TikTok Going Down – This Time Feels Different

Sorry this is late. Had wordpress problems. Turns out you can’t paste text with emojis in it. Who knew?

This Week: Feds spoil TikTok’s creator summit, which was long on promise, short on details. Plus the maturing of Mr. Beast, Rooster Teeth takeaways, research proves nano creators are best, 4 research studies you need to see, unexpected AI prompting tips and much more.

This Time Feels Different: The US government is considering a bill that would force TikTok to sell. Again. But what’s different this time, according to an insider friend, is that it has quickly gathered bipartisan support – and the national security implications are very troubling to many feds. TikTok reacted predictably, imploring creators to phone up their representatives and complain. That did not go well (while disproving the canard over GenZ’s lack of telephone prowess). For more, check out Casey Newton at the Platformer.

Hollywood Reacts to Chicken Little: Tyler Perry cancelled his $800M studio due to AI generated video fears. Variety’s latest story attempts to put that in context. Yes, storytelling is hard. But the risk is real. Large Visual Models, starting with Sora, but including tools like Runway and Augie, increase access to storytelling tools that have been only accessible to WETA-class companies and big VFX houses. Just as PCs and mobile and YouTube and TikTok let anyone become a video creator and reach a global audience, this gives millions more access to super-high-quality tools, locations, and capabilities. Also, media has also gone from discovery to replacement. With 11-13 hours a day spent consuming media there’s no more TIME to experience more media. If these generated videos take up 5% of your daily media diet, what do they replace? For a bit of skepticism, some think it’s just a great demo. Word from those trying Sora, though, is that it really is all that and more.

The Maturing of Mr. Beast: More story, less speed – Mr. Beast jumps on the slow-content trend. 14 years since the launch of “Kids React” by The Fine Bros, it feels like this reality TV format has run its course. Reminds me of Reality TV’s arc on television, as Survivor and Big Brother led to an explosion of copycats – the nadir was likely “Here Comes Honey Boo Boo”. Happily, most of the bad examples have faded away – as they will on YouTube too. Survivor survived – and Mr. Beast will too. And I predict YouTube will become a friendlier, less frenetic place as a result.

Why Smaller Influencers Drive Outsized ROI: A new academic study finds that brands get better ROI when they work with nano and micro creators than larger creators. Why? Because more followers lead to less engagement per follower. The study looked at nearly two million sales data points across hundreds of paid endorsements and analyzed both revenue and cost of campaigns.  The Nano and Micro creators beat larger creators on all three metrics: Revenue Per Follower, Revenue Per Reach, and Return on Influencer Spend. The ROIS numbers were particularly telling – larger creators drove 3x more revenue but were 18x more expensive than nano-creators. Note the study only looked at DTC companies in fashion and beauty – and creators between 1,000 and 1.4M followers. But it’s still telling to have academic rigor applied to ROI in the creator space. A summary of the research is here.

Rooster Teeth Shuts Down: So sad to see this pioneer of online video shut down by its fading corporate overlords at WB Discovery. It’s an epic tragedy with more twists and turns than a George RR Martin novel. After selling VidCon to Viacom I had 5 bosses in my 5 years there – I can only imagine how the team survived five OWNERS in the 10 years since being acquired by Full Screen. Hard to execute a successful strategy when you can’t remember the way to the executive washroom.

Good News from TikTok’s First Creator Summit: Positive news from the “For Creator: Future Formats Summit”, including 50% of watch time now goes to  longer videos, an increase of 350% since 2022. TikTok also enhanced payouts for longer videos, as their “Creativity Program” now becomes the “Creator Rewards Program”. Videos over a minute long will be scored based on originality, play duration, search value and audience engagement. Subscriptions are also now available to both live and on-demand creators. And TikTok announced a new “Creator Center” to help creators make better videos and more money. All well and good. But I asked TikTok’s press team for clarification – but didn’t hear back at press time. Here’s what we don’t know:

• What do they consider long-form (a minute? 10 minutes? 50 hours?)
• What makes a creator eligible for the subscription program?
• What makes a creator eligible for the Creator Rewards program?
• Announcing a formula implies math. How do you define and weight the four variables that determine payouts in the new program – Originality, Play Duration, Search Value and Audience Engagement?
• Total creator revenue (from the creator program) increased “by over 250% within the last 6 months”, and the number of creators making $50,000 each month nearly doubled”. What was the total revenue paid out, how many creators are in the program, and how many creators made $50,000 or more?

I applaud the essence of the announcements, but without specifics on who can participate and how videos are scored – and how payouts are calculated – it’s seemingly just another way for TikTok to create the appearance of rewarding creators while only supporting a small fraction of deserving talent.

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QUIBIS:                                                                                

YOUTUBE

• YouTube grossed an incredible 8 BILLION dollars through its mobile app on IOS.  It only took 13 years.
• YouTube posts a heartfelt “Thank You” to @MatPat as he retires (nice job @rene ritchie).
• Related: What MatPat’s up to next.
• X/Twitter plans to launch at TV app to compete with YouTube.

META

• One Ring to Rule Them All – Meta working on a single AI model to run its “entire video ecosystem”.
• Call Me Meta!! Except in Brazil.
• Temu spent $2B at Meta last year – we need more crazy Chinese E-commerce companies to dump money into the US ad market!
• The latest Instagram updates from the source.

TIKTOK

• TikTok creators lean into the medical void with Ozempic side-effect advice – both good and bad.
• TikTok likely to lose more music – the NMPA does not plan to renew its license.
• The Atlantic argues that TikTok is just broadcast TV these days ($).

BRANDING AND MARKETING

• Backlash brews over product seeding and gifting.
• Check out the latest influencer marketing startup Emanate, launched by old friend @Rob Bernstein.
• Tarte responds to the Bora Bora backlash comparing their efforts to a Super Bowl ad. This is NOT how you do crisis communications.

OTHER CREATOR ECONOMY

• Great analysis of the M&A market in the creator economy, including “Buzzy MCNs” (?), podcasting, YouTube channel acquisitions and more.
• Josh Richards launches “pro” sketch comedy series across TikTok, YouTube and more – and presumably it’s ripe for TV too.
• YouTube, LinkedIn and Meta experience outages on “Super Tuesday” in the US. Coinkydink?
• I was wrong about Reesa Teesa – although now that she’s signed with CAA, things should get interesting.
• Loved listening to the vision behind Fizz at Web Summit last year – it’s a unique take on campus social media. Alas, Fizz, YikYak and more are now banned at UNC.  The beginning of a trend?
• CEO Dan Clancy lays out Twitch’s 2024 priorities. One he forgot to mention: Turning a profit for corporate parent Amazon.
• Related: @Mike Shields wonders “What happened to Twitch”? It was great hanging out with him on his podcast last week, talking YouTube and the Creator Economy.
• @lia Haberman wrote a great post about why she publishes her wonderful newsletter every week. I couldn’t have said it better myself – it’s exactly why I do this every week too. PS, if you like this free newsletter buy me a coffee and say thanks!
• Drama in the Minecraft server world.
• LinkedIn leaning into news.
• Jay Shetty gets cancelled by The Guardian.
• @Hank Green interviews @Nilay Patel on Nilay’s podcast. Read the transcript or listen: “It’s fun to be smart!”

GENERATIVE AI

• Update from the front lines of human / AI infatuation.
• AI video generation tool Pika now includes lip-sync audio. The demo video is pretty cool.
• Anthropic’s new Claude 3 attracting attention for being “scary good”.
• Insightful essay on optimizing AI prompting and how “Being good at prompting” probably won’t be a viable future career path.

RESEARCH

• Three new studies show TikTok’s engagement dropping – in some cases by more than half.
• Tubular releases its “State of Video 2024”, tapping into its vast storehouse of video consumption data.
• Maybe social media doesn’t lead to article readership.
• Edelman and LinkedIn released a Thought Leadership study with guidance on how to take your content from good to great – including referencing strong research, explaining relevant business challenges and offering concrete solutions and examples. This newsletter, btw, could be an excellent part of your thought leadership program – as I reach 27,000 decision makers each week in the creator economy. Check out Inside the Creator’s sponsorship packages and/or email me at jim@louderback.com

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.

Thanks for reading and see you around the internet.