Not to be outdone by the stiff competition over at YouTube HQ, Twitch has decided to get in on the fun and launch their own version of the adpocalypse, but with their own special twist. Before we get into the “whys” and “how could yous” of your standard internet op-ed, let’s try and examine what might actually come of this move.
Twitch prime suddenly not so prime
So by now you should have heard that Twitch (or Amazon) has decided that one of the key benefits of having a Twitch prime subscription, ad free viewing of streams, will be going away as of October the 15th. Current subscribers will get to run out their year subscription with the current ad-free viewing, and anyone who sets up a subscription prior to September 14th will be allowed a full year of ad-free prime, however once the time comes to re-up your subscription, you’ll be pushed outside into the cold cold world of preroll ads with the rest of the twitch user base. There is a way to avoid this however, and that is the resurfaced emphasis on Twitch Turbo, the product that Twitch themselves had a hand in killing with the introduction of Prime.
Therein, I believe, lies the core issue: a fundamental lack of differentiation between product offerings. On the one hand you had Turbo, which for $8.99 a month gets you ad free viewing, an expanded default emote set, expanded username color options, some streamer specific benefits (longer VoD storage and “priority support access”), and a neat battery shaped chat badge. On the other hand you had Prime, which for $119 a year gets you ad free viewing, Twitch Prime loot, free games monthly, AND a free sub to a channel of your choice each month. If those two product offerings sound extremely imbalanced, it’s because they are. In general the default emote set and chat name colors are perfectly fine for the vast majority of users AND who can turn down free games?
So, in what I can only assume is a hamfisted attempt to make Turbo more appealing, they removed the ad-free viewing feature from Prime, and thus you must now subscribe to both tiers (bringing your monthly payout to twitch up to $21 a month) in order to get what used to be included with Prime.
Now it’s understandable how some poor team over at Twitch was probably tasked with “fixing our Turbo subscription problem” and thought that this was the best way to go about it. And it’s equally understandable how it got pitched up the chain and approved. After all, who in the business world would turn down a way to potentially increase their month revenue by 75% at best, and at worst, increase their ad revenue by a significant portion? But Twitch’s potential win here goes even beyond this. As it stands now, the best (and only) way to avoid potentially seeing ads without a Turbo subscription is to subscribe to each channel individually. Only then can you avoid seeing ads for only that one channel, only if the channel has deselected the opt out for subs. If that sounds like a lot of “only”‘s to you, that’s because it is. So to that end, Twitch still wins on the number of potential subs that will come of this.
It doesn’t just stop there however. Twitch Partners are likely to see an increase to their sub counts as well. With the potential for ads stopping non-subbed users from seeing their favorite content on Twitch, subbing and getting the dozen or so emotes that come with their sub now seems like an extremely easy choice. And if they hold out and refuse to sub, Partners still make a portion of revenue for the ads that are shown on their stream. So in the end, partners still win and have a semblance of deniability about the whole thing. After all, this was a decision made by Twitch, and potentially not by the hands of partners.
Not Quite A Zero Sum Game
Do these benefits cascade down to the Affiliate level? Well there, I’m afraid, things may start to look a little bit bleaker. Ever since Twitch rolled out the Affiliate program, reaching Affiliate has been an extremely desirable, but still easily attainable, goal for most streamers starting out. That said, there is an extremely wide gap between Affiliate and Partner level requirements, and until a stream crosses that gap, this move could be a potential channel killer. Fair warning, we are entering the realm of speculation here now, so take what I write with a grain of salt, things could always turn out differently.
When you’re a successful Partnered streamer, more often than not, your streams are quite healthy, both in terms of concurrent viewer counts and in terms of active chatters; Potentially missing out on a couple people here or there wouldn’t represent a major miss. Hell, I doubt Ninja or Summit even notice when their viewer counts drop by 3-5 people. On the other end of the spectrum however, you have Affiliates who are making do with between 7 and 12 concurrent viewers, and a drop of 3-5 would be devastating at those levels. The struggle to grow and retain viewers at this level, regardless of future endeavors, is going to generally be in the back of every growing streamer’s mind (at least any streamer who cares about things like view counts etc). To these users, the sheer concept of a 30 second ad showing before their content potentially driving away users from viewing their channel should be a horrifying thought, and rightfully so. This invalidates things like stream quality, lighting, backdrops, overlays, sound equipment, and keeping things energetic and interactive for your viewers. If the viewer never even makes it into your channel, how can you ever even have a chance to convince them to stay? While it may seem like a 15-30 second ad at the start of each stream is a small price to pay for great content, the well documented and continuous struggle of adblock software providers and platform developers goes to show just how much of a nuisance a significant portion of viewers see the ads to be. And the really bad news for Affiliates? Twitch appears to be winning this fight, at least for now.
Well what about channel specific subs preventing ads from being shown? Well, with only a single free sub each month, and significantly fewer tangible benefits to users subbing to Affiliate channels (a single tier 1 emote vs however many Bahroo has at this point), it is unlikely that users who aren’t already subbed will become a new sub to compensate for the ads, thus thrusting the annoyance of preroll ads on to even your loyal viewers.
Life In The Wasteland
So where does that leave things? Well honestly, it’s difficult to say. There are a number of ways this whole situation can go, and I don’t claim to have all the pieces to say for sure which way it will go. That said however, it is not difficult to imagine a worst case scenario, one where the smallest of Affiliates slowly die off due to disinterest and a lack of new eyes, and where those on the rise begin to stagnate as only their loyal viewers return. On the other hand, Partners are likely to benefit immensely as the increased ad revenue and subscriptions help them out, and, of course, Twitch itself benefits immensely. But of course, there is one major hole to poke in this theory, and that is the number of preroll ads shown prior to streams loading.
In my own research, (and granted I am a Prime subscriber, so I had to do things from an old account), I noticed that the only time I would trigger an ad would be on the first stream I watched during a viewing session over an unknown period of time. That is to say, when I first logged on, the first stream I clicked on displayed a video ad, and any stream I clicked on thereafter did not. I believe it is this frequency that will ultimately dictate the impact of this change on channels. If users are only eligible for new preroll ads every hour, then the ultimate overall impact of ads on new channel discovery is potentially significantly reduced. On the other side of this however, Twitch could always increase the frequency or conditions under which they show said ads, potentially to encourage people to subscribe to Turbo or to the channels they wish to view. So as speculative as my worst case scenario is, it could still go in any direction.