Google-owned YouTube is the unrivaled king of video hosting and has a staggering 75 percent market share. Facebook-owned Instagram, meanwhile, has a billion users. Together, these platforms are home to the world’s finest influencers—colorful, crowd-pleasing arbiters of style, who will willingly gush recommendations to their millions of followers on behalf of grateful brands.
But on planet Instagram, there are signs of discontent (and dis-content too). Influencers are tiring of the carefully contrived, rainbow-hued “Instagram look.” And YouTube’s blanket system of moderation—to guard against unsavory content—is making it progressively harder for content creators to win the advertising revenue they rely on from brands.
As a result, influencers such top YouTuber Felix Kjellberg (known online as ‘PewDiePie) and actor/content creator Matthew Espinosa, are looking for pastures new. And a raft of blockchain startups are dangling a larger slice of the revenue pie–and a hands-off approach to censorship–to influencers willing to launch channels on these new platforms. One of those, the soon to be launched, Vid claim to have poached battalions of users and an impressive stable of influencers. Is the tide turning on the tech 2.0 giants or are we entering a no-holds-barred age of influence?
It was a PewDiePie video, featuring anti-Semitic imagery and language, that sparked YouTube’s evermore restrictive content policies, the so-called ‘Adpocalypse.’ The result has been algorithms unable to distinguish between a video debunking white supremacy and another promoting it.
Channels have been purged from ad networks and forced to wait to find out if their accounts meet YouTube’s rigorous new standards. Smaller creators have lost what little ad revenue they had.
The money that Vid is making from the brands is going directly to creators' pockets. They are taking care of the creators that are taking care of the platform.
Influencers like David Doel, host of popular YouTube series 'The Rational National’, are turning to crowdfunding through websites like Patreon and looking to diversify via streaming platform twitch.tv, “because you never know what might happen.” Some have gone even further.
PewDiePie was one of the first major influencers to actively endorse one of the new blockchain-based platforms. In April he announced that he was joining live streaming platform DLive on the Steem blockchain, which also features content creation platform Dtube.
These platforms allow users to upvote or downvote content in a self-censoring environment where unpopular videos are pushed down the search rankings. But their key feature is that they allow users to get paid for creating and curating content, establishing a more direct relationship between providers and users.
Taking care of the creators
One of the latest to turn to the new breed of channels is Matthew Espinosa. The American actor, YouTube vlogger, and Instagrammer (he has 5 million followers,) is a dab hand at the “look-at-my-crazy-life” genre of YouTube, but has recently been a victim of the video hosting site’s over-enthusiastic algorithms.
“Daily stories I'm posting—whatever it may be—a lot of that we can't monetize,” he told Decrypt in an email.
The 21-year-old announced last week that he’s joining Vid, a new blockchain-based, short-form video sharing application where AI auto-generates videos from content synced to user-chosen music. Users can selectively reveal their content publicly to brand advertisers and “monetize their memories.”
The platform is due to launch in beta this month with 50 major influencers. Among others, actor/rapper Jerry Purpdrank (9.2 million followers on YouTube-competitor Vine and 3 million on Instagram,) and actor/Influencer Piques (9 million Facebook followers and 2 million on Instagram) have jumped on board.
The blockchain powered bits of these networks use zero-knowledge encryption, the basis for privacy-oriented cryptocurrency networks like ZCash, ensures consumer data is always secure–something YouTube has struggled with this year.
Where YouTube pays out an average $7.60 for every thousand views of a video, Vid pays 1-10c every time someone clicks a video featuring an ad. Unlike YouTube, which skims off a commission, Vid users and influencers retain 100 percent of ad revenue and instead pay a $1.99 a month flat fee to use the platform.
“The money that Vid is making from the brands [is] going directly to creator’s pockets,” says Espinosa. “As a content creator, someone who needs to pay the bills—just like anyone else, that helps out a lot. They are taking care of the creators that are taking care of the platform.”
Technology influencer and Forbes 30 under 30 entrepreneur Evan Luthra has a more modest following of half a million on Twitter and Instagram. His decision to sign up was largely driven by the presence of other influencers.
“I love the fact that they have a huge influencer network with a combined following of 375 million people ready to use the platform,” he told Decrypt. If even one percent of those followers convert into users, that’s more users then Ethereum has today!”
The next iteration
Vid co-founder 29-year-old Jag Singh and his brother-partner spent two years and $1.5 million of their own money building the product (which has seven patents pending). They made their fortunes founding a niche fuel company in the UK, which reached £25 million in annual revenue within two years.
The idea for Vid came about when they took a Go-Pro along with them on a ski trip and couldn’t find a platform to create the professional looking footage found on YouTube, he told Decrypt.
“A lot of influencers have two or three editors, a cinematographer and all sorts of things for the YouTube videos they create. And here, with the click of a button, they can get a one-minute long video that they can monetize.”
Want the best of crypto news straight into your inbox? Sign up to Debrief. Or
Join Daily Debrief
Want the best of crypto news straight into your inbox? Sign up to Debrief.
But Singh believes that where other blockchain-based platforms, like Steemit, have failed is in thinking it’s enough to be a like-for-like YouTube copy.
“Automated videos of your life are the next iteration,” he firmly believes, and that’s separate to the blockchain element which lives quietly under the hood. “The average user may not even realize this, but I think it’s very important to have that transfer of value”—the feature enables the platform’s users to deal directly with brands.
Analysts estimate that the influencer market will be worth as much as $16 billion by 2020, as brands increasingly look to influencers to fuel growth. These user-brand connections are more efficient than traditional platforms; they automate workflows and eliminate the middlemen so that social networks are free to scale faster than ever.
But could they trigger the starting pistol for a social experiment many don't want to be part of—a race to the bottom in the lengths creators are willing to go to serve audiences? Unfettered by moderators, these new content platforms open a pandora's box of censorship-free content creation that’s beyond copyright infringement.
These are factors that YouTube is well aware of, as it ties itself in knots of self-censorship. Its response to demands by influential advertisers to remove controversial videos and channels has meant that the once experimental platform has been branded ‘Hollywoodesque’—safe, bland. Boring. A place made unprofitable due to its unfriendly algorithms.
Pew Research suggests that 45 percent of teens are now online on a near-constant basis, and video content is expected to comprise nearly 80 percent of all web traffic over the next year. Millennials, starved of choice, are looking for alternative video-centric platforms, with many valuing the increased authenticity and privacy that comes with them. The influencers, like modern-day Pied Pipers, will call the tune. YouTube will be hoping it’s not yet loud enough to lure users away.