Cre­ators Inc.

YouTube’s mon­ey­mak­ers, here and in the US

The Australian - The Deal - - News - He­len Trinca

YouTube is a gi­ant plat­form for home-made video tal­ent, but the com­pany has long looked for ways to shape that cre­ativ­ity – even if ex­ec­u­tives in­sist it is a dis­tri­bu­tion net­work, not a pro­duc­tion house.

In 2011, YouTube’s de­ci­sion to in­vest in orig­i­nal chan­nels was seen as the first step to­wards Google TV. The ex­per­i­ment in ef­fect ended a cou­ple of years later and the fo­cus moved to phys­i­cal pro­duc­tion spa­ces to help the “am­a­teurs” make more so­phis­ti­cated con­tent. There are now YouTube Spa­ces in LA, Tokyo, Lon­don, Ber­lin, Paris, Sao Paulo, Mum­bai and New York where “cre­ators” can book time and equip­ment. So far they have gen­er­ated more than 10,000 videos. Last month saw the re­lease in the US of movie-length YouTube “Orig­i­nals” avail­able only on its sub­scrip­tion arm, Red.

In the end, the strength of con­tent rests on the cre­ators who have in­vented gen­res: the beauty-blog­ger, the gamer, the DIY tradie. Per­pe­tra­tors of good and crazy ideas have found a global au­di­ence and built busi­nesses on YouTube.

Rev­enue comes from ev­ery­where – spin-off books, CDs and mer­chan­dise; funds raised from fol­low­ers; spon­sor­ship from brands; and a share of ad rev­enue. YouTube does not re­veal fig­ures but Mor­gan Stan­ley es­ti­mates it will make about $US6 bil­lion in rev­enue in the US this cal­en­dar year. It signs cre­ators as part­ners and re­port­edly gives them a cut of about 55 per cent, de­pend­ing on their hits.

Mega-au­di­ences don’t nec­es­sar­ily trans­late to mega-bucks, even if chief ex­ec­u­tive Su­san Wo­j­ci­cki says that some end up em­ploy­ing not just their fam­i­lies but “their whole town”. YouTube says part­ner rev­enue has grown by 50 per cent year on year.

For Bernie Su, who ar­rived in Los An­ge­les want­ing to be a screen­writer, YouTube proved the an­swer. His videos are a riff on Jane Austen nov­els and Su has spun off The Lizzie Ben­nett di­aries (based on Pride and

Prej­u­dice) and Emma Ap­proved ( Emma) into DVDs and e-books sell­ing around the world. "We're very big in Brazil,” he says.

Much of the suc­cess of YouTu­bers rests on watch­ers feel­ing they are in­side the cre­ator’s life, so keep­ing it real once you be­come fa­mous is a chal­lenge. Cassey Ho has par­layed a 2009 video she did for her lo­cal pi­lates class into a busi­ness called Blogi­lates, with about 2.8 mil­lion sub­scribers, 12 staff and a line of mer­chan­dise. She says: “It's all about the au­then­tic­ity. I do ev­ery­thing I can to main­tain the trust.”

Cenk Uygur, a Turk­ishAmer­i­can whose pro­gres­sive news net­work The Young Turks has more than 86 mil­lion views a month, says when TV stars win awards they thank their agents, but when YouTu­bers win awards, they thank their au­di­ence.

He says: “I worked in TV, and I hate the gate­keep­ers. The best gate­keep­ers are the au­di­ence. TV is go­ing to die (but) once you start build­ing your own au­di­ence, it’s as close to per­ma­nent as you get. If you go to a TV chan­nel (as a com­men­ta­tor) you are bor­row­ing your au­di­ence.”

From left, Cassey Ho ( Blogi­lates), Bernie Su (The Lizzie Ben­nett Di­aries), Joey Grac­effa (vlog­ging and gam­ing), Cenk Uygur (The Young Turks news net­work) and Shira Lazar (What’s Trend­ing)

at the YouTube Space in LA

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