New 70/30 Twitch Partner Deal For Twitch Streamers
In late September 2022, Twitch President Dan Clancy announced a new Twitch Partner Deal. This announcement alters how revenue is split between the platform and its most successful streamers. It has been bad news from the decision on a revenue split of 50/50 instead of the favored 70/30 split. The 70/30 split is the industry norm for most streaming services.
The platform’s streamers were overwhelmingly upset with the new Twitch partner deal. A 50/50 split is the standard term Twitch already offers. In addition to 70/30 terms or “premium deals” for some of their more popular streamers. Premium deal streamers would retain the 70/30 split agreed upon but only for the first $100,000 earned cumulatively (not annually).
We’ll review what streamers are saying about this controversial new deal and how the terms will impact Twitch moving forward.
When streamers were informed of the new terms in late September many were upset about the new partnership.
According to The Verge, Clancy’s announcement about the deal came after several months of problems between Twitch and the platform’s creators. Twitch partners who belong to marginalized populations were inundated by “hate raids“. These raids that were met with a slow response from the company’s leadership.
Moreover, ads were interrupting streamers at inopportune times. And some of the platform’s top talent has been leaving in droves to strike lucrative deals with other streaming services.
When Clancy announced the new deal many streamers were quick to criticize it. Many streamers took to the Twitch Uservoice board to voice their displeasure with the new policy.
A streamer by the name of chrisxodash question whether Twitch cared at all about their streamers. And noted that many would begin jumping ship, opting to use streaming services like YouTube. Another creator who went by the name karterstrophic demanded that the platform pay them fairly. And highlighted that their revenue comes directly from their streams and content.
The entire thread is full of dissatisfied streamers, feeling cheated and used by a company who earns revenue on the content they produce.
Impact on Twitch
Twitch responded to the controversy with Chief Monetization Officer, Mike Minton stating that a long-term 70/30 arrangement was “not viable” and that Twitch was focusing on longevity and creating a framework to support streamers for years to come.
The response did not appear to satisfy streamers, which could have a detrimental impact on Twitch bottom line. With users threatening to leave for YouTube and other streaming services, Twitch might find that the new pay structure won’t cover the cost of continuing to lose popular creators.
Twitch will also need to consider how this new deal will affect their public perception, especially given the negative attention they received due to the aforementioned hate raids and the #TwitchDoBetter protest.
The new deal will no doubt have a disproportionate impact on streamers from marginalized communities including Black streamers, LGBTQ+ streamers, and streamers experiencing disability—groups who have already had difficult with Twitch promotion.
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So Twitch just made some rather significant changes to the revenue share, and the community is unhappy. If you’re unfamiliar with the recent discussions happening on Twitch, the current debate is that they’re looking to reduce the share of what twitch streamer gets, which is typically 70-30 with partnered streams, down to 50-50. So then twitch can have more revenue to run the website well. The decision has been made, and the fans are unhappy.
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At three o’clock in the morning, a letter was posted by the president of Twitch, Dan Clancy, on subscription revenue shares. They released the bad news when everybody was asleep, and the rest of the day’s news would cover you up. So what’s happening is it says we’re here for these streamers. What they mean as streamers who are making over 100,000 or receiving premium deals as they refer to the 70-30 split or adjusting the twitch deal so that they retain their 70-30 revenue share split for the first 100,000 earned through subscription revenue.
Revenue above 100,000 will be split at the standard 50-50 share split. This change will take effect on June 1st, 2023. Twitch cites that this will affect about 10 of the total twitch streamers. So if you’re likely reading this, it’s probably not going to affect you, but it seems very unfair for the people who’ve helped build this platform to be essentially taxed. So then twitch can have higher revenue but don’t worry about you. There’s a way to recover this, and that is by writing ads. Yes, it says right here that a recent bump in ad revenue shared to 55 as part of the ads, an incentive program is an excellent way for these large streamers to make up the cost, if not all, of the income that’s being cut from them.
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However, the thing is here that these streamers who are that high up often run these ads anyway. Because it’s an actual source of revenue, think about this. Twitch is saying, ” Okay, we’re talking about 20 of your money. We’re keeping that so you can run more ads on your channel to recover that cost. It will be a detriment to your channel regarding your viewership and how the experience is overall. This result is accurate because many of the twitch ads are not skippable, compared to YouTube ads you can skip.
I know many of these large ten-streamers do run ads on their channel. I mean, for example, here I like to watch his content Hassan abi. He’s doing quite fine for himself when it comes to money-wise. But think about this if anyone gets that much of the revenue cut overnight, that’s a big hit no matter who you are. I know for his content, he runs at the top of the hour ad breaks every hour because, well, he has tens of thousands of people watching him all the time. That’s a good amount of revenue.
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So they are saying that to recover the cost that he’s losing to run more ads, it’ll be like a 30-minute ad break. But don’t worry, there’s a new benefit that they’re cutting. The threshold of payment is half to 50 dollars. So if you earn at least 50 on Twitch, you’ll get paid instead of the hundred dollars you had to make previously.
Wow, so gracious, and twitch even mentions that they’ve been trying to generate more revenue through the chat. Prime subs community gifting hype trains an ad incentive program through channels, as you know.
They’ve seen an increase of 27 more streamers’ revenue per view, so you guys are still earning more money. Let’s also keep in mind that Twitch as a platform has been blowing up. When it comes to revenue, Twitch generated nearly 2.6 billion dollars in revenue in 2021.
They earned 275 million dollars in revenue by 2016 and then by 2021 earning 2.6 almost 2.7 billion dollars as a platform that’s insane growth. And yet Twitch cites the cost of operating the website as a reason for this cut for their streamers and justifies that delivering high definition, low latency, and always available content are factors considered.
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Live video in nearly every corner of the world is expensive; I do not doubt that. It sounds costly to do that using the published rates from Amazon Web Services. Interactive web services, essentially twitch video live video, cost a 100 CCU streamer who streams 200 hours a month, which is insane, more than a thousand dollars per month. So yeah, I can understand the cost, but the thing is there, guys, that you’re owned by Amazon, plenty of money being around. We see just on twitch alone this insane growth.
The executives of Twitch have profits. We don’t buy it. So how has Twitch seen this insane growth of up to 2.6 billion dollars in revenue? Then we have Amazon here as well, a company whose income is shy of 470 billion dollars, and you’re telling me that the 70-30 split is just a little too generous for the streamers on the platform. This claim is insane because you need your community for this website to run.
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Then they’re taxing the rich essentially to be able to run the website to the detriment of the website’s viewers. Also, because all these high-end streamers will start running more ads on their channel, it will be a detriment to the viewership experience.
And there’s like a minute-long ad I have to sit through. It’s very frustrating. I can only imagine seeing one out of six every 30 minutes on a large streamer’s live stream. It’s going to kill their channels. I suspect this is just like some pressure from executives at Amazon that you need to boost your profit margins in some capacity now. What is the relationship between Twitch and Amazon? Even though Amazon owns Twitch, it could be like a separate but equal kind of thing, but from our end, this doesn’t look good.
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Twitch is trying to squeeze this community for more money for what they don’t cite. Why do they mention that they’re going to try to improve services, but they need to cite something in particular? It takes an incredibly long for any requested services to come into Twitch in the first place. Essentially, they’re taking from us from the user end, and then we’re getting less in return. This was actually off the heels of a significant win for the platform. As well has been a severe gambling issue when it comes to gambling content on Twitch, and they’ve said that to date, they plan to prohibit sharing links and referral codes to sites that include slots, roulettes, and dice games.
So basically, making these gambling twitch streamers a little bit less profitable is good because you don’t want kids getting involved with gambling. That’s very important. But then you’re just going to be able to take this money from the people who’ve helped build your platform and then not give them anything back in return.
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No wonder, people have been jumping over YouTube because they see the direction twitch is going., And it’s just not fair because right now. On YouTube streaming, they do a 70-30 split for anybody. That’s right. You don’t need to be super special, like top 10 streamers, to earn a fair share of your revenue for the business now.
You won’t be seeing any twitch streamers jumping over to YouTube or any other platforms immediately. Because they need to finish their contracts before deciding where to stream next. But it just seems like Twitch is just shooting itself in the foot on this one. Maybe ninja was right to go with the decision of not being tied down to a single platform. But just to be streaming everywhere all at once at the same time might be just the way to go about doing it.
Because it’s one thing about, like I’d say about these social media platforms, it is tough to tie yourself down to a singular platform. Because if that platform does something like what Twitch is doing right now, it will be a massive detriment to you. If you’re a consistent content creator, you need to stretch out to multiple platforms to get people to view your content more and not rely on one service to run your business.
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The 50-50 sub split on Twitch is notoriously already pretty low for many streamers out there. You know, middle-tier streamers, even a lot of big streamers, a lot of twitch streamers on that 50-50 splits. It now twitches discussing, and this is in the discussion. This trend is something talked about a lot.
Because Facebook, if you guys only know all their streamers or whatever you call them over there on Facebook, 100 of that revenue goes to the streamers. YouTube is known for its 70-30 split, but only the top people on Twitch have been known and speculated. We only know who those streamers are if they want to come out, and those are all contractual.
So who knows if they can even speak about those? It’s been rumored that some top twitch streamers get that 70-30 split, but most people get the good old 50-50. Well, according to Cecilia, it’s Twitch discussing bringing everyone to an equal 50-50 playing field, as stated. Twitch is weighing potential changes to how it pays top talent. They said people familiar with the planning an effort that would boost its profits but would also risk alienating some of its biggest stars.
The proposal would also reduce the proportion of subscription fees doled out to the site’s most prominent performers, said those who asked not to be identified. Some changes to Twitch’s monetization structure could be implemented as soon as this summer.
The people said twitch staff is considering parrying back the revenue cut of channel subs granted to the top echelon of streamers. Its so-called partnerships program back to 50 percent from 70
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Another option is to create multiple tiers or set criteria for how to qualify for each one, two of the people said. In exchange, Twitch might offer to release partners from exclusivity restrictions, allowing them to stream on YouTube or Facebook.
So what I gather from this general gist is that we’re aiming for some top echelon streamers. Who might not be negotiating but discussing with Twitch what could be a drawback of their 70-30 sub split to 50-50. Still, they would be offered in return for that maybe some additional incentives for, you know, running ads. Which we don’t know the details of step by step on how that would work out. All of a sudden, your sub split goes down. Still, your ad revenue goes up. And this would even further incentivize someone like Twitch to pay you less on subs and make a bit more on ads.
You may know the full details of their origin, but it’s to help their bottom line. Still, beyond that, we see some things in this article that are pretty crazy of an exchange of maybe non-exclusive contracts. Maybe Twitch is allowing big streamers to stream on YouTube or Facebook now. How would this work if you could stream with other streamers who are banned on the twitch platform? That’s a bit of a stretch on my behalf, but how crazy would that be? As we have seen a backlash in recent YouTube events for CDL resurgence or rebirth events at first?
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It was speculated you had to stream on YouTube during the event, which may put your twitch partnership at risk. Everyone made it through that, you know, okay and straightforward. But what a wild time that would be if you’re going to allow your streamers to stream on all platforms.
What does that like?
We’re going to dive back into that at a later date. But the fact is this, there are plenty of people who probably will not be happy about this. As streamers were already not satisfied with the 50-50 splits. And now, with Twitch saying hey, even our top streamers are potentially going to get 50-50. That means there’s probably no shot for any streamers that are below the top streamers to get above a 50 50.
Only time will tell how the new pay arrangement will impact Twitch and its current roster of streamers. Given the overwhelmingly negative response from creators, Twitch may have to rethink the new deal. Or hold out and see if they can retain users despite it.
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