Technology

Twitch and YouTube Shift Away from Mega Deals with Top Live Streaming Gamers

In a significant change of strategy, Amazon’s Twitch and Alphabet’s YouTube are phasing out their multi-million-dollar content deals with leading live streaming gamers. For years, these platforms engaged in bidding wars, offering seven- and eight-figure contracts to top gaming influencers. However, recent statements and actions from Twitch and reports of a similar shift from YouTube suggest that this approach may not be sustainable.

Twitch’s CEO, Dan Clancy, acknowledged the pitfalls of this strategy, stating that it had “created this bidding war, and I don’t think that’s a sustainable business.” This marks a pivot in Twitch’s approach to content creators. Previously, Twitch required exclusivity in its contracts with partnered streamers, but it stopped this practice in 2022. At this year’s TwitchCon conference, the company announced that streamers can now broadcast on other platforms simultaneously, such as YouTube, TikTok, or Instagram.

While there are still streamers with custom deals on Twitch, Clancy expressed that these arrangements are being significantly reduced in favor of standard terms. This shift suggests that platforms are moving away from the exclusivity that once characterized their agreements with top gaming talent.

YouTube is also following suit, according to sources familiar with the company’s strategy. The video-sharing giant is scaling back its deals with top gaming livestreamers and shortening contract lengths. YouTube’s motivation for this change appears to align with the evolving landscape of livestreaming.

The competition between Twitch and YouTube to secure top gaming talent has been fierce, with both platforms believing that these influencers would attract massive audiences and boost advertising revenue. However, the shift away from exclusive deals reflects a changing understanding of how to foster long-term growth in the livestreaming industry.

This transition comes in contrast to the trend a few years ago when platforms were eager to make substantial investments. In 2018, Twitch reportedly paid $90 million for exclusive rights to stream Activision Blizzard’s Overwatch League esports. However, when YouTube took over those rights, viewership declined, revealing the fluid nature of the audience.

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Additionally, niche streaming services like Kick, which is owned by a crypto gambling company, have entered the scene, offering lucrative deals for nonexclusive streaming rights. Twitch celebrity Felix “xQc” Lengyel, for instance, signed a $100 million deal with Kick in June, signaling that smaller platforms are increasingly attractive to creators.

While mega-deals once made headlines, the shift toward more flexible arrangements and nonexclusivity is indicative of the evolving dynamics within the livestreaming industry. These changes could create a more sustainable environment for content creators while offering audiences a broader range of content to enjoy.

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