Earlier this year BBC Radio 1 got in touch with me because they were looking for insight and expertise on YouTube, monetization and the value of views. The interview was edited and put into this audio documentary called “Iggy Azalea: Music by the Number” about Iggy Azalea, her music and how much money her record label has made with the YouTube videos. The full audio doc is no longer available on their site but I’ve uploaded to my Soundcloud… that is until the BBC takes it down.
My friends Jason Ambrus and Richard Lajoie started Fire in the Hole podcast just a little over 3 months ago. FitH didn’t start with a specific mission, at first, Jason and Richard made it up as they went but after a few episodes, an underlying theme of real stories has become a recurring subject. They often have guests that give insight and help debunk subjects that warped by pop culture. The conversations are always entertaining and fun, just like good friends have over beers that you want to be in on and give your two cents.
I was fortunate enough to participate in one where we had a chance to catch up, discuss our passion for classic Transformers, 80s cartoons and my personal battle with childhood kleptomania. You can listen to it here.
“YouTube, online video, the internet is mainstream, its not a stepping stone, its the finish line”
“On YouTube nobody gives a sh*t who you know, they just care if the content is good.”
I’m literally kicking myself for not going to VidCon this year. VidCon co-founder / author / YouTuber John Green always kills it with his opening speeches. I highlighted a couple of quotes that ring very true to my beliefs.
“Hi I’m John Green. I’m a novelist and videoblogger and I’m so excited to welcome you to Vidcon, which was created by my brother Hank and has been run entirely by him and his amazing team ever since, but because I was on a conference call in 2009, I am technically Vidcon’s cofounder. So if you have a great weekend, you’re welcome, and if anything goes wrong, it is Hank’s fault.
So I was a writer before I ever made videos; my first novel Looking for Alaska came out in 2005, one month before the first video was uploaded to YouTube. The intervening 10 years have been very good for online video of course; it’s also been very good for me. My book The Fault in Our Stars has spent 187 consecutive weeks on the New York Times bestseller list and was adapted into a successful film last year. The movie adaptation of my book Paper Towns comes out in theaters around the country tomorrow, which if I seem a bit tired…well that’s why.
None of this would’ve happened without YouTube. My brother and I have been making videos back and forth to each other since 2007, and since then the biggest lesson I have learned is that I suck at predicting the future. I could never have imagined, for instance, that our crash course videos would be used in tens of thousands of schools around the world. I couldn’t have imagined that YouTubers would be turning down traditional TV opportunities because, as a friend of mine recently said, “Why would I take a pay cut for the privilege of not owning my intellectual property?” And I could never have imagined that the phrase “online video” would be rendered redundant by the onlineness of all video, or that 20,000 people would show up to a conference about YouTube run by my brother.
The future—especially the future of technology and media—is completely impossible to predict, and whenever I’ve tried to do it I’ve ended up looking like an idiot. It’s hard enough just to try to understand the present, so I’m just gonna focus on that. Here is the present as I understand it: Great video is being made off television—video about global poverty and about BASE jumping and about how coffee gets decaffeinated and why Mark Rothko is a good painter; videos about makeup and fashion and video games and we are even starting to figure out how to adapt the conventions of scripted video to the online world. But most of the people engaged in these viewing communities are young, and I’m sure you’re familiar with the narrative that young people are distracted and self-involved and disengaged.
Like, makeup is so superficial and silly, and who would watch other people play video games, and so on. But of course we know the truth—that while everyone talks about young people’s disinterest and solipsism, they are building communities through makeup tutorials and learning about selfacceptance and selfcare. Like, watch Ingrid Nilsen or Louise Pentland. And they’re building communities through gaming—pewdiepie’s viewers are not just watching him play video games; they’re also working with him to raise hundreds of thousands of dollars for Save the Children.
While my generation has been watching The Blacklist and congratulating ourselves on our intellectual sophistication, young people are building a vast and complex world of deep engagement online and off, in which they are not just passive viewers or listeners or readers but active community members creating comments and fanfiction and artwork that is pushing culture toward listening to traditionally marginalized voices, toward a more just and open social order—toward what I think of as engagement. So one of the reasons I watch YouTube—really, one of the reasons I do anything—is that I want to be distracted. I want to be distracted from my anxieties, from my responsibilities, from my real life. I like distractions, and I think they are important, but online video is not only about distractions; it’s also about engagement, and there’s the rub when it comes to our business, which has traditionally been funded primarily by advertising.
Advertising is really good at funding the distraction business, because the number of eyeballs a distraction attracts is a good way of judging its effectiveness as a diversion. But advertising sucks at valuing engagement, which is why ad rates on many online videos have never reflected the real value being created. Distraction is a good and noble business, but I think deep down most of us—creators, marketers, investors, agents—don’t really want to be just in the distraction business—especially now that we can see the value and awesomeness of being in the engagement business. It’s good to distract people from their problems; but it’s better to help solve those problems, whether it’s the problem of finding meaning in life or the problem of being unsure how to tie a bowtie.
So the kinds of video that mean the most to us online—the ones that help us to lead fuller and better connected lives—are dramatically undervalued by advertising. Hank and I have tried to address that by building a business that doesn’t rely much upon ads: Our educational channels crash course and scishow are funded mainly by viewers who voluntarily support the shows through Patreon, and selling posters and tshirts through DFTBA Records provides more revenue from merch than we’ve ever made from ads. Advertising still provides around 20% of our company’s revenue, but it’s shrinking every year. That’s true for many creators—they’re doing live events and publishing books; they’re crowdfunding and producing albums and selling tshirts and getting grants from nonprofits. In short, they’re building a world where they don’t have to depend on advertising.
And to be frank, I believe an Internet that answers to its users is healthier than an Internet that answers to brands. This year has seen the emergence of a big conversation about how to fund online video in the future: Should we build the future of online video around paid subscriptions, or advertising, or voluntary payments, or some hybrid model, or something I haven’t heard of yet?
I believe in advertising, but I also believe that to remain relevant it must change. The real opportunity for brands—which I don’t think marketers can find on TV or anywhere offline—is to help creators to build and foster better communities, so that those communities can bring better and more interesting stuff into the world. if brands interact with those communities authentically and don’t impose their values or messaging on them, they’ll win over those passionate and engaged communities—not for a quarter or for a campaign but for life. If a brand makes the minutephysics video that helps me to understand relativity possible, I’m not going to forget the gift that company has given me. But advertisers must learn that in the world of the engaged Internet, the less obtrusive they are, the more successful they’ll be. I also believe in voluntary payments—I think if you’re transparent with your viewers and they really care about your work, they’ll support it and help it grow. I’ve seen that in my own career. And I believe in the promise of subscriptions, too. Although I’ve never seen a paywall grow anyone’s audience, I’d gladly pay to watch my favorite creators adfree.
In short, I have no idea what the answer is to the problem of monetization. But I hope that as we discuss it together, we’ll consider not just what will bring in the most immediate revenue, but also what kind of online video world we want to live in. How can we foster community, and grow the Internet of engagement? What business models will best allow the free flow of ideas and content between viewers and creators? What will help us to build a broader creator base that includes more diverse voices? I know those don’t seem like business questions, but I believe ultimately they are, because while we all must think month to month and year to year, my favorite thing about making original content online is that in the long run, what’s good for your community is always— always —good for your business. Thanks. “