- Youtube Partnership -
Youtube as an avenue for sustainable revenue generation
This report will explore the structure of the YouTube partnership program and the implications it has for independent online content producers looking to utilise YouTube to generate revenue in order to sustain their creative practice. The Partnership structure has the potential to make money (through advertising revenue) for anyone with access to basic production equipment and an internet connection, but what sort of content will make the money? By analysing and understanding the relationship between content producers, advertisers and YouTube, recurring factors for success begin to emerge. Different approaches to utilising YouTube in order to generate revenue will be demonstrated using two oppositional case studies: Alejandro Portela of Thecuso channel has immersed and informed himself on internal YouTube dynamics in order to maximise his advertising revenue, while Hugo Farrant of Thejuicemedia channel has eschewed advertising altogether and opted for a donation system.
Overview
On Thursday May 3rd, 2007, YouTube announced that it would extend offers for revenue sharing partnerships to independent internet video producers. These producer’s videos were recieving an unprecendented volume of views and subscriptions, and previous to this announcement, only established, professional production organisations were offered revenue sharing partnerships by Youtube for their content. After agreeing to YouTubes Terms and Conditions (as well as YouTube’s Communtiy Guidelines) and acceptance of a Partnership Agreement, YouTube (utilising Google’s Adsense technology) places advertising content adjacent to, or embedded in, uploaded videos. In exchange, the uploader recieves a 50/50 split of the revenue generated by these ads.
In August 2010, a report conducted by US online advertising and analytics firm TubeMogul, the top ten YouTube partners were earning in excess of US $100 000 per annum in advertising revenue. These figures may sound enticing for an aspiring online video producer, but before embarking on a quest for YouTube fame and fortune, there are many factors to take into account. Although it is true that the above mentioned earners are recieving (literally) thousands of views a day, the amount of views and amount of revenue recieved are not always proportionate. Also, relying on a global online audience for views and subscriptions has profound implications for the subject matter, style, and content that can potentially reach the population threshold necessary for significant earnings.
Ownership of content underpins the entire partnership sytem, as does a complex and comprehensive series of sub-clauses that protect YouTube from any accountability, liability and/or rights disputes that may arise from submitted content. Under YouTube’s Terms And Conditions, “You shall be solely responsible for your own Content and the consequences of submitting and publishing your Content on the Service. You affirm, represent, and warrant that you own or have the necessary licenses, rights, consents, and permissions to publish Content you submit;” (YouTube Terms of Service, 2011), and “You further agree that Content you submit to the Service will not contain third party copyrighted material”,(ibid). Without guranteeing the ownership of the rights to distribute your content, there can be no partnership, and no revenue will be generated for you regardless of views or subscriptions.
How it works?
YouTube (the Service) - The distribution platform Sets contractual guidelines and stipulations for Partnership Agreement. Referred to as The Service in all terms and conditions.
The User - Must be a YouTube account holder. The producer and uploader of content. Must own all rights for all content uploaded.
Advertisers (Google AdSense) - Have a vested interest in marketing to online audience of User’s content through YouTube.
These partnerships are a contractual agreement that allows the User to monetise certain videos through placement of advertising content (utilising the Google AdSense), with revenue being generated through Cost-Per-Thousand-Views, viewers clicking on banner ads, or an embedded ad is shown at the start of the video. Each click/view of an ad generates an undisclosed amount of revenue that is shared with the User (part the Partnership agreement consist of a Non-Disclosure Agreement). Revenue is split 50/50 between Youtube and the User, and Users will not recieve a cheque from Youtube until the first $100 is accrued. Users can choose to monetise their videos either individually, or agree to monetise all content on their channel, including advertisements placed on their channel index page.
As stated above, the driving force behind including non-professional content uploaders in the partnership program is because of a vested interest of advertisers in a burgeoning online audience. This is stated almost explicitly in the official YouTube Blog announcement, released on May 3rd, 2011.
“...Initial user participants have been selected from the content creators that you have helped popularize by watching their videos and subscribing to their channels. Because they have built and sustained large, persistent audiences through the creation of engaging videos, their content has become attractive for advertisers, which has helped them earn the opportunity to participate on YouTube as a partner.
Participating user-partners will be treated as other content partners and will have the ability to control the monetization of the videos they create. Once they’ve selected a video to be monetized, we’ll place advertising adjacent to their content so participating user-partners can reap the rewards from their work.(YouTube offical blog, 2007)”
The system of advertising placement is implemented using Adsense, a subsidiary of Google. This is the same system that places sidebar ads on your Gmail page, or on sponsored websites. This is best explained in Google’s own words. The placement targeting model is specifically relevenat to YouTube videos:
“Google automatically delivers ads that are targeted to your content or audience. We do this in several ways..."
Even before an ad is displayed, a silent bidding war takes place between rival advertisers on webpages (including YouTube). When a monetised video is opened, “Google places relevant cost-per-click (CPC) and cost per thousand impressions (CPM) ads in the same auction and lets them compete against one another. The auction takes place instantaneously and when it's over AdSense will automatically display the ads that will generate the maximum revenue for a page -- and the maximum revenue for you.”(Google Adsense FAQ, 2011)
- Contextual targeting
Our technology uses such factors as keyword analysis, word frequency, font size, and the overall link structure of the web, in order to determine what a webpage is about and precisely match Google ads to each page. - Placement targeting
With placement targeting, advertisers choose specific ad placements, or subsections of publisher websites, on which to run their ads. Ads that are placement-targeted may not be precisely related to the content of a page, but are hand-picked by advertisers who've determined a match between what your users are interested in and what they have to offer. - Interest-based advertising
Interest-based advertising enables advertisers to reach users based on their interests (e.g. 'sports enthusiasts'), and allows them to show ads based on a user's previous interactions with them, such as visits to advertiser websites. To complement interest-based advertising, the Ads Preferences Manager lets users view and edit their interest categories.”(Google Adsense FAQ, 2011)
Even before an ad is displayed, a silent bidding war takes place between rival advertisers on webpages (including YouTube). When a monetised video is opened, “Google places relevant cost-per-click (CPC) and cost per thousand impressions (CPM) ads in the same auction and lets them compete against one another. The auction takes place instantaneously and when it's over AdSense will automatically display the ads that will generate the maximum revenue for a page -- and the maximum revenue for you.”(Google Adsense FAQ, 2011)