The idea of a community site sharing ad revenue with members who add content to the site isn’t new. Forum operators have tested it, for example, by rewarding thread starters with a share of the ad revenue generated by that thread. A review site, RateItAll.com, has implemented a split for its reviewers. To date, I’ve felt there were risks associated with rewarding community members directly for their contributions. By putting what is generally an altruistic or hobby activity into a financial context, one could actually demotivate great contributors. If a Linux server expert writes a great forum how-to post, for example, he’ll derive most of his satisfaction from the creative aspect of writing the post and from the positive feedback of the readers. That he spent a few hours pulling it together doesn’t really matter - it was fun, and his effort is recognized by his peers. But, add a revenue share deal, and let him know that he made $8.37 from that post, and he might start thinking, “Gee, that’s way below minimum wage, and my clients usually pay me $150/hr. I need to waste less time on posting!” There’s actually neuroscience research that reinforces this issue - see our related post, Why Paying Online Community Volunteers Doesn’t Work . Now, YouTube has announced their intention to share ad revenue with those who post original videos as described in YouTube may pay for videos - and we think it might actually work.
Why are we changing direction on the idea of rewarding community content providers? It’s simple - YouTube has the traffic to generate serious money for those lucky enough to post a hit video. Sending someone a check for ten or twenty bucks is likely to remind them of how little they earned for their effort. Send someone a check for thousands of dollars, and they’ll start working on sequels. While we obviously don’t know what the eventual revenue share deal will look like, or how much ad revenue one video can generate, we think it’s a good bet that with popular videos getting millions of views the opportunity will exist to earn a substantial amount of money, at least by video hobbyist standards. The fact that most submitted videos will probably earn a pittance is less important if, and only if, that content creator knows that at least a few of his many peers have hit the jackpot.
Reactions to the YouTube ad revenue sharing concept vary. RustyBrick at the SERoundtable blog predicts an onslaught of spam videos, or “spedios“. Andy Beal of the MarketingPilgrim blog suggests that YouTube will have to solve the problem of identifying copyrighted content before rolling out revenue sharing. Overall, the reaction seems to be positive. One key area this would address is the perception that YouTube is raking in billions while its content providers earn nothing. Wired Magazine recently noted that the actress in the wildly popular LonelyGirl videos was paid a mere $500 a week, while the producers had to borrow money from their parents to make the videos. Fame and publicity are great, but in the long run YouTube and its content suppliers need a more stable relationship. Ad revenue could be a key element in solidifying that relationship.
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