Bloomberg reported that Twitch (which is owned by Amazon) is reportedly weighing changes to how it pays top talent, according to people familiar with the planning. It appears Twitch is doing this to boost its profits – while at the same time, alienating some of its biggest stars.
The updates under consideration would offer incentives for streamers to run more ads. The proposal would also reduce the proportion of subscription fees doled out to the site’s biggest performers, said the people, who asked not to be identified because the discussions are private.
According to Bloomberg, some changes to Twitch’s monetization structure could be implemented as soon as this summer. Twitch staff is considering paring back the revenue cut of channel subscriptions granted to the top echelon of streamers in its so-called partnerships program to 50%, from 70%. Another option is to create multiple tiers and set criteria for how to qualify for each one. In exchange, Twitch may offer to release partners from exclusivity restrictions, allowing them to stream on Google’s YouTube or Facebook.
For The Win (via Microsoft News) reported that these changes could go live as early as this summer, or could be scrapped entirely. Currently, top-tier streamers earn as much as 70% of revenue from those who subscribe – $3.50 on every $5. These plans are looking at reducing that to 50% and increasing the rewards for running ads. Other possibilities include a sliding scale of rewards based on popularity and, presumably, profit generated.
For The Win also noted that ads on Twitch have become common and harder to avoid in recent years, with most major ad-blockers failing completely or being countered by Twitch’s own measures. The ‘purple screen of death’ that blocks content for 30 seconds every so often when an ad-blocker or other outside-influence is detected is infamous.
PC Gamer (via Microsoft News) reported that Twitch has already been doing a harder push for ads on the site this year. According to PC Gamer, Twitch is incentivizing streamers to run more ads by offering $100 for running 2 minutes of ads per hour, with proposals in place to create a new revenue-sharing model for ads.
In my opinion, pushing more and more ads isn’t a good idea. Ads prevent viewers from watching the game play of their favorite streamers. There will absolutely be a breaking point if the number of ads – and how often the ads are served – is overwhelming. People who are frustrated by the ads will leave Twitch – and that will make it even harder for streamers to make money through subscriptions.