PAID TO PLAY
Social platforms are spending insane amounts to attract and retain creators and it gives us a clue into what the future holds for the internet.
WHO IS SPENDING WHAT
- Twitter has launched Revue, will monetise Spaces, has recently announced a subscription service and bought Scroll (a service charging users to access free content without the advertising).
- Youtube announced a $100 million dollar fund to pay content creators on Youtube Shorts, a platform only available in the US and India. They have paid out $30 billion in 3 years to creators to date.
- Snapchat Spotlight is paying $1 million daily since November last year.
- TikTok recently expanded its fund for US creators to $1 billion over three years.
INVESTMENTS, NOT EXPENSES
In its first iteration the web was sponsored by advertisers. Just like TV and Radio. Developers built the platforms, users were the commodity, and brands paid to reach their desired audience. This sounds bad for your average net citizen, but it isn’t. In future iterations, platforms will be the interface between users and creators, and make money as middlemen. Creators of content are the key to the next phase of the online environment. More specifically, their audiences are because they will ultimately fund the ecosystem.
The boom in subscription services like Substack, OnlyFans and Patreon are an intermediary phase between the two. The logistics of print publishing meant subscribers paid for content they did not want in order to get the portion they did. For online content this model will become redundant as accessibility and payment become more efficient, and it becomes cost effective to pick and choose whatever content you wish to consume. The needle on the great pendulum of convenience will swing from bundling to unbundling.
Platforms already know the hardest and costliest part of scaling is building a userbase, so they’re investing in audience retention by ensuring they have content worth sticking around for. They’re carrying the cost in the short term, until users are ready and willing to assume the burden. This also means we might see a decoupling between the social/community aspect and the entertainment aspect as platforms evolve to satisfy niche needs while integrating seamlessly with other services (a topic for another post).
As Jason Parham points out for Wired, every piece of the internet will soon come with a price tag. The good news is, you’ll know exactly what you’re paying, and what you’re getting.
brands must adapt accordingly
What space is left for brands in a world where every individual can customise their entertainment for an audience of one? In a very healthy place; what works for creators works equally for brands. Investing in great creative capable of holding attention and building equity. Which is what advertising should be doing anyway. The rules may get tweaked, but the game remains the same.