Why the Outrage over Daily Grace and My Damn Channel Matters
YouTube’s first business scandal of 2014 is a doozy, with lasting implications for the online video industry
The YouTube community will forever remember last week as the time their current favorite, an up-and-coming lady comedian named Grace Helbig with 2 million fans, told “the system and the man” (aka the company she just left) to go eat a dick.
Except, this is Helbig we are talking about here — MTV’s Best Vlogger of 2013, just listed on Forbes’ 30-under-30 list of 2014 — so it was a lot classier than that. The “Eat a Dick” part didn’t come out until days later, in a video titled “HOW TO START OVER” where she listed advice that spelled the phrase out. To anyone familiar with the space, the community’s sustained digital cheerleading of Helbig’s newfound freedom from “the man” is borderline deafening.
As for My Damn Channel, the entertainment company Helbig just left, the situation continues to be a PR disaster. In the words of a former top YouTuber, the company might very well be “ruined.” Only one out of every 10 tweets (a generous estimate) mentioning “my damn channel” are positive, a week into the scandal.
This PR disaster didn’t come out of no where — it’s been building for more than a month, meaning My Damn Channel had ample time to prepare, and possibly avoid, this type of backlash. Their handling of the situation is also fraught with missteps.
My Damn Channel’s troubles began the last week of December 2013, when Helbig uploaded her final video on her Daily Grace YouTube channel, the one they own. In the cryptic and somewhat awkwardly sincere video blog titled “SEE YOU NEXT YEAR”, Helbig announces she is going on a week-long vacation from the Internet — “it’s not you it’s me, but also the system and the man.” She then thanks My Damn Channel for giving her a job, reminisces on the five years she’s worked for the company and says 2014 will be a little different but still “really really fun.”
Her fans promptly freaked out. Rumors began circulating a month ago that Helbig was leaving My Damn Channel and the two were having content rights disputes, and the “SEE YOU NEXT YEAR” video was interpreted (rightly) as proof. An even more cryptic video on Helbig’s old YouTube channel pre-My Damn Channel days, now called It’s Grace, added fuel to the fire.
On December 31st, My Damn Channel officially marked the end of their partnership with Helbig in a benevolent blog post that also announced their strategy of running “re-runs” of her old videos:
We are happy and grateful for all that we built together with Grace and the best fans ever. Her career will continue to see success after success. She is one of the most talented and hardest-working artists we know, and we are excited to see what’s next. We wish her the very best and hope we can work together again in the future.
The community, however, is having none of it. My Damn Channel’s blog post on Helbig has 136 angry comments, with most demanding the company give Helbig the channel she’s worked on for five years.
In a Tumblr post shared by Wil Wheaton and other digital video heavy weights, Hank Green of the Vlogbrothers wrote on January 1st:
Not owning your content is a terrible (though not unusual) thing…it means that the company who does own your content can hold your stuff hostage and do anything they want with it. They can make you do things you don’t want to do. I’m not saying this is what My Damn Channel was doing to Grace, but I am saying I do COMPLETELY understand Grace not wanting to be part of that anymore.
By populist accounts, My Damn Channel is now an evil corporate villain. Helbig fans are writing nasty comments on old Daily Grace videos bashing the company, disliking the videos, telling everyone to subscribe to Helbig’s new channel It’s Grace and to unsubscribe from Daily Grace. This trend continues on Tumblr and Twitter too. According to statistics monitoring site VidStatsX, Daily Grace saw a drop of more than 110,000 subscribers (!!!) last week.
There’s even mean-spirited animated GIFs about the private parts of My Damn Channel’s CEO Rob Barnett on Tumblr and descriptions of My Damn Channel as commodifying a young woman and turning her into a “corporate entity” (as if this unusual for Hollywood), something even Helbig’s brother joked about on Twitter.
A rhetoric of “How dare they not give Grace rights to her content, hold her account hostage, milk her videos for ad money with re-runs, and what is this business about a binding contract???” prevails, to this day, across social media. Established entertainment industry rules are clearly not welcome in this new media landscape.
The most legitimate criticism out of the whole thing, coming from supporters familiar with how contracts work, is My Damn Channel forbidding Helbig from making a video on Daily Grace about her departure and her new channel. Oh, and also the deleting of the fan comments on the Daily Grace channel telling everyone to go to It’s Grace, which only enraged fans more.
As far as YouTube contract dispute scandals go, this one is fairly tame in that no one is threatening to sue anyone, unlike the Ray William Johnson/Maker Studio spat. No one really cared about Johnson’s content ownership struggles though, because he was never seen as part of the community — Johnson doesn’t even go to VidCon. However, everyone loves Helbig and Helbig is a big part of the community. This is evident in the outpouring of support for her new channel, currently approaching 700,000 subscribers.
In all likelihood, My Damn Channel won’t release the Daily Grace channel to Helbig (binding contract and all) and their brand will continue to suffer for it. This YouTube scandal will, however, have a lasting impact on the types of contracts up-and-coming YouTube talent will sign going forward.
Green, who described this debacle as “one of the most important events in the history of online video,” agrees. He wrote in an email:
“If creators can leave relationships and take their audience with them, networks and production companies are going to be very careful about what they invest in and make sure that they lock creators into iron-clad contracts before spending lots of money on them. And creators…they’re gonna have to make damn sure they need those entities for their success, or signing their life away is going to be a dumb move.”
Is it possible to not sign your life away, and have joint ownership of your content, ie: intellectual property (IP) rights? I reached out to Shaun Spalding, a board member of New Media Rights, to find out and he said it is possible and happens all the time in the web video space, but it’s “not really an ideal situation for anyone” when it comes to profits. If an individual is concerned about a company using their IP in ways they don’t like, then “it’s always better to fully own your IP.” So don’t bother, basically.
The YouTube platform by itself, which allows you to make money from ad revenue, doesn't ask you to sign your IP rights away. One of the most circulated reasons cited for Helbig’s departure (it appears neither party can speak publicly about the dispute) is she would have made more money independently from the ad revenue on her channel had she owned her content than the salary she was getting at My Damn Channel.
At its heart, the Daily Grace/My Damn Channel outrage is about the middle man in an industry obsessed with the “indie” way. As Green explains,
There are a lot of people out there wondering what exactly the middle men are supposed to be doing in this new world… and wondering if maybe they don’t need to be paying them anymore.”
