Taking on Netflix turned out to be a fool’s game
In 2016, YouTube made a big push into producing original content, but after more than six years and several major setbacks, the project is being shut down in favor of pursuing different investment opportunities (via Variety). Chief Business Officer Robert Kyncl explained the closure on Twitter and also announced that YouTube Originals head Susanne Daniels would be leaving the company in March.
It was hoped that Originals would be YouTube’s answer to Netflix and other major streaming platforms, but by 2019 it was already decided that it would move away from the paid show model after canceling two upcoming series. Cobra Kai moved to Netflix and Step Up went to Starz as YouTube streamlined its original offerings and focused on music and celebrity content instead. That seems to have not worked out well enough to keep the project going, and Kyncl states that only Black Voices and YouTube Kids programs will continue to be funded, and already contracted commitments will be honored.
Kyncl points the burgeoning YouTube Partner Program and the $30 billion it’s paid out to more than two million creators over the last three years as evidence that YouTube doesn’t really need Originals to ensure that there’s unique and exciting content on the platform. The Google-owned service will continue to invest in other initiatives going forward, such as its Creator Shorts Fund and Live Shopping programming. While Originals may have seemed like an expensive experiment for YouTube, the bottom line is that revenue has been steadily increasing every year — it was just shy of $20 billion for the year 2020, up from $0.8 billion in 2010 — so it can afford to take some shots that miss. And we all know that Google isn’t afraid of cutting its losses and killing services when it’s not seeing the desired returns. Frustrating though it may be, it’s proved to be a successful tactic over the years.
Thanks: Moshe E
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