Why Twitch Is Reportedly Considering Pay Cuts? (Reason)

Twitch has grown massively over the years. The live streaming platform has become the main source of income for many live streamers. But according to the latest news, Twitch is reportedly considering pay cuts. This has surely disappointed a major of the streamers but Twitch did have a particular reason for taking such a decision.

Amazon definitely owns the most popular live streaming platform currently. It is absolutely free for the users but unlike other free platforms like YouTube, it doesn’t make good revenue. So, it has forced the owners to look in a different direction because they need to earn profits to keep it running.

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What Will be The Pay Cut?

Bloomberg reported that Twitch is thinking about introducing new ideas for bringing out earnings. It is said that the platform is planning on cutting the pay of the creators streaming on the platform for making their money.

Twitch Is Reportedly Considering Pay Cuts
Twitch Is Reportedly Considering Pay Cuts

One of the proposals is to reduce the payment of the top-tier streamers. Instead of getting 70% of whatever they make from their subscribers, the idea proposed to suggest that the streamer must be getting a 50% subscription from now onwards. That is a 20% reduction from the original earnings.

The other idea is to come up with incentives. This can be done by running ads. However, the streamers have to qualify before getting that facility as this will maintain an exclusivity.

On the other hand, Zack Bussey reported this revenue percentage proposal may be applicable to all the streamers of the platform and not just the top streamers. It is also needed to be noted that Twitch is looking for ways in which creators can run more ads and, in that way, they can earn profits.

So, the report sums up:

  • More ads will lead to more viewers and revenue
  • Streamers will get less revenue

What Will These Changes Be Like For The Streamers?

In spite of introducing some pro-streamer moves, these changes may be eliminating any sort of exclusivity. Moreover, big cuts may be implemented. As a matter of fact, gamers on Twitch have become millionaires over the years. But only a fraction of these streamers earns so much. There have been several leaked earnings reports that suggest less than .01% of streamers fail to make even the minimum wage as given on the platform.

Now, the cuts will be spread across the board and it will even reduce the payment much more. This can affect the most on the top creators who earn thousands and hundreds of dollars from the platform. Besides, if this ends up being a huge loss for the streamers, then the streamers can leave YouTube or Facebook when the earnings are stable.  

If the proposal is approved and results in YouTube-like money, then many streamers can shift to YouTube. 

When Will The Changes Be Implemented?

It is said that whatever the decision is, it will be implemented by summer. Many streamers are coming out against the decision and one of the top Twitchers, HasanAbi with 2 million followers tweeted that the company is “moving away from [content creators] to fix their profits, and thinks they can do so “because they think there is no competitor in the live-streaming space. a mixer is dead, FB is a black hole for relevance, and it is too big to care abt live streaming and too slow to change.”

He even highlighted the details of his partner contract and stated, “I knew this was coming & wanted to lock in 1 min of ads per hour. this ad density is the lowest out of the top streamers.” 

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Bloomberg did confirm that none of the given changes are finalized as of now and given the reaction, there might be further changes. So, before anything is confirmed, it’s safe not to think about anything.

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