Twitch tries to restore streamers' trust after compensation changes

Twitch tries to restore streamers’ trust after compensation changes

Weeks after Amazon.com Inc’s live video streaming site, Twitch, announced controversial changes…

Weeks after Amazon.com’s live video streaming site Twitch announced controversial changes to the way creators make money on the platform, executives sought to rebuild trust with streamers at the annual TwitchCon conference.

Twitch’s community manager Mary Kish said that during her weekend conference in San Diego, she had tough conversations with streamers about dinner and drinks. “I really sympathize with them. This is their life, their jobs; they pay for their homes and feed their children with that money,” Kish, a broadcast TV celebrity, said. “These decisions are aimed at long-term sustainability for both parties.”

Last month, Twitch announced that starting next June, it is adjusting its revenue sharing model so that top players will keep 70% of the revenue for the first $100,000 earned on the site through fan subscriptions, but that will drop to the standard 50 /50 split after that. President Dan Clancy said in a blog post at the time that the change was intended to remove inconsistencies in how Twitch arranges these deals.

Increasingly, Twitch has focused on financial sustainability with the goal of ultimately achieving profitability despite the enormous costs associated with the technology needed to support 2.5 million hours of live content streaming worldwide per day. But the changes, including splitting revenue and incentivizing banners to run ads, have proven unpopular with content creators that Twitch considers its primary customers.

At TwitchCon, CEOs and streamers met face to face and tried to come to an understanding. Some sessions gave operators the opportunity to communicate directly with Twitch employees about their financial concerns. There were about 20 episodes and sessions aimed at teaching streamers how to make more money, grow their brands and gain enough popularity to attract sponsorships. Some focused on how to upgrade from “affiliate” to “partner” status, the level that allows live broadcasters to make money through subscriptions and advertising, and how to continue monetizing their business from there.

A raging stream of stars capable of attracting hundreds of thousands or even millions of dollars became increasingly competitive after Twitch’s pandemic blessing. The number of active followers on the site has doubled since September 2019 to over 7 million. The company has taken steps to help more streaming devices make money, such as lowering the level at which a streaming device can pull in revenue to $50 from $100, and introducing products that Twitch says have boosted hourly broadcast revenue by 27% over the past five years. But many streamers feel that Twitch has compromised their profit potential versus the company’s profits.

“They need to start listening to us and taking us seriously,” said one player who goes to Vio, who spoke directly to Twitch staff over the weekend. If anything, she said, TwitchCon has helped her relationship with other streamers who share her frustrations. “The executives haven’t done anything to build trust, but I feel more and more connected to other people in the same boat.”

Although the recent changes affect only a small percentage of the more than 50,000 contestants subscribing to Twitch, those who are the most popular and generate the most revenue, the backlash came from people who felt Twitch was taking a potential future financial opportunity to aspire. to her.

“When you look at your career, you don’t like, ‘I worked,’ and then you never try to get a promotion again,” Kish said. “It’s similar to the creators. They want to know the next step. We have a lot of work to do internally to be like, ‘What’s the next step?'”

Executives addressed the financial concerns of those willing to broadcast privately and in a plenary session on Sunday afternoon that was broadcast live. Although nearly 23,000 Twitch users have asked Twitch to move to a 70/30 revenue model for all players, Twitch Vice President of Monetization Mike Minton told the public that it was “simply not viable for Twitch in the long run.”

Minton noted Amazon’s desire for Twitch to be independently sustainable. “Amazon expects us the same thing as every Amazon company: that we can thrive independently and financially,” Minton said. Refuse to share any specific Amazon projections or timelines about profitability. I also acknowledge that Twitch does not pay public rates for Amazon Web Serivces. Last month, in determining revenue sharing changes, Clancy cited published rates as evidence of the costs of operating the Twitch service.

Twitch has shifted its focus to displaying ads, a strategy that will boost operators’ revenue but some complain that it is not compatible with live broadcasts.

“Many live stream creators weren’t open to showing ads because it wasn’t worth it,” Minton said. Twitch is making ads less intrusive and experimenting with skippable ads.

A Twitch partner and TwitchCon attendee who goes to Vcruzzin said the ad incentive is not in line with his goals as a streaming operator. He wants to keep viewers engaged, and losing their interest isn’t worth him now. “I don’t plan to run ads manually unless offering my ad stimulus is something that will help me and my family tremendously financially,” he said.

Meanwhile, Vcruzzin attended a live TwitchCon event to address operators’ concerns about monetization and leave a feeling of more confidence in the company. “A lot of things have been said that have given me confidence in the direction the company is going,” he said, adding, “No company is perfect.”

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