BLOG POST BY: Rowan Byers
May 20, 2022

Twitch Is On The Verge Of A Creator Crisis Following Pay Cut News

Twitch has been the HUB for live-stream gaming and content creators for over a decade. Until recently, the platform has faced very little in the way of competition, then all of a sudden creators on the platform started dropping like flies.

After losing a handful of its largest creators to YouTube over revenue disputes, Twitch is now fanning the flames with the potential of further pay cuts for its creators. 

In this article, we’ll review the latest news around Twitch creator revenue cuts, and how the fabric of the live streaming sector could be about to face titanic changes.

Article Highlights:

  • Twitch creator revenue cuts explained
  • Shifting the tide of the live streaming sector
  • Creators reactions to Twitch revenue cuts

Twitch Creator Revenue Cuts

Recent Bloomberg reports revealed that Twitch has hatched a plan to bolster the revenue in which the platform receives. This scheme involves reducing the revenue share for streamers from 70% to 50%. In addition to these reductions, the report also suggests that a new system is also set to come into place, which will allow creators to graduate through tiers of revenue splits based on specific metrics.

Twitch also wants to boost its ad revenue. This was highlighted back in February with the launch of an ads incentive program. Creators are issued bonuses for streaming a set number of hours using a specific number of mid-roll ads. By increasing the number of ads on creator channels, it is tipped that content generation on the platform will rise, which Twitch can then monetise. 

From the platform’s perspective, a more lucrative model for streamers and creators is under development. However, the creators might see it differently with their income significantly decreasing – and with even more ads, does this pose a threat to the user experience on Twitch?

How Will More Ads Affect User Experience on Twitch?

YouTube Gaming has upped the ante in an attempt to shift the dynamic of the market share in the gaming industry. Recent platform updates like the go-live together feature, which enables creators to invite guests to their streams, and the addition of a full-screen live with Q+A capabilities highlight YouTube’s desire to compete.

Twitch has held firm at the top of the ladder for a long time, 71 million hours of watch time per day, and upwards of 9.2 million active streamers monthly are both representatives of that dominance. 

New players like Mixer have entered the gauntlet but, ultimately, underestimated the requirements to compete at such a level. Intensive competition, high cost of maintaining the product, lack of community building, employee turnover and technical issues ultimately resulted in the platform’s demise.

Live content as a whole seems to be a burning priority for major social platforms generally. Instagram and TikTok are frequent with new updates and features that are catered to their live functionalities. In fact, Instagram recently installed a moderator function for its live content, and as we know live stream moderators share a close affiliation with the gaming sector, acting as protectors of the live chat by preventing harmful comments and constructing a safe community. 

Could it be that Instagram is preparing for a shift in the live streaming vertical?

Twitch Creator Revenue Has Been An Issue Before

Naturally, the Twitch creator revenue report has sparked quite the debate about what the reasons might have been for leaving Twitch. While some streamers like Dr DisRespect have chosen to remain silent on the matter, others like TimTheTatman and Valkyrae were open to explaining the motives behind their departures.

When Valkyrae announced that she would be leaving Twitch in early 2020, it was clear that the promise of significantly increased revenue was the decisive factor. Whilst stating that YouTube offered more money than the Twitch creator revenue split, it offered security, less stress and concern over the fact that Twitch partners can be fully dependent on the financial support of their viewers. She also spoke of her desire to switch up her content and venture into new fields. 

Since the transition, Valkyrae has co-founded lifestyle brand 100 Thieves, featured in numerous music videos and even ventured into the skincare market – although that didn’t play out too well.

Ludwig is another notable Twitch departure that made the transition to YouTube, back in November last year. In a YouTube video titled ‘Why I left Twitch,’ Ludwig revealed how he was actually using YouTube to get a better offer from Twitch, which ultimately did not happen, therefore causing his departure.

Sykkuno is the latest streamer to upship. The now former Twitch streamer announced a new deal with YouTube that will see the creator live stream exclusively on the video-sharing platform. 

Like most streamers, Sykkuno has operated between YouTube and Twitch simultaneously, usually streaming live on Twitch, and then repurposing the contents of a stream into smaller clips that feature on his YouTube channel. This is another motivating factor for streamers moving to YouTube, in that they can put all their focus into one platform, their live streams and entertainment content resides all in one place, a factor that helped pull Valkyrae over to the platform.

Sykkuno’s new deal with YouTube means that the creator will no longer operate on Twitch, which is important as YouTube Gaming is looking to take a larger share of the streaming market, one that is pretty much dominated by Twitch.

Twitch Creators Are Unhappy With Latest Pay Cuts 

Top creators are voicing their concerns over the changes to Twitch creator revenue. Many streamers have come forward to express their discernment with the news, stating how such changes would make life harder and could force them to shift to another platform.

Tucker Boner, or Jericho as he’s most commonly referred to on Twitch and YouTube, had this to say:

Popular Irish YouTuber, Jacksepticeye also expressed his frustration on Twitter, saying:

Twitch streamer Hasan Piker described it as “wild” that the platform didn’t consider its current revenue splits to be profitable enough, going on further to say: 

Twitch only makes moves like this because they think there is no competitor in the livestreaming space. Mixer is dead, Facebook is a black hole for relevance, and YouTube is too big to care about live streaming and too slow to change.”

Evidently, the overall sentiment towards the potential pay cuts is a distasteful one. Twitch streamers have been seeking greener pastures because they feel as though the platform does not support them well enough financially. Should these revenue measurements come to fruition, the trend of creators leaving will likely spread like wildfire.

The Goat Agency Insights Team will keep you up to date with all the latest developments on this story. Follow us on LinkedinInstagram and Twitter for real-time announcements of all our new content.

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Written by: Rowan Byers

Insights Executive at The Goat Agency