By Alistair Barr
YouTube created a new kind of celebrity. Now it has to treat
them like stars or risk losing them.
At the annual VidCon gathering of Internet video personalities,
a battle of pitches is being waged this week between Google Inc.'s
incumbent service and new rivals looking to lure away top online
video talent.
More than 10 online-video providers presented for the first
time, including Twitter Inc.'s Periscope and Vine, GoPro Inc. and
Comcast Corp., according to VidCon organizers. Facebook Inc.,
YouTube's biggest rival, sent executives to the Anaheim, Calif.,
event.
"Everyone is interested in other platforms to diversify or to
develop new audiences," said Hank Green, host of popular YouTube
shows such as "Crash Course" and a co-founder of VidCon.
Cenk Uygur, host of a top YouTube news channel called "The Young
Turks," earlier this year launched a show exclusively for Facebook.
YouTube has "stepped it up over the last six months," he said,
though he is talking to other platforms at VidCon.
That kind of pressure is forcing YouTube to forge better
relationships with popular creators, finding them opportunities for
growth and in some cases paying them more.
YouTube now has a division that focuses solely on its "top
creators," addressing their complaints, helping them to craft new
material and generate more revenue. The team tries to steer the
best videos to "Google Preferred," which makes the top 5% of
YouTube content available for advertisers to buy upfront at premium
prices.
"I want to be running a platform that they can stay on, that
they can grow up on and extend their work even further," YouTube
chief Susan Wojcicki said in an interview.
More than 1.3 million people subscribe to Anna Akana's YouTube
channel of comedy and advice sketches. A member of YouTube's
top-creators team called her in early July inquiring about any
concerns or ideas she had. Before that encounter, she said, she had
rarely spoken to an employee in four years posting to the site.
Ms. Akana said she wanted to do longer, narrative videos. The
team arranged a meeting with YouTube Originals, which helps
creators develop shows and movies.
A YouTube representative helped Elise Strachan, creator of the
popular channel "MyCupcakeAddiction," apply for a grant from a
joint venture between the Australian government and Google that
funds higher-quality online video production.
At VidCon on Thursday, Ms. Wojcicki announced new studios in
Toronto and Mumbai slated for 2016, where YouTubers can use free
stages and equipment. She also unveiled a redesigned mobile app
that showcases creator channels more. On Wednesday, YouTube hired
MTV programming chief Susanne Daniels to oversee original movies
and series starring top creators.
Online video, and the payments that go with it, is one of the
hottest battles. Annual advertising spending on digital video is
growing 34% a year and will hit almost $10 billion in 2016,
according to investment bank Luma Partners.
YouTube late last year began dangling extra money--upfront
payments and bonuses on top of the usual 55% cut of ad revenue--to
some top creators who post to YouTube first or at the same time as
other platforms, according to people familiar with the
situation.
Vessel, run by former Amazon.com and Hulu executive Jason Kilar,
is one of the rivals offering lucrative payouts if creators post
first to the startup. Vessel charges a $2.99 monthly subscription
and offers creators 70% of ad revenue. It also shares a big chunk
of its subscription revenue with creators.
Ms. Akana isn't getting as many views on Vessel as she does on
YouTube but said she is making a larger, steadier income, including
a minimum annual income.
She said her YouTube videos garner about $2 in ad revenue for
each thousand views, meaning a video seen one million times will
generate $2,000. The creators get 55% of that. A person close to
Google said YouTube videos can fetch far more than $2 per thousand
views.
Ms. Strachan, the creator of MyCupcakeAddiction, still says
Facebook caught her interest when it said in early July it would
start sharing ad revenue. "When it is monetized that will be very
interesting," Ms. Strachan said. "I honestly don't know which will
be the better option."
Meanwhile, YouTube and its rivals are trying to one-up each
other in offering to get stars to the next level.
Vimeo, which is owned by IAC/InterActiveCorp, is launching a new
series in September that is packed with YouTube stars such as
PewDiePie and Grace Helbig. Netflix has also started streaming
shows created by or starring top YouTube talent.
YouTube in April announced its similar efforts with top stars
such as the Fine Brothers and Smosh. The movies will premiere on
YouTube before becoming available elsewhere, it said.
Ms. Wojcicki said deals with content creators are confidential
but that YouTube isn't resting. "Other media companies are coming
to creators and doing XYZ with them," she said, "and I'm saying
well why can't we do XYZ with them?"
Write to Alistair Barr at alistair.barr@wsj.com
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