ago
> There is now a near-infinite supply of YouTube content. OF COURSE the advertising rates are approaching zero. This doesn't make sense to me. The advertising rates are a connection between the advertiser and the consumer. If the content scales to infinity, there's still the same number of consumers that advertising dollars compete for regardless of available content. > The channels that will survive here are going to play ball and raise the quality of their content and production values. They're going to be family safe. They're going to provide lots of content and it's going to be shot multi-camera by a staff of people. Smaller creators days on the platform are numbered. > Thing is, the channels that do this best can do this for themselves. They don't need YouTube if they build a dedicated-enough audience. Then that leaves room for the smaller creators.
- busterarm 7y ago
  > This doesn't make sense to me. The advertising rates are a connection between the advertiser and the consumer. If the content scales to infinity, there's still the same number of consumers that advertising dollars compete for regardless of available content. The advertiser has a set budget and is looking at a supply of content. If there's a fixed supply of avenues to reach their customers, then they have to bid against lots of other advertisers to reach those customers. The rate to advertise goes up. If the supply of avenues to reach customers is near infinite, then the cost to reach those customers is almost nothing because there's no market driving up the cost of advertising. It doesn't make sense to spend more money to reach those customers. Reaching customers is cheap and easy. This is Supply & Demand 101. In terrestrial advertising, there's only a small number of advertising slots that are valuable because that content is gated by place & time. This is not true online (caveat, read below). (caveat explanation) Okay, I lied: It actually is really valuable. Joe Rogan's advertising slots are _extremely valuable_ and he uses them to to advertise businesses he has a partial ownership stake in (Onnit), which is brilliant. This is the same shit the Zuffa brothers did with the UFC & Xyience and it put millions upon millions of dollars in their pockets. But that's not advertisers paying for those slots, that's pocket A paying pocket B...and as a regular advertiser you can't buy that slot! PewDiePie is probably making a small fortune off G Fuel, those chairs, and his phone games. These are the smart content creators today. Everyone relying on YouTube or Twitch partner programs for monetization is just on the dole or will be. If you're a content creator with a reasonable following and not on a 2-3 year plan for productizing your brand, you're on a path to insolvency. > Then that leaves room for the smaller creators. Not on YouTube. And video hosting with a global CDN costs money and requires some know-how.

toper-centage 7y ago

Advertising rates are way down because less companies are paying. Ads are sold in auctions and if there is less competition for ad space, cost per view and per click naturally go down.