This week, media brand (and Warner Bros. Discovery subsidiary) Rooster Teeth announced plans to pull some of its most popular shows off of YouTube and move them over to its website instead. While YouTube takes a 50% cut of the ad revenue from Rooster Teeth’s videos, the company keeps all the money when it controls the distribution channel itself.
From the perspective of content creators and producers, a strong presence on YouTube brings with it one key advantage: visibility. While Netflix’s streaming hits and Hollywood video-on-demand titles like “Barbie” soak up the lion’s share of the mainstream press and attention, YouTube remains the #1 most popular streaming service in the U.S. That’s not just on laptops and mobile phones, either, but big-screen family room TVs.
According to Nielsen, in March and April of this year, 8.1% of all television viewing in the US — streaming, broadcast, satellite, all of it together — was happening on YouTube. That’s significantly higher than even second-place finisher Netflix, which grabbed around 7% of all US TV viewing. And once you get past those two, there’s a precipitous drop-off. Hulu got around 3.3% of TV viewing, Amazon came in with 2.8%, Disney+ took just 1.8%, and so on.
Still, once a brand or creator has already attained a high level of visibility on YouTube and has built up a considerable following of fans that it could potentially direct elsewhere, that 50% payout to the platform begins to seem less and less appealing.
Moonbug Entertainment, the studio behind preschooler mega-hits like “Blippi” and “Cocomelon,” has come to a similar conclusion to “Rooster Teeth.” They continue to utilize YouTube and its massive audience of bored children as a workshop to experiment with new franchises. But once those franchises are sufficiently developed, the studio starts moving them off of YouTube and onto what they call “premium” platforms. Moonbug’s “Little Baby Bum” series recently made the jump from YouTube to Netflix, while “My Magic Pet Morphle” — a 2D animated franchise that Moonbug acquired — will soon make the move over to Disney+.
Life in a Post-Harlem Shake World
Still, unlike so many of its rivals in the streaming ecosystem, post-“Harlem Shake” YouTube seems to lack any kind of specific brand identity. For years, it has benefited from being a place where anyone could post just about any kind of content, a massive and impossible-to-categorize clearinghouse for every kind of video available on the internet.
Google has obviously made a lot of money this way, but it wasn’t always the parent company’s ultimate vision for their streaming app. In 2015, YouTube introduced Red, a premium subscription service that would not only remove ads from all the platform’s videos but also grant access to high-quality, professionally produced original streaming shows. Red was intended as a direct competitor to burgeoning streaming sites like Netflix, Amazon Prime, and Hulu, with the idea that its shows could bring together creatives from the worlds of film and TV to mix it up with the platform’s native talent.
The scheme was short-lived, and audience enthusiasm for slick Hollywood-style content on a subscription YouTube service just wasn’t there. By 2018, YouTube killed off most of its slate of original shows, with a few relative hits like “Cobra Kai” jumping to alternate platforms. YouTube Premium still exists, and YouTube alleges it is still growing. But, it’s just a suite of features that improve the overall app experience (like ad-free viewing, “background” play, downloadable videos, and music streaming) without much of a content line-up of its own.
A Crisis of Identity
So if YouTube’s not a place to debut original Hollywood shows and get attention, and it’s not a profitable destination for media companies, studios, and brands to house their most successful and lucrative franchises … the logical conclusion would be that it’s specifically the ideal spot for user-generated content, posted by random members of the public, potentially with an eye toward becoming notable independent creators themselves.
Yet, at least anecdotally, this has also become more challenging than ever. Though the app recently added a mobile editor to rival TikTok’s approach, becoming a new YouTuber requires a considerable investment in gear if you want your videos to really pop and make great thumbnails. The platform is already a massively oversaturated environment where it can be extremely difficult for YouTube creators to get videos in front of potential viewers, and if you have little-to-no experience working with search algorithms or understanding the fundamentals of how search engine optimization (SEO) works, you may never even reach more than a handful of viewers.
Additionally, the platform’s rules and expectations can shift on a dime, often without any warning at all. In the past few years, for example, YouTube creators who produce longer videos suddenly found the platform shifting toward favoring shorter-form content and had to adjust on the fly. And YouTube’s labyrinthine and unforgiving copyright system makes it difficult to avoid pitfalls, making every new video that includes any kind of music or third-party video functionally a roll of the dice. It’s a way of working that’s so demanding and punishing, that even MrBeast, YouTube’s #1 most successful creator, recently complained that he’s “dying mentally.”
That NFL Sunday Ticket Tho
Back in July, following his first full fiscal quarter as YouTube CEO, Neal Mohan sent a letter to investors and the community which listed “supporting the success of creators” among his top priorities. He vowed to improve monetization tools and grow creator communities, to encourage more people to dedicate time to building an audience on YouTube.
Still, specifics on this were few and far between. The bulk of Mohan and Google/Alphabet CEO Sundar Pichai’s remarks were focused on the growth of Shorts (YouTube’s TikTok clone) and corporate content, like NFL games and Netflix shows, licensed for the “YouTube TV” cable replacement service. In September, YouTube did introduce some new tools for creators for AI-editing, but most didn’t actually address the core challenges facing newcomers to the site.
So we have a platform that’s essentially defined by the presence of everyday creators but still declines in many ways to take them seriously. YouTube can certainly survive without the biggest Rooster Teeth and Moonbug shows. It could probably even survive without YouTube TV and NFL Sunday Ticket. But it couldn’t survive the departure of most or all of its users who routinely post the cooking tutorials, fail compilations, memes, puppet sketches, unboxings, and Let’s Plays that make it YouTube in the first place.
Some day, perhaps its strategy will reflect this obvious fact.