In October, Supper Mario Broth, a cross-platform blogger and video maker who covers Nintendo history, published a heartbreaking plea to his fans, explaining that he could no longer make a living on ad money from his YouTube channel alone. He told his audience that he was starting a Patreon as one last attempt at keeping the project running. Much to the relief of his followers, he quickly accrued several thousand subscribers.
A happy ending? Yes. But Supper Mario Broth is just the latest YouTube creator to say they can no longer support themselves through the platform. In the past year, YouTubers ranging from voice actor SungWon Cho to scientist Dianna Cowern to aviation historian Mentour Pilot have issued direct pleas to their followers for support.
The creator economy is changing. Long gone are the days of the early pandemic when it felt like everyone in America was buying a ring light and taking a crack at a professional life online. A recent report from Bank of America found that the share of its customers reporting income from online platforms decreased by about 20% over the last three years. Meanwhile, at the very top of the creator economy, brand deals are going to fewer and fewer creators. Patreon, while not necessarily being a new platform, has quickly emerged as the new way to fund a video channel.
Garbage Day tracks YouTube channels that receive the most new paid memberships on Patreon each month. Over the past year, 53% of these have been YouTubers. Before that, the top growing Patreon accounts were much more likely to be a diverse mix of podcasters, hobbyists, and people selling erotic fan fiction (porn is big business). Not only that, for 10 of the past 12 months, the fastest-growing Patreon creator has been a YouTuber — or at least a content creator who uses YouTube as a primary outlet.
Long gone are the days of the early pandemic when it felt like everyone in America was buying a ring light and taking a crack at a professional life online.
Complaints about YouTube ad revenue are not new. YouTube pays its creators a portion of the ad revenue from their videos through the YouTube Partner Program, which has been publicly available since 2007. In 2017, YouTube changed both the requirements for making brand-safe content on the site as well as the way the site’s automations determined what channels were eligible. YouTube paid its partners over $70 billion between 2021 and 2023.
In 2020, YouTube rolled out a short-form video tool called Shorts to compete with TikTok. The company was so bullish with this initiative that it announced a $100 million fund to pay its users to create Shorts. But Shorts has never stopped playing catch-up, with YouTube constantly adapting it to be more like TikTok. Last month, the site even extended the maximum length of Shorts to three minutes, going back on comments from a year ago that this would “blur the line” between Shorts and regular YouTube videos.
The push has been a success, with over 2 billion users a month viewing YouTube Shorts as of last year, but the company hasn’t been bragging about its metrics lately. A 2023 report in the Financial Times showed that Google, which owns YouTube, was worried Shorts was detracting from not just longer videos but the site’s entire business model. YouTube ad revenue in general actually dropped in 2022 and still isn’t meeting expectations. In fact, it’s less clear than ever what the difference is between YouTube Shorts content and what should go on a creator’s main channel. YouTube seems less interested in defining what Shorts should be and is now using it as a holding pen for AI features.
This isn’t the first time competition has ruined an entire website’s business model and the financial stability of the creators who rely on it. Take the enormous popularity of drop-shipping services like Temu, which have lowered standards for pretty much everything you can buy online. This has been particularly hard on Etsy sellers — last year, The Washington Post reported on how scammers and drop-shippers can make cheap knockoffs of authentic Etsy items, luring customers away from the original sellers. Etsy has responded by relaxing its restrictions on drop-shipping; as a result, most of their top sellers don’t make what they hawk, going against the site’s ethos as a place for handmade goods that can’t be found elsewhere.
At YouTube, the move from ad-supported revenue to individual Patreon funding could be just as existential a threat. YouTube’s ad program is not just the primary way the platform makes money; it’s also one of the main ways the site incentivizes creators to conform to certain standards. It has an influence on the rate people post, as well as what kinds of content they’re making and how it looks and feels.
At YouTube, the move from ad-supported revenue to individual Patreon funding could be an existential threat.
For instance, if a creator wants to take advantage of all possible ad placements, their videos need to be a certain length. If they want to be approved for those ads, they have to avoid things like profanity or violence. And, if they want to be paired with the best advertisers, they have to fit preexisting niches that YouTube suggests. But if more of its largest creators abandon ads as a primary income stream, the whole thing falls apart.
Earlier this year, YouTube long-haulers The Try Guys announced they were giving up on relying solely on YouTube ads. They said it took about three months to reach profitability. During a round of interviews following the announcement, they said that YouTube would still be the home for their video content, but were clear that subscriptions were their main focus going forward.
Which leads to a much scarier question YouTube should be asking itself: exactly how long will these creators keep using YouTube at all if they’re making their money somewhere else?
Garbage Day is an award-winning newsletter that focuses on web culture and technology, covering a mix of memes, trends, and internet drama. We also run a program called Garbage Intelligence, a monthly report tracking the rise and fall of creators and accounts across every major platform on the web. We’ll be sharing some of our findings here on Sherwood. You can subscribe to Garbage Day here.
Source Does YouTube have a future if its creators have to make most of their money elsewhere?
