Over 800 million unique users visit YouTube each month. Finding a way to monetize these massive audiences, however, can be challenging for both content creators and brands looking to develop sponsored content with YouTube's most prominent digital influencers. In the wake of YouTube stars' escalating popularity and increased social reach, Multi-Channel Networks (MCNs) have emerged to help content creators produce high-quality videos and manage their advertising revenue streams. On the brand side, MCNs provide a vital link between YouTuber and companies by facilitating lucrative influencer marketing partnerships and giving brands access to a digital influencer's large social following...
MCNs are organizations that partner with YouTube channels (and possibly other video sharing platforms) to offer services to contracted content creators. These services may include digital rights management, monetization, target audience development, cross-promoting, funding, product development, brand sponsorship collaborations, and additional influencer marketing opportunities.
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YouTube MCNs offer their services with the agreement to receive a negotiated percentage of revenues generated from the ads and sponsorships of the YouTube influencer's channel(s). By creating content management system (CMS) profiles on video platforms and adding their contracted users to the CMS, multi-channel networks aim to minimize the difficulty involved with advertising, producing/editing videos, and building an audience.
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How YouTube MCNs Help YouTubers
Unlike YouTube’s original Partner Program, which compensates content creators through grants or advertising and leaves the process of making videos to the YouTuber, an MCN can provide digital influencers with a variety of possible benefits, including:
YouTube content creators can gain access to valuable production and editing facilities that may boost the quality of their videos considerably.
Some MCNs provide content creators with celebrity collaborations and big media projects to possibly expand their exposure.
Many MCNs may promote network channels through collaborations with other related YouTube channels to potentially reach a larger audience.
Monetization support may be available through a dedicated advertising sales team.
MCNs may offer advice on ways to make videos more accessible to audiences and how to best optimize a YouTuber's video content.
MCNs may offer advice on ways to make videos more accessible to audiences and how to best optimize a YouTuber's video content.
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The Drawbacks Of Working With YouTube MCNs
Working with a YouTube MCN may help YouTubers reach new audiences and find creative ways to monetize their channels, but some content creators find MCN contracts onerous and restricting. Maker Studios, for example, allegedly pressured popular YouTuber Ray William Johnson to sign a contract that would give 40% of his channel revenue and 50% of the intellectual property rights to the company. YouTube MCN Machinima is another multi-channel network that has come under fire for using contractual fine print to secure everlasting rights to YouTube influencers’ content.
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In lieu of these missteps, content creators should always be aware of exactly what is in the contract. Though beneficial for some, MCNs are still businesses that work for profit, and it is important for channels and YouTubers to protect their own best interests.
Binding contracts aside, another potential drawback arises when MCNs manage too many YouTubers at once. In this case, smaller content creators and channels feel dissatisfied and let down. When MCNs overextend themselves with talent, they are often not able to deliver on promises, which can result in a backlash among managed channels, negative sentiment towards the YouTube MCN, broken contracts, and relationships.
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“We hear from creators all the time about how much they hate MCNs. They thought the MCNs were going to make them money, but it turns out they didn’t," an agency exec was quoted as saying in a recent Digiday article by Sahil Patel. "That’s what happens when you have 50,000 creators”
List Of Biggest YouTube MCNs
As Lori Kozlowski reports in Forbes, YouTube MCNs of all sizes are flooding into Los Angeles hotspots like Silicon Beach—often called the “The Hub of Influencer Marketing”—where many content creators and top social media influencers live and work. Increasingly, MCNs now cater to niche audiences like gaming (Machinima), dancing (DanceOn), and food (Tastemade) to better serve audiences looking for a specific type of content. This type of MCN specialization also helps YouTubers better target engaged, interested audiences.
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According to SocialBlade, a statistics and consulting firm, Fullscreen, Vevo, Machinima, StyleHaul all make the list of the top ten largest MCNs. Others notable YouTube MCNs include:
Notable YouTube MCN Acquisitions
As the reach of YouTube MCNs continues to expand, major entertainment companies have begun buying MCNs to gain access to their large, engaged audiences. Some of the largest MCN acquisitions include:
Maker Studios acquired by Disney in March 2014 for $500 million (plus an additional $450 million in performance-based incentives)
StyleHaul acquired by RTL Group in November 2014 for $107 million
Collective Digital Studio acquired by ProSieben in July 2015 for $83 million
AwesomenessTV acquired by DreamWorks Animation in May 2013 for $33 million
Hearst pays $81 million to DreamWorks for 25% share in AwesomenessTV in December 2014
BroadbandTV acquired by RTL Group in June 2013 for $36 million
Fullscreen acquired by Otter Media in September 2014 for a majority stake in the company
Geek & Sundry acquired by Legendary Entertainment for an undisclosed amount
Conclusion
YouTube MCNs can be beneficial for all parties - YouTubers, the MCN, and advertisers - if properly monetized and well-structured. Still, it is important for YouTube influencers to read and fully comprehend the contractual fine print before signing with an MCN. With this in mind, joining an MCN can provide possible benefits that may not be easily attainable for solo content creators.
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Alternatively, influencer marketing companies and social media influencer agencies offer both top YouTubers and digital stars viable opportunities to monetize their talents and create lucrative brand partnerships.
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