Dive Brief:

• Twitch, which is owned by Amazon, unveiled its Ads Incentive Program (AIP), which aims to make ad revenue for creators more predictable. The service, which will be available to select creators, grants content creators a pre-set payout when they stream for a certain amount of hours while running advertisements.
• AIP is intended to streamline ad management and free up time for creators. Additionally, it could help creators better predict their monthly income while also freeing up time to focus on producing content.
• As streaming platforms like Twitch become increasingly popular, especially among younger people, making it as easy as possible for content creators to produce content is vital to driving viewership. The move also allows Twitch to optimize its own ad revenue.

Dive Insight:

Twitch, a streaming platform that mainly hosts those playing video and tabletop games, is piloting a program to help streamline advertisements on the platform while also offering select streamers a flat monthly income based on the amount of advertisements run.

AIP builds off the preexisting Ads Manager, which is an advertisement scheduling tool. Other advertisement tools that can be used by streamers on the site include picture-by-picture, which still allows viewers to watch the stream while an advertisement is playing, and stream-display-ads, which are 10 second advertisements that play while viewers are still able to hear and see creators.

Rates paid out by the AIP will vary based on audience size, geography, hours broadcast and other criteria. The first round of the program is being offered to creators of various sizes and geographic locations, with more creators being invited to join as the program grows. Additionally, streamers will be able to control when advertisements run, but not what advertisements are shown.

Twitch's move toward a guaranteed advertisement income encourages creators to produce a steady stream of content that routinely incorporates advertisements. Unlike other streaming platforms such as YouTube, many channels on Twitch come with a monthly subscription fee starting at $4.99 per month, making up the bulk of streamer’s income. Subscriptions are split 50/50 between the creator and Twitch. Viewers must resubscribe to their selected channels every month. Amazon Prime subscribers get one free subscription a month.

Twitch, which relies completely on user-generated content, is giving users an incentive to run advertisements, which are traditionally an unreliable source of income for content creators. By guaranteeing a base level of advertisement income for creators, Twitch is encouraging users to create a certain amount of content per month, benefiting the platform. It also removes a burden from creators, encouraging them to utilize the advertising options on the site.