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YouTube Red marks a turning point for games media

Google launching a subscription service focused on game content sends a clear signal; an era is ending in online advertising

The arrival of YouTube's new subscription service, YouTube Red, has not exactly been greeted with open arms; aside from its rather unfortunate name, whose similarity to a popular site devoted to vigorous one-handed appreciation of the Scandinavian visual arts has not gone unnoticed by wags all over the Internet, it's also earned brickbats for aggressive and clumsy attempts to force top YouTube creators onto the service, brutal treatment of those who decline, and slightly hapless mistreatment of smaller rights-holders outside major territories. Videogames, or more precisely videogame-related YouTubers, have been at the centre of the resulting maelstrom, with the immensely popular PewDiePie seemingly chosen by YouTube to be the face of its PR fightback.

That's a testament to just how big games are on YouTube. Game-related YouTubers, Let's Play series and other game-related content forms a very significant proportion of the service's most-watched (and hence most commercially viable) content. Everyone in games is aware on some level of the incredible success of YouTubers like PewDiePie or Yogscast (and its many spin-offs), but the extent to which videogames and gaming culture form the backbone of YouTube, not only in the Anglosphere but around the world, is still lost on many of us. This is a huge, huge entertainment segment, accounting for tens if not hundreds of millions of viewers, countless hours of viewing on a daily basis, and driving incredible amounts of advertising revenue. It's a net positive for the videogames market - it drives sales of games, after all - and one whose scale as a standalone market sector is regularly underestimated.

"If ad-blocking on iOS9 was a watershed, YouTube Red is a clear turning point. Google, king of online advertising, wants to explore new business models - and if they're at that point, the rest of the media will inevitably follow"

Games, and the consumers of game-related content, are a big part of what YouTube Red wants to capture - and I think it's worth stepping back for a moment to consider just what an unusual service YouTube Red is, from a business perspective. YouTube belongs to Google, a company built entirely around the notion of delivering targeted advertising to Internet users. Google's business model, which frequently makes a mockery of its "do no evil" slogan, revolves around building essential Internet services, giving them to people for free, and then selling access to those people to advertisers. If you use Gmail, Google Search, Google Docs or any of a host of other Google services for which not a penny is paid, you're not Google's customer, you're its product. That's the entire Google business model (and it's also, incidentally, why despite the company's many failings I find myself more comfortable with Apple products; the money I pay for them means I'm Apple's customer, not its product, and my information isn't for sale).

Why would a company which has become one of the world's largest and most successful off the back of that model - build an audience, then sell access to it - suddenly turn around and make YouTube, one of its largest properties, into a subscription service? It's an extraordinary volte-face, doubly so for how aggressively and forcefully the company has pushed top creators to assent to inclusion on the ad-free, paid-for Red service. Everything about it seems to run counter to Google's business model and philosophy so far. Why is this happening, and why now?

Here's one big part of the reason why - ad blockers. Once a minor philosophical annoyance for operators of ad-supported websites, ad blockers have become so easy to install and so well-known that they now genuinely threaten revenues from advertising across the Internet. Apple's iOS9, which knowingly and deliberately permits the installation of ad-blocking plugins on iDevices for the first time, is a watershed for this trend; the internet advertising industry has spent the months since its launch dividing its time between being up in arms, and being in a state of outright panic. Ad blockers are among the most popular downloads on iOS now; their presence in download charts is a clear indication, perhaps for the first time for many people, of just how popular they have become.

I have skin in the game. I've worked in ad-supported media for a good proportion of my career. The website you're reading this on carries advertising, and if Internet advertising died tomorrow I'd lose a significant part of my income. I'm not, however, about to deliver you chapter and verse on why ad blocking is immoral and you should disable it this very instant, because I've read far too many of those chapter and verses in recent months and I've thought the same thing every time; "you're an idiot. Fix your business, don't shout at your consumers for not being the consumers you want them to be." While we're at it, let he who hath never fast forwarded the ads on his Sky+ box cast the first stone. Consumer-blaming is a dead alley; the solution to music piracy wasn't to shout at consumers (hey, Metallica), it was to launch great download and streaming services. The solution to TV piracy wasn't raging at people refusing to subscribe to ludicrous cable bundles or wait for insanely priced DVD boxes, it was Netflix, HBO Go, iPlayer and all the rest. The solution to game piracy, by and large, has been Steam.

In each case, an industry fixes the bulk of its problem not by railing against consumer behaviour like King Canute bellowing at the relentless tides, but by introspection and innovation. What are we doing wrong that's making consumers willing to jump through hoops to avoid using our existing offerings? (Piracy is almost always far more of a pain in the ass than just paying a reasonable fee for a good service offering; this is true for the vast majority of consumers, and it's not worth obsessing over the tiny percentage who simply object to paying money for anything ever, no matter how awkward the alternative.)

The answer to the "what are we doing wrong" question in the case of online advertising isn't hard to see. Install an ad blocker on your laptop or, better yet, your phone, and the problem is instantly apparent. Many sites - even big, popular sites - are loaded down with so many ads, so much privacy-invading tracking code and so much marketing-related cruft that they load in half the time or less when shorn of it. Giant banners, pop-overs, unskippable videos, deeply sneaky tracking and profiling systems; we may be rid, at least, of the classic "screen full of porn pop-ups" beloved of bad romantic comedy movies of the early 2000s, but the techniques in use today even by very mainstream agencies and brands are no less negative in their impact on the quality of life of internet users. The bad decisions which brought us to this point, where ad blockers are known and used by the general public and not just by tech geeks, have been slow and cumulative; one marketing exec strong-arms their way to a more obtrusive, less respectful of privacy ad; his or her rival in another company wants that, and a little more besides, for their next campaign. Inch by bloody inch, and despite the earnest opposition and appeals for sanity of many of the better online media operators, online advertising has pushed itself into a position of being egregious, abusive and awful - and "how can I get rid of all these ads" has only ever been (ironically!) a Google search away.

If ad-blocking on iOS9 was a watershed, YouTube Red is a clear turning point. Google, king of online advertising, wants to explore new business models - and if they're at that point, the rest of the media will inevitably follow; some bright, progressive businesses are already leading, for that matter. There's a clear need for some kind of revenue model to fund professional content creation on the Internet; this is something that's vital to the videogames industry at large, large swathes of which are strongly dependent (whether acknowledging it or not) on a healthy, successful games media. We have some solutions that work already at extremes of the market - Patreon and its ilk support individuals creating interesting media in niche spaces, while heavily publisher-backed media (whether labelled as such or not) creates what are essentially marketing stories for AAA titles.

"Just as the transition from print to the web killed some old giants and created some new ones, the new transition we're undergoing right now...is going to be impossible for some, and a huge opportunity for others"

The vast majority of the games media, though, lies in the middle between those extremes; taking money from publishers and other advertisers, but retaining, more or less, independence and editorial freedom. This is no easy balancing act and does fail on occasion, but a lot of very skilled, dedicated people, working in print, on the web, or in video, have worked for many decades to keep the balance and, for the most part, they have succeeded. This is the vital sector that's most threatened by a decline of traditional advertising; it's the sector that most needs to find solutions, working with its audience and with the industry at large, to give it the ability to make money without being forced entirely into a twilight world of advertorials and paid-for content.

Some solutions are already presenting themselves, a YouTube Red style subscription service being just one of them. Paywalls are largely speaking a dead end (they kill audience growth, which means they're only effective at managing decline - probably why newspapers, already unconsciously resigned to a steady slide into obsolescence, seem to like them so much), but optional subscriptions for extra content or access is a promising model, and streaming video like Twitch - which totally eludes ad blocking and increasingly plays host to tournaments and other such "event" programming that is appealing to sponsors, not just traditional advertisers - has enormous potential. Other models, encompassing everything from social networking to microtransactions to real-world events and showcases, are out there to be explored and developed. Just as the transition from print to the web killed some old giants and created some new ones, the new transition we're undergoing right now - the final death of the old, mutated and despised "banner ad" concept of web advertising, and the adoption of new revenue models in its place - is going to be impossible for some, and a huge opportunity for others.

The transition will happen, though, because the fundamentals haven't changed. The relationship between the games industry and the media which covers its products may not always be cordial, but it's essential - not for all product types (I buy the argument that many mobile titles may be better positioned as FMCG titles, with broad based advertising, and that specialist media coverage for them is essentially a waste of everyone's time) but absolutely for core titles, and more than ever for indie and niche games. Moreover, consumers, especially those core and niche consumers, are still going to want media; not the way it was yesterday, probably not the way it is today, but in new forms that work for the game consumers of tomorrow. As long as that triangle is intact - game creators, game consumers and game media - some kind of business arrangement can and will be reached that allows the media to be supported by the other two sides of the triangle. It'll be a rocky road to get there, and the learning curve won't be a nice shallow gradient - but the first step is for everyone to open their eyes and turn them to the future. After all, every moment spent complaining about ad blockers is a moment when you're not figuring out how to survive in a world where they're simply a reality.

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Rob Fahey avatar

Rob Fahey

Contributing Editor

Rob Fahey is a former editor of GamesIndustry.biz who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.