How byte Is Avoiding Vine and YouTube’s Monetisation Mistakes
Vine’s successor ‘byte’ has outlined a unique model for sharing ad revenue, to help it win favor with creators, and it’s unlike anything we’ve seen from other video platforms.
Vine didn’t have a great relationship with its creators. The app helped to launch the careers of many who still boast immense popularity — Logan Paul, Liza Koshy, David Dobrik. But even before the app’s demise, many had removed mentions of Vine from their social media bios, as they abandoned it for YouTube or movie roles.
Before the end, 21 of the app’s 50 most popular creators tried to express their frustration directly to Twitter, which had bought the app. They wanted key app features to improve. They wanted a more direct line to decision-makers. And, above all, they wanted to get paid for posting on the platform. Negotiations broke down, creators abandoned the ailing app; Vine withered.
Launched just over a week ago by one of Vine’s original founders, ‘byte’ is making clear that it wants a better relationship with creators. Those selected for its newly announced “Partner Programme” will benefit from access to experimental features and more direct communication with developers. Crucially, in a play that puts it ahead of its biggest competitor TikTok, Byte will also share advertising revenue with creators. But, not satisfied with simply being distinct from Vine, team byte has devised a revenue-sharing model that is altogether different from anything we’ve seen from other video sharing platforms.
100% of Ad Revenue to Creators
That’s right. Byte is giving 100% of advertising revenue to partnered creators. At least, initially. The generosity will last while the Partner Programme is in pilot. However, the “long-term plan is to have a majority of the revenue going to creators”. The rest will help cover running costs.
As a basic comparison (and there are caveats): YouTube takes a 45% cut of ad revenue; Twitch takes 50% of subscription revenue; TikTok doesn’t share and currently keeps all of the revenue from platform ads.
Any revenue sharing model is likely to grab the attention of creators who post on other platforms; if they can easily push their audience somewhere and profit from doing so, it makes sense to do so. But byte’s being bolder than that. Giving creators 100% goes beyond the norm and reinforces byte’s “creativity first” branding, positioning it as a platform that has creators’ best financial interests at heart.
Pre-Roll, In-Feed and Retargeted Ads are Out
Continuing its departure from pretty much every other platform’s model, Byte will not host ads that disrupt the content viewing experience. This means no ads playing before videos, as they do on YouTube, and no ads in the following feed, like you will find on Instagram. There’ll also be no retargeted ads — the ads that seem to stalk you from site to site, trying to sell you something you may have once expressed interest in.
Instead of these tried and tested approaches, byte wants to partner with brands to host more creative sponsored content, in keeping with the platform’s style and energy. That content will be promoted via a “sponsored” section in the app’s ‘Explore’ tab. In a quick win for byte, the slot’s first resident is Nike, which is regularly at the forefront of creative advertising.
How this approach can scale is yet to be seen. The current solo slot doesn’t offer a lot of advertising real-estate. But it’s early days for the app. byte’s team has been clear that this is just the first step, and they’re still toying around with other features and ideas (more on that at the end).
“Viewership Brackets”
Arguably the most interesting element of byte’s approach is how it’s dividing creators into “Viewership Brackets” to determine their share of the revenue. Here’s how it’ll work:
- A partnered creator’s views within a 30-day period place them into a Viewership Bracket e.g. 1,000,000–1,500,000 views.
- All creators within that bracket will then receive the exact same payout.
- Creators in higher brackets will earn more money.
By comparison, and to put it simply, a YouTuber’s pay depends on who watches their videos; advertisers pay more to reach certain audiences. For example, personal finance videos receive high payouts because banks are competing to advertise in front of viewers looking for guidance on managing money. This means one video can earn much more, or much less, than another with the same number of views. It’s an unpredictable and unequal system. And if your views are low then you’re unlikely to make much money at all, no matter who’s watching.
Byte hopes its new model will allow it to “evenly compensate a greater number of creators”. There are two major ways a bracket model could accomplish this. First, it will mean creators won’t make less money if their audience isn’t important to advertisers — as long as they’re getting views, they’ll get paid the same as other similarly popular creators.
The second is more speculative — Byte won’t necessarily need to do this, but it’d be in keeping with its broader approach. This model could be used to ensure that even those in lower brackets receive reasonable payouts, in order to encourage smaller creators. Let’s illustrate what that could look like with some made-up figures:
- Bracket 1, say 10,000 to 100,000 views, could receive a byte payout of $5k, whereas they’d get up to $1k on YouTube
- Bracket 2, say 100,001 views to 999,999 views, could receive a byte payout of $10k and would get roughly the same on YouTube
- Bracket 3, say 1,000,000 views+, could receive a byte payout of $25k, whereas they’d get up to $30k on YouTube
All of those numbers are speculative. The point is that those in byte’s lowest bracket wouldn’t make a lot on YouTube. But byte can distribute the pot of ad revenue more evenly. In doing so it can better encourage the smaller creators it chooses to partner with and grow the platform’s talent pool.
Controlled Partner Pool
Making the most of its fresh start and smaller userbase, Byte is vetting each creator it allows into the Partner Programme, and will only add new creators every 120 days. This will allow Byte to stay closer to its partnered talent, which is something YouTube has struggled with as it’s grown.
YouTube’s scale has meant, at times, it has run advertisements alongside unsavory content, created both by popular YouTubers and more nefarious third parties. At points, advertisers have protested against this by reducing the money they spend on YouTube ads— it looks bad for them if their ads run alongside off-brand content. One controversy caused by a rogue channel running adverts can tarnish the entire platform’s advertising credentials. Despite changes to prevent this, YouTube is just too big to vet every channel.
Byte isn’t yet serving ads directly alongside specific creators’ content as YouTube does, and as such doesn’t run the same risks. But this phased and considered approach allows byte to maintain a more intimate relationship with its partners. It means they can remain confident that partners are producing content in line with the platform’s policies. As they roll out new ways to advertise on the app, a group of well-vetted content creators will be an attractive option for advertisers.
What Could Be Next?
Byte’s approach is interesting. The endorsement from Nike at launch is great. Putting creators first is a really positive message. However, if the app’s going to grow, and secure an audience that makes it worth both creators’ and advertisers’ time, it has serious questions to answer. Questions about scalability, and how the app itself intends to make real money (beyond what it needs to cover running costs).
Team byte has made clear that the current approach is only one of the ways they’ll monetize, or help creators monetize — not the only way. But they’ve ruled out some of the conventional methods, which means they’ll have to get creative. So what could possibly be next?
With a focus on sponsored content that fits the platform, great knowledge of and relationships with a curated set of creators, and a perception that they put creators first, Byte has set the stage to do something others have tried to do: insert themselves into creator’s brand deals.
While Vine stars weren’t getting paid from ads, many were securing six-figure brand deals. Instagram influencers continue to make thousands from individual posts. The influencer economy is worth billions, but platforms touch little of this. YouTube, Facebook, and Twitter have all dabbled with integrating influencer marketing agencies to get in on this. byte has the potential to make it a core part of the business.
byte will need to do a lot more than pay creators, and help them with lucrative deals, to be a success. But if team byte can strike a good balance between hosting original content and monetizing it, without failing creators, they’ll have not only learned from Vine’s failings, they’ll be teaching the rest of the industry how it’s done.
