Could Creators Save Paramount?

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Hi, I’m Jim Louderback and this is my weekly creator economy newsletter. If you’re reading this then you are either subscribed or someone forwarded it to you (or you are reading it on the website).

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How The New Paramount Can Become More Creator Friendly: New Paramount owner David Ellison (of Skydance) claims he wants to make Paramount a “creator friendly” environment. It’s going to be a tough slog for a company that has flip-flopped many times. From 2007 to 2014 Viacom (now Paramount) sued YouTube for copyright infringement, thus losing a whole generation of teens. They flirted with Musical.ly before Bytedance snapped it up – and then purchased VidCon, Awesomeness and Whosay in 2017 and 2018, along with hiring visionary exec Kelly Day to build Viacom Digital Studios. But they abandoned that strategy in early 2020, increasingly neglecting those acquisitions in the Pluto/Paramount+ era. And according to Passionfruit, VidCon is now being actively shopped by an investment banker.

There are still some talented creator executives at Viacom, either tucked away inside Nickelodeon (looking at you, RJ, Alex and Ashley) or in the LatAm and VidCon teams (but for how long). Most have jumped ship for friendlier pastures (myself included).

Step one? Realizing that the creator-friendly playbook has inverted over the last five years. Creators today don’t need Paramount. But Paramount really needs creators. It’s not about lavishing big contracts and red-carpet access on influencers repped by CAA, UTA and WME. It’s about truly embracing creators as savvy DTC businesses and creative savants – and partnering as equals. I

t’s also about a global vision, not one rooted just in LA and NY. You can still buy your way in, but that window is closing. Only by establishing an autonomous and truly creator-first division – with a mandate to infect the rest of the old-school org – will Paramount have a chance of success.

And then move beyond the mountain to integrate with Redbird’s other creator-first companies, including All3’s Little Dot Studios and Hidden Pigeon. Build on Paramount’s internal Roblox expertise with Build a Rocket Boy and Skydance Games to create experiences in virtual environments that creators want to embrace. And integrate with the Fenway Sports Group and the UFL as sport transitions from league and team to the player-creator. Maybe you could even entice Kelly Day to come back as Chief Creator Officer.

RELATED – New Research Proves Why TV isn’t the Answer: Kaya Yurieff, writing about the dearth of creators successfully moving to TV ($) ended on a hopeful note (for Hollywood), “Too many viewers are glued to YouTube and TikTok to drop the idea of featuring creators (on streaming services) altogether.” But new research from Variety VIP ($) seems to prove the opposite. Hollywood hoped that as the YouTube generation aged, it would eventually abandon social video and develop a TV habit. That’s not happening – with two thirds still using social video daily (compared to 4 out of 5 GenZ), but only 44% leaning into TV. Also Millennials cancel paid SVOD more than any other demographic, while nearly half prefer the algorithmic videos served by social platforms over streamers and broadcast channels. It’s hard to break media habits formed in your childhood.

Creator Economy Investing Turns Up – Exits Still Flat: Funding for creator economy startups is turning up, according to The Information’s Creator Economy Database – over $600M in Q2, which doubles Q1s amount. But according to Luma Partners quarterly digital media and ad tech report, exits remain flat for digital media (notably led by BeReal, Refinery29 and the Onion). Luma also sees a 25% QoQ increase in venture funding but cautions that it’s still down from 2022’s average. That could be a problem in a few years if exits don’t budge and startup funding continues to grow. Also worrying – they see AI driving the VC increase, rather than digital media.

No More Anonymous Messaging for Kids: The US FTC agency just permanently banned companies from marketing anonymous messaging apps to kids and teens. The broad ban was an outgrowth of a $5M fine leveled against NGL Labs for targeting kids with a supposedly safe messaging app that was anything but. NGL violated a variety of laws protecting kids, including COPPA. Even though COPPA focuses on kids under 13, the FTC clearly is now focusing on protecting teens too. In addition, this case signals that the FTC is serious about prosecuting companies making false claims about AI in their products too (see Humane, Rabbit and scores of other products). My analysis and comments here.

  • Related: 36% of 2-5 year olds watched TikTok “recently” based on a deeper look at the PreciseTV / PARK research we explored last week. And it’s even higher for older kids – 37% for 6-9, and 49% for 10-12 year olds. A quarter of even those youngest kids watched Instagram – and around 80% across the board watched YouTube recently. I get YouTube, but in no way should kids under 13 be poking around TikTok or Instagram.
  • Related: TikTok reduces ad targeting to teens – why didn’t this happen sooner, and why not just go all the way.

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TikTok’s Sales Event Falls Flat: It looks like TikTok’s four-day Deals for You stunt was a non-starter. Extended to the 17th (so it now overlaps Amazon’s July 16-17 prime Day), there’s very little discussion on TikTok, Google News or Reddit. A random walk through the Deals For You store shows the usual mix of low-cost crap, brand rip offs and stuff designed to lure the unwary ($7,600 for an AI generated monkey, but with $40 off – or perhaps $7,500 for cow slippers, but with free shipping). Let me know if you discovered any bargains, but from what I can see this wasn’t a success. But because everyone gets their own TikTok, YMMV. Let me know if you bought anything and why, and I’ll be back next week with an update.

SPONSOR – Creators Do Punch Well Above Their Weight!

Nielsen reported that Whalar campaigns had an ROI of $2.41, surpassing all other media channels. More importantly, creators are efficient – while making up less than 1% of total media, they contribute 3x the impact. Check out the full Media Mix Model (MMM) study here to learn more about how creators are media investments.

QUIBIS:

YOUTUBE

META

TIKTOK

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OTHER CREATOR ECONOMY

CREATOR TECH – AI, WEB3, VR, MORE

RESEARCH

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I’ve built and sold multiple creator economy startups to top media companies – including Discovery and Paramount. Subscribe here on LinkedIn to get this newsletter every Monday.

Let me know what you think – email me at jim@louderback.com. Thanks for reading and see you around the internet.

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