Twitch’s “Ad Revenue Upgrade” – Some Thoughts

A few days ago, Twitch announced their so-called “Ad Revenue Upgrade” – a program that is supposed to help out streamers by moving away from their previous “CPM” model and by granting them a 55% cut of the revenue earned from ads for each ad that runs on their stream… This change represents, according to Twitch, a 50-150% ad pay rate increase for most streamers. Sounds great, right? Well,… no. The issue is here that you need to activate the automatic/scheduled “mid-roll ads” to get rid of pre-roll ads completely – but pre-roll ads are the lesser evil for sure even if they’re annoying and even if they harm discoverability. Hence, I wanted to dive into that and explain why exactly I think that this whole idea is not the right direction to go for.

First up, don’t get me wrong, 50-150% increased ad pay rate and a 55% cut of the ad revenue sounds amazing. I’m not complaining about that at all. Rather, I’m bothered by how it’s tied to mid-roll ads or just “mid-rolls” and how these automatic/scheduled ads are just not suited for content creation. Typically, unless you got Twitch Turbo or a subscription to a specific channel, you’ll see a short ad when you enter a channel unless, of course, the streamer you’re watching has played an ad. These so-called pre-roll ads or just “pre-rolls” are one of many reasons why there aren’t as many people browsing for new streamers to watch. They’re annoying and frankly, nobody likes them… but they’re the lesser evil here given that mid-rolls essentially just play in the middle of the stream and they come across as disruptive. Twitch technically notifies you when they happen but it’s hard to plan it out properly, depending on what content you go for.

When I watch a streamer that uses mid-rolls, I get annoyed at it. Frankly, it feels disruptive and it hurts the experience greatly because an ad just plays in the middle of a sentence and you can’t see or hear the stream during that time because the ad is now playing. This ad can be anywhere between 30 seconds and 3 minutes long, in theory, and if you as a streamer are in the middle of saying something important or if you’re in the middle of a boss fight, people will not see it unless they’re subscribed to your channel or they have Twitch Turbo. The idea behind this program is that if you run 3 minutes’ worth of ads on your channel per hour, you will see an increase in ad revenue. Previously, you’d have to play a lot of ads or be very successful as a streamer to see much revenue. I know people that have relatively high numbers, often going up into the hundreds, who only earned about seven bucks from ads in a specific period. Ads are calculated based on every thousand views your channel gets, so it varies greatly and people don’t really earn too much from it in general. Seeing an increase is nice but it comes at the cost of a disruption for three minutes every hour that you stream. Is that worth it?

Candidly, I don’t think that mid-rolls are a good fit for live content anyhow. It just doesn’t work. I believe that you can make it work if you don’t give a shit about people’s experience or if you’re a huge content creator with thousands of viewers who can afford to play that many ads in an hour without turning away viewers… most streamers on Twitch, however, aren’t that big and if those many ads were to play, they’d lose viewers unless their viewers are subscribed to the channel.

Either way, pre-rolls clearly are the lesser evil and I believe that Twitch could do a much better job with banner ads that appear on the stream at the side for a brief moment at specific intervals as that would just seem less intrusive. Similarly, streamers can play ads manually to disable pre-roll ads for a specific amount of time but the maximum amount of time you can disable pre-rolls for is just half an hour which is nothing. If you wanted a pre-roll-free experience for your viewers, you’d have to play three minutes’ worth of ads every half hour which is worse than what Twitch is suggesting here. What I do over on my Twitch channel is that I run one ad at the beginning of the stream when nobody is around while I’m on my “Starting Soon” screen. Then, people won’t get pre-rolls for a while. Afterwards, I may or may not play an ad during breaks since people don’t miss out on anything in that time… but honestly, most of the time it’s not worth it.

Pre-rolls are annoying but after you watched one ad for this one stream, you don’t have to watch any other ads on Twitch. Meanwhile, with mid-rolls, you’ll get more ads overall as a viewer. It just seems worse. Often, I find myself sticking out the pre-roll to find a new channel and get to know people. At the same time, though, I also find myself clicking off a stream when they run automatic ads that just feel disruptive. At times, ads are incredibly loud, too, compared to the stream’s volume, which is something that streamers don’t have a lot of control over. There are also times when ads just don’t fit the general vibe of the stream – with condom ads for example at times playing on a family-friendly channel.

It’s a shame that Twitch can’t seem to find a better way of doing things. It’s even worse that they are selling the mid-rolls as that much more profitable when in reality ad revenue sucks. I mean, you won’t see big profits as a small-time creator but I’m sure that many small creators will read this announcement and think they’re gonna make big bucks off of it, resulting in a lot of people essentially playing ads automatically, which sucks for the experience. This borderline feels like Twitch is trying to push people into subscribing to either Twitch Turbo or all sorts of channels. It’s strange. But that’s just my two cents on it.

This post was first published on Indiecator by Dan Indiecator aka MagiWasTaken. If you like what you see here and want to see more, you can check me out on Twitch and YouTube as well. If you find this post on a website other than Indiecator.org, please write an e-mail to me. Thank you!