NetflixYouTube MarketingIs YouTube heading the Netflix way?

The long-lived era of YouTube which is free for all could be nearing its end with the arrival of Netfilix.
Akshay Chandra4 years ago

The long-lived era of YouTube which is free for all could be nearing its end. Although YouTube generated 4 billion dollars’ worth revenue last year through advertisers, leveraging quality content is getting challenging for them because of newer and tougher competitions. And that is precisely why many industry insiders are predicting that YouTube might be heading towards a Netflix kind of Video On Demand service model.

As you might know already, YouTube shares 55% of the ad revenue with content creators. And for video creators who churn out high-quality content, this revenue sharing model might not generate sufficient income to cover their production costs. And as one can expect, they are being lured by other platforms which are offering a much more attractive revenue plan.

In this blog, we list down some of the competitors who are actually making YouTube sweat it out and also try to explain how they are doing it:

Vessel

Founded by Jason Kilar, the former CEO of Hulu, this startup has generated $75 million in investments. Vessel is a product with a paid subscription model and offers unlimited quality content to its customers for a meager $2.99.

It is steadily growing and trying to lure video content creators through an attractive revenue plan. They have already managed to rope in some well-known video makers from YouTube to stream their videos 3 days in advance on their platform!

Vimeo

Vimeo was the first video sharing website to launch the support of HD videos on its platform. Already praised by many as one of the most creator-friendly video sharing sites, Vimeo concentrates more on the Video on Demand model and gives less importance to the Free version.

Creators of High Maintenance, an online web series on Vimeo; earned more money in 2 days of its launch, than they would have earned in two years on YouTube! Vimeo pays creators 90% of gross revenue after deducting transaction costs.


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Facebook

Facebook is trying everything it can to beat YouTube in its own arena. It has already roped in popular YouTube content creators and celebrities to broadcast their videos directly through their pages.

Facebook Mentions; an app released recently, through which celebrities can stream Live videos and interact with their fans has been a big success. And its success was probably one of the reasons why Facebook will be streaming the next edition of Oscars live (Yup, no YouTube this time)

Amazon Video Shorts

Imagine that you are watching a video on “How to shave” and instantly you have the option to buy a Gillette razor without leaving the platform! What if you could buy a Razor right in that interface?! Pretty cool eh?

Amazon Video Shorts is doing exactly that to attract brands to push their videos on its platform. This might eat into a substantial portion of YouTube’s Brand Channels.

DailyMotion

DailyMotion started at the same time as YouTube, it could never really compete with the vast reach of the latter. Although HD videos and content in multiple genres is important for a video sharing platform, a slick and seamless interface is equally important. By limiting the video size to 20 min or 150 MB, Dailymotion ensures that it loads faster and works smoother than most of its counterparts.

Till recently, YouTube was the undisputed king of online video but the times have slowly changed. There will definitely be gradual changes in the mindset of content creators as well as they start looking for platforms which can offer them more revenue. But it’s still quite hard to predict if this will force YouTube to change its business model drastically.

But YouTube has started testing out newer revenue models with its other offerings. By the end of this year, it is set to launch its Music platform YouTube Music Key which will offer paid subscriptions and better revenue sharing models for creators. Users will have to $8 to $10 for a month for unlimited ad-free premium music.

However, for YouTube, it won’t be an easy road ahead in this direction too.

Artists like Jay-Z have already expressed their disagreement with YouTube’s business model. Jay Z, in fact, has launched his own product Tidal, a music streaming platform as competition to YouTube Music Key.

And he has been quite vocal in criticizing YouTube’s revenue model – “I feel like YouTube is the biggest culprit. Them ni**as pay you a tenth of what you supposed to get. You know ni**as die for equal pay, right?”

Many soothsayers are saying that YouTube will go the Netflix way in order to retain the creators. But only time can say how all of this is going to pan out.

Are You Tube’s ad revenue policy doing right by the content creators, or should they move on to websites which offer them more revenue? Do comment below and let us know what you think about this situation.

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Akshay Chandra

Being an artist, movie buff and a media enthusiast, content writing is my career train. I am a proud alumni of Symbiosis Institute of Media Communication (Pune) and currently working for Vidooly.

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