As Social Shifts To Video, Content Creators Win Power And Dollars
In December, a pack of widely followed Vine stars made their way to Twitter's San Francisco headquarters for an unprecedented meeting. These stars, who helped propel Vine to popularity by creating a unique brand of entertainment to fit its short, looping format, wanted to finally get paid for their work. Other social networks had plans in the works to pay content creators, and these Viners wanted in too. It was a bit of a watershed moment: After years of the platform acting as supreme ruler, the leverage was beginning to shift.
In the meeting, the stars sent a message to Twitter: Facebook, Instagram, and Snapchat all want our videos too; cut us a check if you want to keep us. "We made Vine a cultural phenomena," one of the Vine stars in attendance told BuzzFeed News. "We would like finally make a living off of the platform."
The meeting displayed something new that major social companies are now starting to reckon with: Very few people, relatively speaking, are capable of regularly creating compelling videos that others want to watch. And as social platforms look to saturate their feeds with video — live or otherwise — rather than just pictures and text, they're essentially competing for the same limited set of good videos. So those who create the quality stuff can demand payment.
In recent weeks, those payments have begun flowing. Twitter and Facebook both started handing out multimillion-dollar wads of cash to bring quality video content to their platforms. Twitter announced earlier this month that it would spend millions to stream 10 NFL games during the 2016 NFL season. And Facebook is offering six-figure checks to celebrities who agree to use its live-streaming product. Periscope's CEO, in an interview, wouldn't rule out paying content creators down the road either. When those Vine stars marched into Twitter's Market Street headquarters in San Francisco demanding financial compensation for their work, it wasn't an outlier. It was the new normal.
"In video we are seeing just how hard it is to make great content people watch on a recurring basis," Josh Elman, a partner at venture capital firm Greylock Partners who has invested in the live-streaming app Meerkat, told BuzzFeed News. "Given that, the platforms are starting to compete for those hundreds or thousands of creators who can do that, rather than hoping just anyone can become a star."
The Vine stars' demand in their meeting with Twitter was similar to the demands TV content companies make during negotiations. Viacom, for example, last week threatened to remove its content (including Comedy Central and MTV) from Dish Network if the satellite provider didn't fork up more cash for the rights to air it. If Dish didn't pay, Viacom's "blackout" would make Dish's competitors more attractive to the market. Dish agreed to fee increases, and Viacom remains on the network.
Multichannel video programming distributors — Comcast, Verizon, Dish Network, DirecTV, and more — transmit programming into people's living rooms. But they pay content producers and programmers to fill the airwaves so they don't have 1,000 channels of public access town hall meetings. Sound familiar? Just substitute Twitter for Dish and Vine stars for Viacom. The social platforms don't want to fill their feeds with hours of boring video either.
In the digital world, social platforms are the content conduits to the masses, and the power relationship between them and content creators is similar. Ultimately, people care about good content, not who distributes it.
(Of course, the two are not perfectly analogous: People pay to watch cable, but they don't pay to use social platforms. And cable has effectively no user-generated content, making it completely reliant on professional creators.)
Still, as the social companies shift to video, they're going to win and lose users based on the quality of the video they're showing. So they're willing to place bets on quality video content that can draw users in even if they're not guaranteed to directly make money off these deals. Take, for example, Twitter's recent agreement with the NFL to stream a package of games, which may cost Twitter more than it makes back in advertising.
"An engagement game, that's what Twitter is doing with the NFL," Peter Stabler, senior analyst at Wells Fargo Securities, told BuzzFeed News. "They're hoping to bring back hundreds of thousands of lapsed Twitter users."
Twitter, YouTube, Facebook, and Snapchat all want the same engaging, high-quality videos that do well on their platforms. "They're competing for attention, they're competing for engagement," Stabler said.
To get that engagement, it's looking more likely that these companies will be relying on video from a limited group of gifted social talent creators (see: DJ Khaled), or professional media companies. For Facebook, the reality may be arriving sooner than anticipated. Original sharing on the platform is down significantly, according to a report in The Information, meaning people are simply hitting the "share" button instead of posting original text, photos, and videos. Less content creation across the board makes professional content operations even more valuable to the social giant.
Facebook is already paying media companies and celebrities to post video via its Live product. The company is offering around $250,000 for 20 posts per month over a three-month period, according to one source with knowledge of the arrangement. (BuzzFeed is among the group of Facebook Live paid media partners.)
Kayvon Beykpour, CEO of the Twitter-owned live-streaming app Periscope, did not rule out the possibility of paying content creators in a recent interview with BuzzFeed News. "Maybe it's something that we experiment as Periscope specifically later on," he said, while adding: "It's really important for us to make sure we're building a product that people want to use without being monetarily incentivized."
"I think you're seeing a renaissance for content creators," Athan Stephanopoulos, president of digital media company NowThis, told BuzzFeed News. "Facebook's done a good job of connecting the lines to consumers and so has Snapchat, Twitter, Instagram, and Vine. Now you've got to fill those pipes with quality content."
At Facebook's F8 developer conference this year, CEO Mark Zuckerberg said that in a decade, "video will look like as big of a shift in the way we all share and communicate as mobile has been." And though Zuckerberg is setting up a product to spark more video creation from regular folks (Live), he's likewise ensuring it will be more attractive to professionals by paying them and expanding the cameras from phone cameras to professional-grade equipment.
This power shift may not mean media companies will find an answer to their digital revenue struggles, but it's still a moment where those posting quality content are beginning to get paid by social platforms, rather than ads, for their editorial work. And that's a big deal.
"These platforms know that without strong, independent, unique voices that they have nothing," Nicholas Megalis, one widely followed Vine creator, told BuzzFeed News. "The people are the most important part of any scheme. We can move mountains."
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