If YouTube is TV’s future, creators need a better deal
Opinion
Ad-funded content on platforms doesn’t work because there are too few platforms and the rents are too high. As media fragments and production businesses suffer, creators must diversify to survive.
231,503 subscribers. 18m views. Nearly $190,000 in revenue.
Sounds like success, right?
Wrong.
Carla Lalli Music — cookbook author, beloved internet personality and experienced media professional — did everything right on YouTube. She built an audience, produced high-quality content and played the game exactly as the platform intended. And yet, after three years, she pulled the plug.
Not because she wasn’t good at it. Not because she wasn’t growing. But because the economics never worked.
Despite millions of views, she was losing $10,000 a month just to keep the channel running. The platforms make billions, while creators — who actually produce the content — burn themselves out for peanuts.
This isn’t just a YouTube problem. Broadcast TV is facing a production crisis too.
‘Perfect storm’
For years, TV professionals were told digital was the future. But now? The UK’s TV production industry is imploding.
The Guardian recently published case studies from TV producers who have been forced into minimum-wage jobs. Once-thriving production companies are shutting down as streaming services slash budgets and ad revenues dry up.
Sound familiar?
It’s the same crisis hitting creators: a system where only the very top players survive, while everyone else gets chewed up and discarded.
TV producers are realising that platforms like Netflix don’t fund sustainable production pipelines — they squeeze suppliers for content, then cut them loose.
Last week, Elisabeth Murdoch warned that the “perfect storm” of economic challenges, escalating production costs and competition from international streaming giants have led to a talent exodus and funding shortages for domestic projects.
We now find ourselves in a video production industry where the barriers to entry are low because anyone can film themselves and distribute content on their phone.
That’s fine if media is a hobby. But professionally produced content needs a sustainable supply chain.
Not adding up
YouTube is making a bet on being “the new television” and execs are excited that more people in the US are watching it on TV sets than mobile devices.
Commentators like Evan Shapiro like to bash broadcasters (often rightly) for being slow to adapt. But to proclaim YouTube is the future, or even the present, of TV is just wrong.
Thinkbox’s recent presentation shows that the US story doesn’t apply here; the UK still has strong public-sector broadcasting and faces nowhere near the level of cord-cutting.
But Music’s story shows that industry evangelists should be careful what they wish for. Even savvy creators who operate with low costs are struggling.
Look at Music’s numbers:
- $3,500 per video in production costs
- $14,000 per month in expenses
- Best month of YouTube ad revenue: $7,544
- Worst month: $1,799
- Net loss: $10,000 per month
If you think $14,000 is too costly, compare this with what the estimated production costs are per day in England. Over a year, this would be about half of what the disgraced Gregg Wallace pocketed for presenting MasterChef.
So why is the ad revenue so low?
A glance at Music’s YouTube channel shows she regularly gets between 20,000 and 60,000 views per video; sometimes views are far north of six figures. Over three years, her channel garnered more than 18m views.
She says YouTube was charging her channel’s advertisers $29 per thousand views. But the revenue per thousand was around $10: “Where does the other $19 go? To YouTube, of course. That’s a 2:1 split in favour of the platform. Lord, give me strength.”
If you’re YouTube, you can argue that its platform is now so popular and ubiquitous that it is justified in charging such high rents.
As I’ve said many times over the years in this column, you can’t blame Google for any of this. Monopolies are a natural consequence of successful (or lucky) businesses that defeat rivals or protect themselves from competitors. Break them up or stop complaining.
This is why ad-funded content doesn’t work on platform media. Whether it’s YouTube or Netflix, there are too few platforms and so the rents are too high.
What creators should do next
The platforms won’t fix this.
Why would they? They benefit too much from keeping creators trapped.
But there are ways out.
1. Stop relying on platform monetisation: Treat YouTube ad revenue, TikTok bonuses and Instagram payouts as extra, not the foundation.
Platforms change the rules whenever they want — and they will. The only way to build a sustainable business is owning income streams you control.
2. Own your audience: If YouTube or Instagram shuts down your account tomorrow, you’d lose everything.
The solution? Email lists, paid newsletters and direct-to-fan platforms like Patreon and Substack.
If you can reach your audience without an algorithm deciding who sees what, you win.
3. Demand better revenue splits: On YouTube, creators receive 55% of the revenue from ads displayed on their videos, while YouTube retains the remaining 45%. Why not argue for 70/30 in favour of creators?
If creators collectively pushed for a fairer ad split, platforms would have to listen. Isn’t it time the few successful ones, like MrBeast, PewDiePie or Jake Paul, gave something back by leading a campaign for fairer pay for creators?
4. Diversify beyond one platform: No creator should rely on just one platform for income. The most successful creators make money from multiple sources: paid newsletters (Substack, Ghost); direct subscriptions (Patreon, Buy Me a Coffee); merch and product sales; licensing and syndication deals; events and live experiences.
If your entire business is tied to an algorithm, your business is always at risk.
5. Build creator collectives and networks: Individual creators have zero leverage against platforms. But groups of creators? That’s different.
Imagine a creator union or collective bargaining group that demanded fairer ad revenue splits, more transparency in algorithm changes and protection from sudden demonetisation cuts.
The more creators act like businesses and not just individuals, the more power they have.
What comes next?
TV production is shrinking. Streaming budgets are drying up.
And the creator economy that many think will replace it is not sustainable.
If independent creators and media professionals don’t adapt, the internet will become an AI-generated sludge factory where only the biggest corporate players survive.
So the real question is this: are creators going to keep playing a game they’re destined to lose? Or are they going to change the rules?
Because the history of our industry shows one thing: whoever controls distribution controls the money.
And right now? That’s not creators.
Omar Oakes was founding editor of The Media Leader and continues to write a column as a freelance journalist and communications consultant for advertising and media companies. He has reported on advertising and media for 10 years and was previously media and tech editor of Campaign. His column on The Media Leader was nominated for the BSME’s B2B Column of the Year in 2024.