In these days when people spend their time in their homes because of the coronavirus outbreak, video streaming platforms like YouTube are getting more views than ever. So, did these increased usage amounts increase YouTuber’s revenue?
Due to the coronavirus pandemic, calls are made all over the world to keep people at home. Curfews are also declared in many countries. While some companies switched from home to work model, some companies stopped their activities, causing people to become unemployed.
All of the above factors allow people to spend more time at home than in the past. Nowadays, when more time is spent at home, video platforms, video conferencing applications, series and movie broadcasting platforms have been used more widely than in previous periods. So does the increase in the number of views on platforms like YouTube cause the revenues to increase?
Viewing numbers are increasing, but revenue is not increasing
During the coronavirus epidemic, YouTube is seeing more demand than other platforms. The number of views and watch hours on the video broadcast platform has increased significantly compared to previous periods. The increase in these numbers brings with it an expectation that content producers will increase their YouTube revenues. However, this is not the case.
What happened in the last few weeks shows the opposite direction of expectations. YouTube videos are watched more and people spend more time on YouTube, while YouTubers’ revenues are watching at lower levels than in the past. Despite the increase in the number of views, the fall of YouTuber’s revenues is due to the nature of online advertising.
How is YouTube’s ad revenue determined?
YouTube’s CPM system, called “cost per 1000 impressions”, lies at the root of the problems YouTubers are currently experiencing. CPM is not just a system implemented by YouTube. Websites also earn ad revenue or distribute ad revenue through a similar ad display system.
YouTuber’s revenues are basically determined by CPM. When ad revenues are high, YouTuber also earns more than the number of views. However, even though the number of views increases when the ad revenues decrease, the price per view does not increase.
Coronavirus days can be used as a good example to explain changes in advertising revenues. Organizations advertising due to the coronavirus epidemic do not advertise as much as before. This causes competition in YouTube ads to decrease. The falling competition ensures that the ads are given with lower payments. For this reason, even if the content is displayed more, ad revenue cannot be obtained as much as before.
Shesez, one of the famous YouTubers, exemplifies this situation on his own content. Shesez has revealed that his video, which he has released recently and has reached 350,000 views, has generated less revenue than his video published on March 15 that has received 200,000 views. Shesez stated that the difference is one quarter of the difference.
The content that generates almost twice the amount of views generates less revenue is due to the CPM implementation described above. Almost all of the people who are currently producing content for YouTube and those who earn ad revenue on the Internet state that they have encountered similar problems.
We can summarize the whole issue as follows: Getting more views on YouTube may not always lead to more revenue. As in these days when coronavirus pandemics are experienced, even though the content is displayed more when the advertising income decreases, the content producers are not offered more income.