(upbeat music)
- But there is a bigger topic this week.
And, I think we need to dedicate a big portion
of the show to it.
So we're going to talk about Twitch leaks.
And this all started basically with a tweet
and a Bloomberg article that kind of came out hand in hand.
There's a few things that have been considered
for the partner program.
And it's got to be made clear
that this is not directly from Twitch.
This is a leak of some sorts.
Twitch haven't communicated this themselves
and they haven't even spoken about it at this point.
I think there's probably been enough like inside sources.
Streamers sort of saying that they've heard rumors of this
that I think there's definitely some truth behind it.
So the ideas within this restructure
of the partner program are, and there's five of them.
Incentives for more ads,
a new revenue split reduced from 70% to 50%,
new tier system for partners,
no more exclusivity.
So can stream to different platforms.
And the changes could be implemented as soon as this summer.
Let's break these down one at a time Ben,
'cause there's different things to be annoyed about
but I also think there is some good news in this.
Well, there's one bit of good news in this
and the rest are bad.
So let's go one at a time.
So Incentives For More Ads.
When you think of Twitch,
is there any part of you from the viewers perspective
that wants more ads?
- Absolutely.
I cannot get enough ads, Pete.
I need more ads in my life.
Yeah, so this is maybe not the biggest one from this list,
even though really it's a big one for sure.
And it's very vague,
sort of we don't know what this is going to be it's just a leak
but incentives more for more ads.
So at face value that looks like
there's going to be more ads on Twitch, right?
At the end of the day whatever that looks like.
Now there could be some upsides to that
in a way for the creator.
If they maybe they give a better rev share on the ads.
I've heard just how drastic the difference is
%between YouTube and Twitch on the ad cut for or creator.
So if you actually have a better cut
that could be nice for your income.
But of course the viewership experience
with ads right now on Twitch is basically unwatchable
for a lot of people.
And I know a lot who use ad blocks
and even pay for turbo stuff like that
just to avoid the ads at this point.
Cause it's so wild.
So I don't know.
I'm more worried about this one.
If it makes a lot of more unskippable ads
that really break up the content
and make you not able to watch key moments,
then it's not going to be good.
But again, it's a rumor
so we're not exactly sure what exactly that'll look like.
Pete, you have thoughts on this so far?
- Yeah, I'll touch briefly on something
that you mentioned there,
which is the revenue split for ads on Twitch
and how bad it is.
Because right now it isn't done as a percentage
of What Twitch earns
in terms of when the advertising agency pays Twitch
to play an advert to a thousand people,
10,000 people, a hundred thousand people.
Twitch doesn't share that money with the streamer
that is playing the ad as a percentage.
They pay sort of a flat rate.
And they don't disclose any information really
on what they're earning.
Whereas YouTube does split the money
and it's built into their partnership program.
So when you run an advert on YouTube,
YouTube takes a cut
and you as the creator, get a cut.
So right now the earnings
that you can make as a streamer on Twitch
from adverts is awful.
It's such a small percentage of what people are making.
I mean, the big, big streamers
that are pulling in 40, 50,000 people,
it probably is a substantial amount
but still way less than subscriptions, gifted subs,
donations if you have donations enabled,
all those kind of things.
So when I see incentives for more ads,
I'm really hoping that's a restructuring of the ads program
and some way of actually having a revenue split
between Twitch and the creator for running this ads.
But there is no news of that.
All it says is incentive for more ads.
So is that going to be just,
kind of what we're seeing with those bounties
of if you run three minutes of ads every hour
and you stream 40 hours this week,
then we'll give you an extra a hundred dollars.
Is that what they mean by incentives for more ads?
Because as a viewer and as a streamer,
the last thing you want is to be pushing more ads I think.
And the control needs to remain with the streamers, right?
There's nothing worse watching live content,
then getting an ad in a really key moment of a stream.
Whether that's an eSports title in a really clutch moment
or a blooper when somebody's cooking
in a cooking live stream.
The control needs to stay with the streamers.
And I'm worried that when I see incentives from more ads
that's going to mean a worse experience for viewers
and probably a worse experience for streamers as well.
And really is just Twitch
or that overloads Amazon wanting to actually earn some money
from this beast based Twitch.
- Well, and that's the art piece of it too.
And this goes into some of the art pieces
but it is,
like Twitch is still not making money right?
So I understand that they have to try something
to try and become profitable.
It just, it has to be done right.
And I think that the current ads experiences, it's not good.
It's not going to help them grow the platform
and therefore make more money at the end of the day.
So I would love to see more of like,
the banner ads, the bottom.
Or like the multiplayer ads, which we talk a lot about.
But I have not really seen much of those used
since they were announced.
So I don't know the text there, they just got to use it.
But the next piece kind of related to the revenue.
I think this is maybe the biggest piece
that got to be Pete from what I saw.
And that is,
there's a rumor that
for the creators who have a 70/30% split.
So this is if you get a sub on Twitch,
you're taking 70% of that $5 and Twitch gets 30.
Which is usually only open to like the top creators
or creators who work their way up sort of
from the base 50,50.
Those creators would remove back down to 50%.
And then that 20% difference to go back to Twitch.
So this is, I think the one
that get the most attention especially.
'Cause obviously big streamers who are affected by this,
were probably pretty outspoken about it since.
Especially from the mid to top creators.
That's a really big pay cut
if you're losing out that 20% of your sub for every sub
and you're full time.
So it's one I think is the most concerning for people.
And it's unclear if this is just for top creators.
Like if it's just the 70% people who move down to 50
or if people at the 50 have moved down to 30,
like it could be more than that because it's just rumor.
I think for now we just know this 70 to 50
and that's kind of where the debate is.
Pete, what what'd you think about seeing all this?
- Yeah, I mean,
I think there's a few things to break down here.
Firstly, this isn't the fault for all partners,
the 70% split.
And in fact it's a really small percentage of partners
that get this.
It's kind of negotiated usually
based on hitting certain metrics.
You might be on to negotiate when you renew a contract
that you get a better revenue split.
And that is typically 70 to 30.
But we're still talking about a really small percentage.
And really we're talking about
like the top echelons of Twitch
that are on this 70%/30% split.
So I don't want people thinking
it's all partners that get this
because it's not the fault partner contract.
It's this kind of the same as affiliates.
It's 50/50.
This is something that I've heard Twitch has been trying
to cut back on anyway.
A lot of the creators that are already on 70% split
that don't have huge viewerships
or because they're kind of grandfathered.
They've been partners for five plus years
and it was like one of the incentives a long time ago
and it was fairly easy to negotiate
but it's certainly not standard.
But yet this is a affecting a really, really small portion
of creators.
But also kind of in some ways
from Twitch's perspective like the most important portion,
they'll definitely think of the top echelons
as the important ones,
'cause they're the ones that hold a lot of the viewership.
So you don't want to piss these people off
because these are the people that taking a 20% pay cut
on a substantial portion of that pie of income
which is subscriptions, gifted subs as well
is really significant.
I think I saw some people doing the math
on like the biggest creators
with hundreds of thousands of subs.
And this can be like $500,000 by the end of the year.
How much the extra money they're losing
if they go down to 50% revenue split.
So that is enough definitely to be considering moving
to a different platform.
So exactly the same as you.
I saw a lot of people talking about it.
The people that were really outspoken
were probably the people most effective.
I've also seen the other side of it,
being like, this doesn't affect me,
doesn't affect the largest number of creators
on the platform,
but we are talking about partners here.
So this is already
outside of the affiliate agreement anyway.
So, yeah, it's going to be significant
if this does come into play,
but at the same time,
I think Twitch is going to be really careful
about how they speak about this
because they don't want all of their big creators leaving.
And this probably is big enough news to piss them off
to leave to a rival platform.
I mean it kind of ties into the no more exclusivity.
So let's just jump straight into that.
I know that we're skipping
probably the most boring bullet point from this,
but no more exclusivity.
This is the only big change in this lineup
unless incentives for more ads also includes
like some kind of revenue split.
No more exclusivity.
I heard Devon also speak about this.
Like exclusivity is the most stupid part
of the Twitch contract.
The fact that it comes in at the affiliate tier
is pure evil from Twitch.
Like there's no other way to say it.
They they've made the affiliate tier so easy to reach,
streamers get really excited
'cause they're streaming
and all of a sudden they affiliates
and they can start to earn money.
And made to sign a contract that makes sure
that they can only live stream that content to Twitch.
And they can't even post that content
to YouTube for 24 hours.
Like it's just bonkers that this exists.
It is in no way good for the creator.
Like there is no reason why exclusivity
is something that a creator wants.
It's purely from Twitch's point of view
to make sure that people feel
that they have to stream to Twitch.
And Twitch is the only platform that they can stream to.
And it's to try and stunt their growth on other platforms.
I'm convinced on that.
So this is a good change.
This is a change that should happen regardless
of whether this whole partnership restructure should happen.
It should definitely happen at the affiliate tier
and it should happen at the partner tier as well.
If I'm being completely honest.
Because it's just,
in my opinion, it's pure evil from Twitch.
It should never been included.
But it's been there since the very beginning.
It's been there from I think 8, 9, 10 years ago
when the partner scheme first came in.
So no more exclusivity would be a huge change I think
for Twitch.
What do you think there?
- Yeah, I think this is the one,
potentially good thing out of this entire list, right?
And like you said, it's kind of archaic system.
That's just bit on there
and I think has just been kept around.
But at this point they're the only platform
that really does it outside of,
like when Sakuna moves the YouTube
that's paying for exclusivity,
but for most people,
having exclusivity is only on Twitch.
So if they were to remove this,
that's a game changer.
And I think if you're an affiliate,
looking at this list overall,
it's actually not as bad as you think,
assuming that it comes out the way that it shows
the bad side is ads.
If ads are forced, then that sucks.
But theoretically,
the revenue split change won't affect affiliates
and the majority of creators who don't have the 70% cut.
If you get exclusivity too,
then that's a huge boost to risk ability.
Especially for that small streamer
who hasn't really been able to kind of break out yet.
Like one thing I would love to be able to do
is to sample stream on TikTok
and push the Twitch.
Which I think actually is just great
for Twitch as a platform.
So I'm kind of surprised that they still have exclusivity
because a lot of times when people are streaming
and multi streaming,
they're pushing people to Twitch at the end of the day.
So, theoretically that's all these people who are marketing
for you on other platforms to get more users to the site.
So I think there's still a lot of upside there.
I get why they're hesitant to do it.
But yeah, I mean, at this point it just feels so ancient
and just kind of evil, like you said on Twitch's part.
And so I really hope they push through that
regardless of other platforms.
I think it'd be a game changer for any people,
even bigger streamers, right?
But especially smaller streamers
just need all the coverage you can get
to try and grow your audience at the same time.
- Let's touch on the last point,
the one that we kind of skipped over,
the new tier system.
I think this is something
that's kind of already been happening
on the back end of the Twitch partner program anyway.
Like we mentioned, not every partner has the 70/30 split.
In fact only a very small portion of them do.
So I wouldn't be surprised if somewhere in Twitch HQ
there's like a Excel spreadsheet
with some kind of tier system
of which streamers can get the 70% split
and other incentives.
But maybe it's going to be a bit of a nicer backend feature
where you can see what tier of part you are
and what you can do to reach the next tier,
the whole partner path to affiliate type thing
that Twitch does.
I think that's reasonably well done
in terms of it encourages the right kind of behaviors.
Maybe we're going to see a more public version.
Did you read into it in any other way than that Ben?
- Yeah, just looking at the article.
It sounds like it's going to be one or the other.
So either they're going to remove all the 70%
and go down to 50 or they'll do a new tier system
and maybe they'd reset people as part of that,
but then you might still have the 70
or some higher cut that you would work your way up to.
I think that it would be nice to have a clear system
for that like you said,
because, even thinking back to partnership,
partnership used to be very vague
on how you apply for that and get that.
And so now you have like the clear 75 average viewers
and here's your criteria to go apply
and here's what you need.
So having that kind of goal set,
I think would be nice for the tier system
if they keep that option.
But again,
that's assuming they actually keep the revenue split
which Twitch is not necessarily incentivized to do
if they want to become more profitable.
So we'll see, this is all rumors and we have no,
the only talent we have is
that changes could be implemented this summer.
So that's pretty vague,
not sure exactly when that will be,
props to whoever leaked that internally
to get some word out,
because I think if they had released this,
kind of like they did for the boost my stream type thing,
there have been even worse backlash initially.
So this kind of helps even Twitch
maybe test the waters a little bit
and see people are thinking for the initial concept.