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This article is part of the On Tech newsletter. Here is a collection past columns.
This week On Tech will examine the economics of what is sometimes called the internet creative economy. There are people who are very good at making entertainment or information online and trying to make it a business. your favorite comedian on Instagram, Herb collector on TikTokor youtube stunt they are creators.
Some of you may be thinking: he A business? It. These online professionals are testing the internet’s promise to enable anyone to make a living from creative pursuits. The work of creators entertains us and they influence what we buy, the music we listen to, and how products are promoted.
Internet experts are also the tip of the spear on what works and what doesn’t in digital life as we know it. More and more creators are now saying they want online companies a chance to share their wealth, and we should listen.
Let me withdraw.
We mostly work on the internet for free.
There’s no Facebook, Instagram, YouTube, TikTok, or Reddit without our volunteer posts, memes, and gardening groups. Some people have found ways to monetize online popularity. sell goods, get paid by fans and signing promotional agreements outside of major websites.
But shouldn’t all online stars – and perhaps us who stream online – share the fortunes of internet companies?
YouTube found a way. The Google site has been selling ads on YouTube since 2007 and hands over more than half of the money to video makers once they reach a certain level. popularity level. When YouTube makes more money, these video makers also make money.
other companies, especially Facebook and publishing site Twitch, cut the advertising money of a small number of video makers. But YouTube remains the only major digital service that systematically redistributes a large portion of its revenue to the people who manufacture its products.
Last week, popular internet personality Hank Green made a video this compares (good) paid to him on YouTube to paid (not so good) from TikTok. shared lump sum for creators that the company pays under a complex formula.
Green’s point was that as TikTok earns more, creators effectively get a smaller share of what the company brings in. Implicit in his video was the question of why more companies aren’t doing what YouTube is doing and sharing a significant portion of their ad revenue.
All internet companies now say that content creators are crucial to keeping users entertained and loyal, and they’re trying to make it easier. fans will pay creators or buy their products.
All potentially useful. But internet companies make money largely from advertisements. Green imagines the creators teaming up to force more of these companies to share their ad money directly with the people who keep their virtual shelves full. It can provide a healthier and more resilient online life for all of us and better jobs for people trying to make a living from their online business.
“There’s a business case that needs to be done to share the revenue, and there’s also a justice case,” Green told me.
In his video, Green pointed out that since most videos feature YouTube ads, it’s easier for YouTube to distribute ad money to creators. Likewise, it would be harder for TikTok, Instagram, or other sites that don’t use ads. YouTube’s revenue sharing model is also an option only for the most popular video makers.
Green knows that YouTube-style revenue sharing won’t fix everything that goes wrong with the internet. And like any workforce, not all creators want the same. Some say that YouTube-style revenue sharing with Green is more stable and more sustainable to live. Others said they preferred TikTok’s funding for creators or Twitch’s ways of letting people monetize live-streamed videos.
investor Li Jin The best route to healthy digital economies is not for internet companies to redistribute their revenues differently. destroying companies’ absolute power over online creative work.
There’s also the financial mercenary argument: Why should any company give up money unless it’s necessary? There will always be hungry young people who are happy to do things for nothing on the Internet.
But this is a moment when the established norms of the internet are questioned. Let’s extend this to the economics of who and what is paid to make the internet fun and useful for all of us.
Coming on Wednesday: Apple’s app commissions are eroding creators’ earnings. And Thursday: How an online personality makes money from the digital business, in a million different ways.
Before you go …
hug this
It Great Horned Owl keeps her egg fried on a windy day. (These ear tufts blowing in the wind are just too much.)
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