YouTube has invested millions of dollars into creating premium, original channels and will be refocusing their efforts by cutting funding to the majority of channels they helped fund in the first place.
This news may come as a bit of a surprise, and new contracts will be sent out this week, but only 30 to 40 percent are expected to receive one.
Channels that won’t be receiving any more funding won’t necessarily disappear. With the changes, they simply won’t receive money to work on creating new videos. Depending on how well they’re doing, they’ll still generate money through ad revenue.
Part of the reason YouTube is doing this is pretty straightforward: For one, there are some premium channels that just aren’t panning out. Also, there are channels that are generating sufficient revenue and therefore don’t need any more funding.
YouTube’s Director of Content Strategy, Jamie Byrne, said that watch time and cost efficiency are the two biggest factors in deciding who will continue to get funding and who will not receive a new contract.
This is far from the end of original, premium content. Thousands of video creators outside of this program continue to roll out high quality, consistent content that millions engage with every single day. YouTube is simply looking to reassess where they are investing money in original channels and figure out how they can better allocate it, just as any successful business would do.