YouTube Originals: Boon for content creators?

YouTube will soon introduce a subscription-based, ad-free version in India which will showcase Original content

e4m by Venkata Susmita Biswas
Updated: Aug 6, 2018 9:00 AM

The jury is still out on the extent to which YouTube Originals, soon to be introduced in India, will help the content creator community. While YouTube’s financial backing will help elevate the content and revenue for the creators, it is likely that only a selected cohort of content creators will be able to enlist the support of YouTube.

In favour of
Monetisation from YouTube has dropped to negligible numbers over time. “Youtube's inventory revenue continues to grow, but demand from advertisers grows linearly compared to the supply of inventory,” explains Sameer Pitalwalla, CEO, Culture Machine. Therefore, he feels a model where viewers pay to watch content will help content creators generate greater revenue from the streaming service.

Because of the trouble with monetisation from YouTube, content creators are viewing YouTube not as a final destination, but as a stepping stone in their journey to become bigger stars. “Content creators are only using YouTube as a catalyst. Many creators achieve a critical mass of subscribers and following to eventually leverage that to promote brands and products to their followers,” said a business manager of a popular Indian YouTuber.

Losing talent to OTT platforms
Over time, content creators who become significantly popular end up receiving offers from production houses or filmmakers. “YouTube Originals, which will be in the same league as Netflix, will help keep content creators within the YouTube community,” said the business manager.

YouTube seems to have realised that the best content is leaving the platform. Ashwin Suresh, founder CEO, Dice Media, says that content creators are moving away from YouTube and working with OTT players such as Amazon Prime, Netflix, or Hotstar that have much bigger budgets and can take the financial pressure off content creators. Dice Media has recently partnered with Netflix for the second season of Pocket Aces’ web series Little Things.

One of the main revenue streams for content creators is influencer marketing or branded content. But brands tend to dictate the terms of the content, which limits creators. Pitalwalla feels that YouTube Originals will liberate Indian content creators.

“Subscription services have content that's unencumbered by advertising. Indian creators will be able to tell stories that wouldn't be ad-funded, and that canvas in itself, can be liberating,” he says.
Suresh, from his experience of working with Netflix, says that the feedback that his team received from the OTT platform has only helped elevate the content.

Content creators will also benefit from YouTube Originals because unlike OTT platforms, on YouTube, the creators are owners of the distribution channel. “YouTube Original shows will bring us new subscribers and the non-original shows on the platform will also garner higher viewership,” said the business manager.

Subscription model?
Only subscription-based OTTs like Netflix and Amazon Prime Video have not been able to grow at the same pace as freemium platforms such as Hotstar and completely free platforms such as YouTube in India. So will YouTube Originals have a market in India?
“I feel as India grows and disposable income increases, people will purchase luxury goods and services - among which are OTT services. This may happen over a 5-10 year horizon and I think YouTube is setting itself up for that future,” said Suresh. 

Benefits only top 1 per cent
Everything seems shiny about YouTube Originals, but only for the top creators. “Overall, YouTube Originals will only help the creamy layer of creators. They will do some limited work with selected creators,” said a leading YouTuber and stand-up comedian. Suresh accepts that this is bound to happen on any platform, not just YouTube. Hotstar’s first Original show in India was in collaboration with All India Bakchod (AIB) and Amazon Prime Video’s Original debut was Excel Entertainment’s Inside Edge.
“A business will not subsidise the offering for the masses. It will work with those who give maximum value and help them grow. So the top one per cent is unavoidable, but I hope that the selection of that one per cent is more meritocratic on YouTube than other platforms,” says Suresh.

Given YT’s history of funding projects, Pitalwalla feels, “I am sure there will be an academic approach towards allocation.”

In the recent quarterly earnings call, Netflix executives said that YouTube and Hotstar are way ahead of Netflix in the Indian market. This is primarily because one is free and the other is easier on the pockets of Indian viewers. Content-wise Hotstar has few Original content shows than competitors like Netflix. Whether or not YouTube Originals will give stiff competition to the OTT players in India depends on the subscription cost in the price- sensitive Indian market and the creators that will parter with the streaming giant.

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