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Creators’ YouTube revenue drops while views rise

Some producers are losing more than 50% of revenues as advertisers pull back. Despite the dips, Aux Mode CEO Adam Rumanek says now is the time to launch more content on the platform.
May 11, 2020

Despite increased viewership on YouTube, kids content creators are taking a major hit to their revenues, according to digital rights management firm Aux Mode.

Views have been steadily climbing on the platform, with a 50% jump in January and another 50% in February, Aux Mode previously found. And within the last 30 days one fully monetized channel (which Aux Mode declined to disclose) racked up an 84% increase in views, a 50% increase to subscribers, and an 84% bump to watch time. Yet, as more consumers are tuned into YouTube, advertisers have pulled back campaign dollars. As a result, that same channel’s revenue has seen its revenue drop more than 50% to around US$3,400 in the last month, says Aux Mode CEO Adam Rumanek. 

The consequence is that creators reliant on YouTube for revenue may see a revenue loss of more than 50%, Rumanek adds. Kids content creators on the platform had already been suffering after YouTube stopped selling personalized ads on kids content in January. WildBrain’s AVOD business WildBrain Spark, for example, saw a 40% year-over-year revenue decrease since the change was introduced in early January, according to CEO Eric Ellenbogen.

However, Rumanek cautions that this isn’t the time for kidcos to jump the YouTube ship and consider moving to alternate platforms. Instead, as a result of the increased viewership, now there’s an opportunity for creators to grow an audience, he says. To offset the revenue loss, producers should publish more content to increase the number of videos making money.

“When things bounce back, there will be a rush of advertisers flocking to the platform and the new subscribers and viewers will translate to revenue,” he adds.

In Q1 2020, YouTube generated US$4.04 billion in ad dollars, a 33% increase from the year before, according to the Alphabet Q1 financial report. However, this growth isn’t holding, and in March the YouTube parent company said the platform experienced “a significant slowdown in ad revenues,” according to its CFO.

The slowdown and drop in revenues has affected London-based distributor Jetpack, which had to release content from its back catalogue to offset its channel’s losses. The strategy worked, and Jetpack’s YouTube revenue is flat despite the decreases, says CEO Dominic Gardiner.

Jetpack rolled out all of France’s Samka Productions’ and Safari de Ville’s 104 x 11-minute animated series Eliot Kid; Samka’s I.N.K. Invisible Network of Kids (26 x 23 minutes); Cardiff-based Bumpy Box’s 40 x two-minute mixed media series My Petsaurus; and Russia’s Wizart Animation’s Yoko (66 x 11-minutes) all within the last month. And while it’s declined to give specific numbers, Gardiner says the company has been able spread revenue out across many more videos.

Although the decrease is a problem, Jetpack can’t leave the site because YouTube is one of the best platforms to promote brands and grow a following for content, he says.

Jetpack’s preschool content has been drawing views, especially the animated series Yoko, where three kids play and adventure with a magical creature. One of its episodes earned more than 10,000 views after its release last month, making it one of the most-viewed videos on the Jetpack channel.

The distributor isn’t entirely reliant on YouTube revenue because it has deals with other platforms that help offset the decrease, says Gardiner. In his view, diversification is key.

“Producers and distributors should be partnering with every platform they can to offset when one of them dips like this,” says Gardiner. “Individually, the smaller players might not net you a lot of revenue, but when you look at the amount you can get collectively from a bunch of them, it can just about equal one big TV deal.”

Photo courtesy of Unsplash.

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Online writer for Kidscreen. Have a story that's of interest to Kidscreen readers? Contact Ryan at rtuchow@brunico.com

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