Last week, Spotify’s former chief economist Will Page published a new study called Twitch’s Rockonomics which claims that artists make 3-15x more on Twitch than streaming providers. Bold claim! It’s not untrue, but the reality is more complicated than that.
Twitch is a complement, not a replacement. Artists use Twitch to livestream content to their fans. Those artists can monetize on Twitch by charging monthly subscriptions (for $5, $10, or $25), earn digital tokens called Bits, or generate ad revenue.
The report positions Twitch as a lucrative complement to streaming, especially for an artist’s superfans. Kevin Kelly’s 1,000 True Fans post is mentioned often. In many cases, artists can earn much more total from Twitch than they do on all streaming providers combined.
But it’s fairer to compare Twitch to products that also target superfans. Patreon is a better comparison. On both platforms, artists monetize superfans by charging monthly rates for exclusive content. Similarly, live performances are a superfan product. There is likely a high overlap with Twitch subscribers.
Unfortunately, those comparisons won’t generate the same headlines! These reports are both PR tools and pitches to future users, which shifts their delivery.
The “pitch report” trend. In the past few months, several streaming companies have released or commissioned reports to show creators why their platform is the best to monetize on. Here are examples from Spotify, Apple Music, SoundCloud. Each report is numbers-driven, full of case studies, and takes a few liberties in how they stack up against their peers.
The “creator economy” space is heating up. Companies big and small want to ride the wave. Companies like Clubhouse, Patreon, and Splice had gotten more funding and higher valuations as a result. Platforms are competing for the attention of both audiences and content creators.
Not for the superstars. All these platforms want to attract successful “middle of the pack” artists. Not the superstars, but the next few levels below. But they’ll be most successful if they focus on owning a lane. They can use the same strategies the artists use themselves to separate from the pack.
Read more about Twitch’s strategy in the Rockonomics report.