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The Rising Tide of Ads on Twitch



For a while now, we've been complaining and eventually getting used to the growing amount of advertising that is being added on top of the live-streaming service of Twitch. It was inevitable that ads would become synonymous with live streaming and of course, there was a very small minority of viewers who would make it known quite loudly about the degradation of the viewership experience on Twitch.

Throughout social media sites like Reddit, Twitter, and even TikTok many would proclaim that they were looking for ways in order to bypass the ads which Twitch themselves were getting into a cold war with many ad blocker companies. We saw the introduction of the purple war of death for anyone that watching a live stream away from the Twitch website, in which the viewer would see a full-page purple screen stating that they would not be receiving the best Twitch experience.

There were so many threads on the r/Twitch subreddit that eventually the admins of the subreddit had to make a mega thread to help collate the threads into one place. Over the following months, tensions were high as the ad-blocking companies and Twitch went back and forth to keep viewers to stay on watching their favorite streamers on the Twitch site and not using ad blocker software.

All of this leads into the present in which the general consciousness of Twitch is focusing so much of its research and development on advertising tech. Pushing affiliate and partner streamers to run more ads during their live stream in order to receive a higher cut of the ad revenue offered. Now, there are experiments coming down the pipeline in which there would be on-stream overlays, streamer live reads, and more sponsorship opportunities for monetized creators. Twitch is quickly trying to insert itself into being the first party live streamers would rely on for earning money.

For the viewers, there isn't much of an incentive to continue to watch a live stream on Twitch. Yes, you can purchase Twitch Turbo (current pricing is $11.99 per month) in order to view all of Twitch ad-free. That is unless a streamer runs ads for their subscribers. Speaking of subscribers, 50% of that subscriber revenue is directed straight to Twitch's coffers and the live streamer receives less than 50% due to taxes, fees, and anything else that would need to be removed before the streamer gets their cut. The sub-split has been a constant condition between streamers and Twitch for years. Twitch doubled down when a blog post released by then President of Twitch Dan Clancy stated that Twitch would not be looking to change the sub split and went further to state that any creator that is currently on a 70/30 split would be then placed into a 50/50 split for any income over $100k. Twitch gave themselves an out in which a year after the institution of this change, those 70/30 splits would be no more.

As many creators and live streamers continue to search for alternatives to Twitch's very archaic thinking in regard to advertising and sub-splits, other services and platforms are trying to entice them to come over and stream on their platforms. YouTube has been the best take with a sub split at a 70/30 split right from the start for monetized creators. Kick who is a new upstart is offering an unheard-of 95/5 sub split and the fact that they have no on-stream advertising currently at the time of this writing.

Creators and live streamers have never had as many choices in order to create an income. The problem is that Twitch is focusing too much on driving as much advertising in live streams as they are beholden to keep shareholders happy and in turn, Amazon as well. Is this the beginning of the end of Twitch and will many more viewers and creators look to other sources to recoup more of their money spent and earned?

In this post I will take a deeper dive into the rising tide of ads on Twitch, the impact it's having on both viewers and streamers, the ongoing battle with ad-blocking services, Twitch's outdated revenue-sharing model, and why streamers are now looking elsewhere. I'll also take a look at some of the alternative platforms that are emerging and trying to win over dissatisfied Twitch creators.

The Purple Screen of Death

For viewers, one of the most irritating parts of the increasing ads on Twitch was dealing with what became known as the "Purple Screen of Death". This referred to when viewers would try to watch a Twitch stream from outside the Twitch website/app, such as embedded in a gaming news article or shared on social media.

Instead of being able to view the stream, they would be greeted by a full-page purple screen with a message that they needed to visit the Twitch site/app to get the "full experience". The implication is that embedded views were considered second-class experiences. This frustrated many casual viewers who just wanted to quickly check out a recommended stream without having to switch applications/windows.

The purple screen effectively forced all viewers back onto Twitch's own properties where they had more control over inserting ads. But it also damaged the potential for stream discovery and sharing content beyond Twitch's walled garden. It's easy to see why this heavy-handed approach didn't sit well with a lot of people.

The Arms Race with Ad Blockers

At the same time as increasing pre-roll ads, Twitch also ramped up its efforts to curb the use of ad-blocking extensions and programs. This triggered a bit of a technological arms race as blockers tried to stay one step ahead of Twitch's attempts to detect and prevent their use.

One method blockers employed was cloaking their code to look innocuous until activated. But Twitch worked on identification techniques to see through these disguises. Some blockers even started using misleading or deceptive names to trick users and slip past filters.

The battle played out both in direct software conflicts and also started creating heated debates online. Communities like r/Twitch on Reddit were filled with complaints and troubleshooting requests as the situation escalated. Twitch took a hard stance, arguing people should accept reasonable ads if they wanted to access free content. Blockers claimed users had a right to control their own experiences.

In the end, Twitch gained the upper hand by making it difficult to access streams without ads. But their more antagonistic approach also left some viewers with a negative perception of the platform. It highlighted the different priorities of seeing streams as a business versus a community-focused service.

Twitch's Ad Push Downstream

The increasing emphasis on monetization led Twitch to start heavily pushing affiliate and partner streamers to run more mid-roll ads during their broadcasts. Streamers were told higher ad revenue shares were available if they agreed to regular ad breaks of 2-5 minutes per hour.

Naturally, many streamers complied since partner status requires meeting certain income thresholds each month. But it also made the viewer experience more interrupted and less immersive. It paradoxically risked driving away fans if streams felt too commercialized.

Twitch has also signaled future plans like integrated sponsor announcements and promotional overlays streamers can run. The goal is to make livestreaming feel like traditional media with constant advertising pitches. While brands and sponsors see value, it further damages perceptions of Twitch as a community space first.

Streamers themselves are left in a difficult position, feeling obligated to run more ads despite potential backlash. The situation highlights the power imbalance that exists as Twitch controls the platform every streamer relies on for their livelihoods. Studios and agencies also get involved nowadays to help book ads, taking a cut of revenue as well.

Overall, Twitch's ad inception upon on-stream content risks alienating the very viewers and streamers that made the platform successful in the first place. It remains to be seen if a constant deluge of marketing can be sustained long-term in an increasingly crowded live-streaming market.

Twitch's Outdated Revenue Sharing

Despite its best efforts to build advertising into every facet of the platform, Twitch loses streamers and viewers due to its long-criticized 50/50 subscription revenue split. For years, partners were stuck with this lopsided arrangement where half their hard-earned sub-income went straight to Twitch.

In 2018, the company made it temporarily worse by lowering top earners to only 40%. Then COO Dan Clancy cemented the 50/50 as permanent going forward in a controversial blog. Even YouTube Gaming and Facebook Gaming, seen as less desirable streaming alternatives back then, had fairer 70/30 arrangements.

The writing was on the wall that subs would be a major income pillar for livestreaming going forward. Yet Twitch stubbornly refused to adjust despite much criticism. It underscored the perception that Twitch prioritized its own profit margins above supporting streamer success long term. Partners were left disappointed and looking for ways to offset Twitch's sizeable chunk through brand sponsorships and donations.

More than half a decade later, the 50/50 split still stands as one of the main grievances pushing streamers away. Simply matching competitors like YouTube would be a good first step towards renewing faith in the platform. Otherwise, more established names will happily take their audiences elsewhere for a fairer contract. Twitch's resistance does not appear financially justified nor conducive to fostering a healthy streaming ecosystem.

Twitch Attempts to Placate Critics with "Partner Plus"

In a seeming acknowledgment of growing unrest, Twitch announced a new "Partner Plus" program in June 2023 aimed at providing more benefits and flexibility to their top creators. Under the program, Partners meeting certain criteria around hours streamed and average concurrent viewers can apply for additional monetization features and tools.

Some notable aspects of Partner Plus include increasing the subscriber revenue split to 60/40, allowing streamers to run ads no more than once per hour, and providing dedicated support resources. The ability to upload up to 12 hours of VOD content per stream is also intended to appease those wanting to better utilize the long-form archive aspects of YouTube and other platforms.

On the surface, Partner Plus appears a positive step towards addressing long-standing grievances around strict ad policies and the 50/50 revenue share model norm on Twitch. Giving elite streamers a bigger cut of subs as well as more control over commercial placements makes the service comparatively more attractive to build a sustainable business.

However, some questioned if Partner Plus merely papered over underlying issues rather than enacting sweeping reforms. The program is invite-only and capped at 500 streamers initially. That leaves the vast majority of Partners still stuck on 50/50 revenue splits with limited customization abilities. Twitch also avoided completely overhauling its existing monetization structures in one fell swoop.

Only time will tell if Partner Plus meaningfully placates top talent looking for greener pastures elsewhere or if it signals more sweeping changes are still needed across the board. For now, Twitch seems content-stabilizing defections of top earners while strategically ceding little real power away from their centralized control of the platform. Whether a piecemeal or comprehensive solution ultimately proves most effective for their long-term viability as the livestreaming leader remains up for debate.

Emerging Alternatives Beckon Dissatisfied Creators

As Twitch doubled down on squeezing more money from its current business model, new platforms smelled opportunity. Both YouTube Gaming and Facebook Gaming swiftly poached high-profile Twitch Partners by offering incentives like higher revenue shares and easier onboarding.

More recently, upstart services like Trovo and Caffeine have also thrown their hats in the ring. But the fastest growing competitor is likely YouTube which has quietly built an excellent livestreaming infrastructure over the years. Their generous 70/30 maker split gives streamers way more take-home pay compared to Twitch's 50%.

The value of YouTube's massive user base numbering in the billions also cannot be overstated. Getting discovered is infinitely easier than on Twitch. Plus YouTube caters its platform towards longer form VOD content which aligns better with how many streamers actually operate today compared to the fleeting chat-focused culture of Twitch.

Among the freshest options gaining traction is Kick which proudly boasts a stunning 95/5 revenue split for streamers. The blank slate service also smartly chooses not to run any ads during streams for the time being. Their clarity on balanced business policies has caught the eye of numerous Twitch Partners tired of the ongoing drama at the purple site.

While none have perfectly replicated Twitch's real-time audience community just yet, alternatives are steadily refining their social features. For growing one's platform in more sustainable ways, they provide viable work destinations. More streamers finding a home elsewhere could light a fire under Twitch to finally implement real changes audiences have requested for years.

The Beginning of the End for Twitch?

With battle-hardened rivals gunning for their content creators and disenchanted users, Twitch may have succeeded in architecting its own disruption. By pursuing profit growth through advertising and outsourced agencies above all else, they risk losing touch with what made their service special in the first place - authentic human connections among peers with shared interests.

Streamers have never had so many viable places to call home simultaneously diminishes Twitch’s monopolistic leverage as well. They can no longer take supporters for granted nor stubbornly dismiss complaints. The writing may be on the wall that painful self-reflection and reforms are needed if Twitch wishes to retain its leadership role going forward as the live-streaming market matures.

Constantly expanding advertising injection will never replace the goodwill eroded from disappointing the same community that built the company up. Whether Twitch changes course or watches its influence gradually be supplanted by competitors respecting creator and viewer needs more remains to be seen. But changes are surely coming as even the largest incumbents rise and fall in step with meeting market demands.

In summary, the unending tide of ads flooding Twitch risks truly overstaying their welcome. The service's 50/50 revenue-sharing model looks increasingly misaligned with catering to talent upon which their livelihood depends. Viewers also carry options elsewhere without the same commercial interruptions. With authentic connections at stake and emerging choices abounding, Twitch will need to address these issues promptly if it desires to remain the preeminent live-streaming hub. But will the reins of their colossal creation prove too tight for changes many see as readily needed for its long-term prosperity? Only time will tell.


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