VidCon a chance for fans to see online video stars in person

25 Jul 2015 | Author: | No comments yet »

Teen stampedes are a thing of the past at Vidcon.

A swarm of spontaneous selfie sessions has commenced in the lobby of the Anaheim Convention Center as hundreds of fans have gathered for impromptu interaction with folks they watch online. Google’s YouTube, looking to squeeze new coin from the millions of free videos on the service, aims to launch a subscription-based service later in 2015 that will strip out all ads.The company rolled out 360-degree video earlier this year, with the ability to interact with videos by dragging the mouse to move the image – the same way you would in a first person perspective video game.When 29-year-old YouTube star Meghan Tonjes launched a podcast with crowd-funding site Patreon a year ago, it was one of dozens of things the singer-songwriter was doing to grind out a living online.

GOOG -3.22 % ’s incumbent service and new rivals looking to lure away top online video talent. “Everyone is interested in other platforms to diversify or to develop new audiences,” said Hank Green, host of popular YouTube shows such as “Crash Course” and a co-founder of VidCon. This is reported to improve viewing times on adverts – thereby increasing their value – because users can interact with them by controlling what they see. It’s simply a sea of human energy. “This is why you come to VidCon right here,” says Nicole Perret, a 16-year-old high school student from San Diego, as she waits to pose for a photo with YouTube personality Olan Rogers.

And from their fervor sprang one spontaneous bum-rush after another — one fan would spot a mark, start running and shrieking, and the horde would follow (whether they knew who they were chasing or not). “That’s why I’m here,” said one yellow-clad guard who was situated in the middle of the floor, his eyes darting around the lobby even as he spoke with me. “To stop people from running before they start.” What fans are allowed to do: Line up politely for a hug, quick chat and a selfie with their favorite YouTube channel makers. When viewed on mobile, users will be able to change their perspective in the video just by moving their phone, just like the mouse interaction that works on a desktop computer. Along with posting performance videos on YouTube, touring, selling songs on iTunes and ”vlogging” (video blogging), Tonjes sits down twice a week with her roommate in Los Angeles to talk about ”Adventures in Roommating.” Nearly 100 online patrons donate a total of close to $700 per podcast, just to listen and maybe get a shout-out. ”If YouTube disappeared tomorrow, I want to know that I can go play shows, do podcasts and live without being dependent on one site or one app,” she says. In its sixth year, such frenzied exchanges are commonplace at VidCon, the annual celebration of online video that kicked off Thursday and continues through Saturday.

The lineup process was also new on the convention floor this year, although it wasn’t all that organized — these were just spontaneous meet-ups — and it was happening everywhere you looked. This spring, YouTube informed content partners that they must get on board — otherwise, their channels will be made private and won’t be eligible for ad-revenue sharing. But the most exciting announcement is that full virtual reality videos will soon be supported on the app, using a just a phone and an easy to assemble cardboard mount.

With YouTube taking about a 45 percent cut of ad revenue from videos posted on the site, YouTubers and companies that manage them are hunting for new ways to make money from the audiences they’ve built on the platform. YouTube also said it would provide special camera rigs that support the format at its studios around the world, including at two locations opening next year in Toronto, Canada, and Mumbai, India. That kind of pressure is forcing YouTube to forge better relationships with popular creators, finding them opportunities for growth and in some cases paying them more. YouTube is currently looking to launch the subscription-video service in late Q3 or early Q4 but may end up pushing back the launch to early 2016, according to sources.

These cheap little boxes, called Google Cardboard, have been around since last year, and turn your phone into a a mini virtual reality device like Oculus Rift. ‘You’ve got an amazing camera in your phone or tablet, and now you can trim your footage, tint the image with filters, add music, and upload – all inside the app. A lot of those fans have started channels of their own — just look at all the kids off on the sidelines, shooting on selfie sticks and tripods — making them less likely to be starstruck. YouTube now has a division that focuses solely on its “top creators,” addressing their complaints, helping them to craft new material and generate more revenue.

They are the leading edge of a legion of gamers who videotape themselves while playing games and narrate the action as they go, cracking jokes, screaming and swearing to the delight of their many tween, teen and twentysomething fans, who would rather watch another person play video games online than play the games themselves. “Watching people play video games seems like the craziest concept to some folks. Robert Kyncl, head of content and business operations at YouTube, welcomes the challenges to its online dominance, even if other platforms are enticing creators with better cuts of revenue. They’re also not content only producing online videos. “It’s a really big problem that we all continue to have,” said Rafi Fine, one half of the Fine Brothers, who have amassed over 12 million subscribers and crossed over into TV with shows for Nickelodeon and truTV. “It’s holding us all back. The team tries to steer the best videos to “Google Preferred,” which makes the top 5% of YouTube content available for advertisers to buy upfront at premium prices. “I want to be running a platform that they can stay on, that they can grow up on and extend their work even further,” YouTube chief Susan Wojcicki said in an interview.

And to folks who watch them, it seems as normal as anyone watching any other type of show,” said Matt McLernon, spokesman for the predominant forum for posting and watching such videos: YouTube. Instead, she focused on enhancements to YouTube’s mobile apps, which include support for full-screen vertical video, and touted production tools at YouTube Spaces for shooting 360-degree and 3D video. Facebook announced this month that in the fall it would start sharing ad revenue with a select few creators like the NBA, Fox Sports and Funny or Die.

In a separate interview with the Wall Street Journal, she insisted the video-subscription service was making progress despite some holdouts. “There are some partners outstanding,” Wojcicki acknowledged, “and we’re still in the process of working through that with them.” She added that YouTube has secured agreements with content partners representing more than 90% of watch time. Video-game streaming service Twitch already shares subscription revenue from followers with top gamers, and a site called YouNow allows online fans to give tips to talent with coins bought with real money in live stream forums. Many make their money off the revenue from advertising that runs before their videos, as well as from product placements inside their videos and from merchandise sales, such as T-shirts and posters Every month, viewers literally watch billions of hours of gaming on YouTube, and that astounding figure is growing.

Everything from ”unboxing” videos of new gadgets and how-to videos that show off teeth-whitening products are providing YouTubers a solid revenue stream. That trend was evident on opening day of VidCon, Thursday, where a panel called “What Makes A Good Gaming Channel” was attended by hundreds of wannabe YouTubers, including 15-year-old Winston Jones of Murrieta, who had already set up a YouTube channel and planned to post his first video Sunday. “I came to VidCon pretty much just to learn stuff about gaming,” said Jones, who has been playing video games since age 5 and who will launch his channel with a video of himself playing Minecraft – the game that is credited with launching the Let’s Play genre. FameBit, a Santa Monica startup, launched a marketplace last year where creators bid on the right to make brand-sponsored videos, and deals close for, on average, $500 per video, says Agnes Kozera, the company’s co-founder and chief operating officer.

YouTube has a poor track record of making consumers part with their money: a pay-channel initiative failed to take off two years ago, and its streaming movie-rental service hasn’t registered much action apart from Sony’s “The Interview.” No content in the pay service will be available exclusively. A YouTube representative helped Elise Strachan, creator of the popular channel “MyCupcakeAddiction,” apply for a grant from a joint venture between the Australian government and Google that funds higher-quality online video production. Also launching this week is an app called Social Bluebook, which benchmarks how much creators should ask for such digital promos, including on platforms like Instagram and Twitter. But while some speculated that YouTube’s SVOD would be akin to Netflix, with a bucket of premium video behind a paywall, the service actually is more like Spotify Premium: same lineup of stuff, just without the ads.

That model has worked for Spotify and others, but it’s not clear it will work as effectively for video (especially given that many YouTube ads can be skipped after a few seconds). Two movies starring YouTube sensations are debuting around VidCon, including ”SMOSH: The Movie,” featuring comedy duo Ian Hecox and Anthony Padilla, and ”The Chosen,” a horror flick featuring vlogger Kian Lawley. In addition to Let’s Play, there are channels from so-called creators who use the characters from video games to tell narrative stories that are completely separate from the games in which the characters originated, and channels for battles between different teams of online gamers that are videotaped, edited and streamed online. The popularity of video game channels on YouTube is “a close harmony of two things,” said McLernon. “There wasn’t a dedicated channel on television talking about the latest games. They won’t be the first feature films starring YouTubers and they won’t be the last, says Barry Blumberg, chief content officer for SMOSH backer Defy Media.

Among the hundreds of featured creators, or YouTube celebrities, at VidCon were dozens of web stars who specialize in video game content, including FLitz from Smosh Games (with more than 6 million subscribers) and Matthew Patrick of The Game Theorists (with more than 4 million subscribers), both of whom participated in a panel discussion Thursday before a lively audience donning video game T-shirts and skull caps. “It’s a phenomenal job and it’s incredible to form a connection with an audience and fans who are just as excited about over-thinking your favorite passion as you are,” Patrick told the crowd. “That said, it’s a hard job. YouTube will take a 45% cut of subscription revenue (as it does on advertising), with the rest divvied up to partners based on aggregate subscriber viewing time.

YouTube personality Kayla Lashae, 22, who has made a living for three years with videos about trying out bags and testing things like electric toothbrushes, says it’s a good idea to branch out with the co-hosting gig. Vessel, run by former Amazon.com AMZN 9.80 % and Hulu executive Jason Kilar, is one of the rivals offering lucrative payouts if creators post first to the startup. And earlier this month, German broadcaster ProSiebenSat.1 merged its Studio71 with Collective Digital Studio, a Los Angeles-based network behind such brands as Epic Meal Time, Video Game High School and Just Kidding News. Part of the rationale is to take formats that have worked in Germany, like the head-to-head video game challenge show, ”Last Man Standing,” and transport them to different markets with local talent, says CDS CEO Reza Izad.

The merger will also help build up advertising sales forces in countries where consumers are watching videos that don’t have ads sold against them. ”You want to grow (ad rates)? YouTube originally approached networks to see if they’d be interested in providing full-length episodes of TV shows — the thinking being that an ad-free environment would be a big draw. Akana isn’t getting as many views on Vessel as she does on YouTube but said she is making a larger, steadier income, including a minimum annual income.

That’s because YouTube is offering the same rev-share terms as on the ad-supported side, and networks can better monetize their shows on their own outlets or established SVOD platforms like Netflix or Hulu (whereas YouTube’s subscription service is unproven). There are plenty of genres that work in other markets, like sports, dance, and fashion, says Peter Csathy, CEO of venture capital firm Manatt Digital Media Ventures. ”Those things are not language dependent and they’re naturals for international reach,” he says.

In fact, the YouTube video-subscription service may have the effect of prompting TV networks and media companies to share less content — which today is nearly entirely promotional, in the form of short clips — because they may have contracts with other distributors specifying exclusivity in the SVOD space. But consider this: YouTube Music Key, the music-streaming service Google launched late last year in beta, is regularly priced at $9.99 per month (with a $7.99 intro price). Strachan said. “I honestly don’t know which will be the better option.” Vimeo, which is owned by IAC/InterActiveCorp, is launching a new series in September that is packed with YouTube stars such as PewDiePie and Grace Helbig. Given that YouTube’s goal is for every video it hosts to be on the SVOD service, including music vids, it stands to reason that the monthly fee for ad-free YouTube will be either the same as Music Key — or higher. (There’s been speculation YouTube will fold Music Key into the SVOD service, but Google currently expects to keep them separate products.) Is ad-free YouTube worth more than Netflix? It’s questionable whether the other features promised for the service — offline video viewing and playback on mobile devices while other apps are in use — will be enough for users to open their wallets.

The Internet colossus touted YouTube’s momentum in reporting Q2 earnings last week, claiming the top 100 advertisers on average spent 60% more year-over-year, and that YouTube mobile viewing alone attracts more U.S. viewers 18-49 than any single cable network. That means, for the most part, that users have to search for videos or discover them via algorithm-based suggestions (not human curation). “YouTube is a hard place to find the thing I don’t know I want,” said an exec at another large content partner. “In order to be a subscription service, you have to understand content.” That said, YouTube could be accelerating efforts to get the right content in front of the right audience: This week it announced Susanne Daniels, MTV’s former president of programming, as head of original content development. But Wojcicki and other execs clearly believe the initiative is worth a shot: After all, even if only a tiny percentage of YouTube’s 1 billion-plus monthly users pay up, that could be a significant amount of new revenue. “I love the idea of multiple revenue streams,” said a senior MCN executive. “The challenge is, I’m not sure it’s an offering consumers are going to pay for… We’re not sure it will work.”

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