Twitch’s money man talks about the revenue-splitting controversy and his monetization long game – LSB

Twitch has had a busy year, in part due to community backlash over policy changes affecting how creators can monetize their content.

Last year the company announced that it would end the 70/30 subscription revenue split deal it had offered select streamers in favor of prioritizing ad revenue. In June, Twitch launched Partner Plus Program, a new monetization tier that will give eligible creators a 70/30 share of subscription revenue on the first $100,000 they make per year. The program further strained its relations with the community, as the qualification requirements exclude the vast majority of streamers. Streamers need at least 350 monthly paid subscriptions, and gift subscriptions and monthly subscriptions that come with an Amazon Prime account don’t count.

In response, Twitch rotated eligibility to a points-based system, assigning a value to each subscription level. Higher priced subscriptions now count more toward your points total.

Twitch has also backed away from its policy limiting inline ads and other sponsored content, following the fallout from streamers who depend on branded content for the majority of their revenue.

The company’s CEO Dan Clancy, who took over earlier this year, has prioritized engaging with Twitch streamers and incorporating their perspectives into future policy changes. The company’s receptiveness to community feedback has marginally reduced hostility from its streamers and community sentiment toward Twitch at this year’s TwitchCon in Las Vegas was significantly more positive than last year. New features and policy changes announced during the convention’s keynote, including giving streamers more control over ad breaks and allowing simulcasting to other live streaming platforms, also reassured the Twitch community.

In an interview with TechCrunch, Twitch’s chief monetization officer Mike Minton discussed unpopular policy decisions, supporting smaller creators through branded partnerships, and what Twitch is doing to repair its relationship with its community.

Twitch Chief Monetization Officer Mike Minton addresses the crowd at TwitchCon Paris.

Mike Minton at TwitchCon Paris earlier this year.

TechCrunch: I’m going to start off with a possibly cheesy question, but Twitch has made some unpopular decisions regarding monetization. Is there anything Twitch is doing to appease angry creators?

Mike Minton: We said two years ago that we would no longer do these deals that were not objective in terms of eligibility criteria. We have completed this program. It affected a relatively small number of creators, but what really affected it was the community saying, “I have nothing to work for.” And that’s what led us to recently announce Partner Plus. There was feedback saying, “Hey, we’re going to need a lot of subscribers,” and we responded to that by making it sub-capable so that your higher-priced subscriptions cost more, and that’s actually been pretty well received positive.

Both Dan and I have said in different ways that this is the beginning. This is not the end and we will continue to work to provide access to higher turnover shares as we can over time to more streamers.

What would that look like?

The simple answer now is that 350 was the criteria we established, right? And this number is arbitrary and can easily be reduced. Now our goal and our goal in this program remains the same. We’re looking to benefit creators where live streaming is a significant part of what they do as creators. This allows us to focus on those streamers who are really at a point where it will matter the most to them in terms of keeping them as a live stream creator.

That’s right, and this decision to change revenue distribution also stems from a decision to prioritize advertising revenue. Creators and viewers have said that integrating ads into their streams is very frustrating. What kind of feedback will Twitch provide in response to this?

Let’s set a few things straight. So one of the things we knew with ads, if we wanted to get streamers to buy ads as a good way to monetize, is that we had to increase revenue share, which we did, and start the ad incentive program.

We help streamers understand that with ad serving, you need to think about it consistently over time to earn predictable revenue. This is a very reliable source of income for many streamers.

So I think the combination of making it easier to execute, increasing revenue share, and then recently in the keynote we talked about two new features that allow moderators to know when an ad break is coming and adjust the ad break around the content because the problem with the live broadcast, as you know, is what people don’t want to miss. So we’re very focused on improving the ad experience by allowing ad breaks to be synced with content and logging moderation and ultimately the community fixing those ad breaks.

As you said, live streaming is very different from static content and the monetization tactics that work for Instagram or TikTok just don’t really work for Twitch or any other live streaming platform. In these cases, what has made Twitch different from these more standard platforms in terms of more seamless monetization?

One thing we’ve done since the beginning, where we’ve been a leader, is to get people to pull out their wallets and support creators through subscriptions, gifts, applause. I think that makes us a unique community-based platform where viewers directly support creators in this way.

Other services have tried it, but from what I can tell them, what streamers have told me, is that Twitch is really the leader in this sense. We spent a lot of time on advertising because there isn’t a social media, content distribution service in the world that doesn’t rely on advertising as a component. So ads are a big focus.

And the third part where we are behind is sponsorships. Now we’re very focused on increasing sponsorship opportunities for streamers and making sure we have three — based on your size, where you’re located, how experienced you are, what type of content you’re creating, where you’re re-found in the world — three opportunities to support you as a creator.

I’ve spoken to many creators over the course of my career and a common complaint seems to be that they can’t support themselves on subscriptions and ad revenue alone. They have to have these branded partnerships that are difficult for mid-sized creators and smaller creators. What specifically is Twitch doing to diversify its branded affiliate content?

We have this unique opportunity because we are part of the third largest and fastest growing advertising business in the world, AKA Amazon. So what we’re actively working on is as advertisers that come through Amazon advertising, they understand the magic of Twitch that they can easily create deals with influencers programmatically. And you end up not having the measurement they expect.

But because of the diversity of Amazon’s advertisers, it’s where previously it was more focused on native advertisers, game publishers, etc. And now we’re able to extend that reach to a much wider range of advertisers and serve the needs of both affiliate marketing and sponsorship, which is more of a performance model, as well as the top of the funnel where you’re looking more brand recognition.

Apparently, much of this disagreement among the Twitch community also comes at a time when other streaming platforms like YouTube or Kick are starting to grow and lure streamers with a better revenue split. A common complaint I’ve heard is that bigger streamers will make money wherever they are, but smaller streamers who have smaller audiences don’t qualify for Partner Plus will get better deal on YouTube or Kick than on Twitch. What is Twitch doing to keep these streamers?

There are a few things I will point out. One is recognizing what Dan has done as CEO to go out and engage with streamers and hear their concerns and really influence our priorities as a company is actually a consequence of him being an active streamer , as well as being highly engaged within a community.

And then, more broadly for both Jeremys [Jeremy Forrester is VP of Community Product] and I as product leaders, building the product continue to innovate and ensure that we are an absolutely unique service. Whether it’s features like we’re working on Stories, whether it’s monetization — it’s all in service of making sure live streamers can be more successful on Twitch.

For a long time there was something like exclusivity with Twitch, where there were exclusive deals and simultaneous streaming on other platforms was prohibited. I have to wonder if these decisions to change these policies were in response to competition from other platforms.

I would put it this way: I think they are an acknowledgment and maybe a closer connection to the community through Dan specifically. I admit that Dan, in his short time as CEO, did make some big and tough decisions. Both the launch of Partner Plus and the simulcast, the embedding stuff that we talked about in the keynote — those are three things that I think are very much in recognition of the feedback from the community. We made this change, so I wouldn’t call it due to competitive pressure. I would call it out of focus on the community.

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