Friday, July 28, 2017

New Sources of Revenue for Online Entertainers

Online entertainers are breaking into new sources of revenue.  Previously, majority of the revenues came from advertising on YouTube.  Revenue has since diversified into merchandise, live events, subscription video on-demand, content royalties, etc.  For example, provider of witty video game commentator Rooster Teeth hosts multiple day gaming conventions,  web comic Penny Arcade has spun its original business into new series, a merchandise line and its own gaming convention and Penny Arcade Expo. Podcast network Maximum Fun hosts its convention MaxFunCon at least twice a year on the East and West coasts.   

These online content creators are tapping into the long tail and developing a large following.  Once sequestered to YouTube and other web spaces, online entertainers like Rooster Teeth are breaking into new sources of revenue, and events, which can draw thousands of loyal fans, are becoming a key component of their growing franchises. Today, as Rooster Teeth continues to branch out, advertising makes up 31% of the company’s revenue. Less than half of that comes from YouTube ads; the rest comes from sponsorship relationships.  This is a great example of companies / entrepreneurs using digital media to promote themselves.  Once they reach a certain number of targeted followers, their brand will take off and there are various ways to monetize.

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