Night Media's Reed Duchscher on managing MrBeast, YouTube's monetization dominance, and the creator economy's future

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You know, I I missed the yellow jacket and pants.

Yes. Yeah. Ano. It was It was uh it So, our our lead sponsor RAMP raised a big fundraising round today. Uh we had the CEO on the show.

Fourth fourth round of the year. We knew they were going to be raising a lot. So, we decided to get these suits.

And when we initially uh Yeah. When we initially thought of the bit, oh, let's get some yellow suits. Uh, I sort of assumed that we'd just go and buy like a yellow suit from Target. Uh, Jordy called our tailor and [laughter] got a very nice tailored yellow suit and I was like, that's that's hilarious. It was very funny, but we wound up using it a lot. They look great.

They look pretty great. Uh, anyway, please introduce yourself for those who might not know.

Oh, yeah. My name's Reed. Uh, founded a company called Night. You and I have known each other now going on probably like three years. Um, but we represent the biggest creators on Twitch, YouTube. It's it's kind of taken on a life of its own now. I'd say we're like the the idea at the beginning was like be the internet's management company. That's kind of transitioned to like be the internet's media company. And so we bought a podcast network from Warner Brothers called The Roost. We have a venture studio. Uh a few things that have come out of that like Fastables with Mr. Beast, Tone with Kaiet, uh Outtake, which is a company that you guys are probably familiar with. So that that's a little bit of the company. And then, you know, I represented Mr. Beast for seven years. So it was a a crazy seven years.

Okay. Maybe maybe we start with like a like a state of the union in just like where opportunities are for creators. Uh it felt like Tik Tok was the hottest place to to if you were going to be a creator, uh Tik Tok was the place you could go break through. Then Mark Zuckerberg copied it with reals and and YouTube answered with shorts and um maybe the plateau in Tik Tok world was like a little bit like maybe they were slowing down and then they were going through this will it get banned will it won't and so there's a little bit of hesitance if you're a new creator to maybe pick that platform. Uh is that overstated? Is there still opportunity on Tik Tok?

No there is. I I think being a creator today it's the easiest it's ever been just because discoverability is so easy. Y with Tik Tok is the algorithm has gotten so good that like if you the three of us pulled up our four you pages like all of them would be completely different. So I think breaking

it also makes it more competitive for existing creators where the if you were living in a world that was like wasn't algo feeds if you just got to a critical mass of subscribers. It wasn't it wasn't as competitive with like a new creator would have to grind it out for 5 10 years before they could actually be competitive. Even now, if you're just making better content, it will get surfaced faster.

Yeah. Yeah. If you like during co everyone was seeing Charlie D'Amilio dance videos like she went from zero to 100 million. That's very challenging to do in today's world just because your content gets fed to the people that only want to watch that and your content doesn't get seen by people who don't want it.

I think the the platforms have actually done the same thing across the board where they don't really want creators to break out and become a Mr. Beast anymore. They'd rather like widen out the mid tier. And so they'd rather have, you know, YouTube, for example, I think, would rather have 10,000 creators with 5 million subscribers than have a 100 creators with 100 million subscribers. Like they don't they don't want that. I think a lot of that is like they don't they also don't want creators to have any leverage against the platforms. And so it's been interesting seeing that like shift over the last three years to this like, you know, push down a little bit further and make make it harder for people to really break out.

And what is the nature of of Mr. beast leverage over YouTube. Is it just that if he says YouTube isn't treating creators uh you know correctly that'll be front page news or is it something more about the structure of his business?

I think a lot of it is when you know there is like negative press and we we saw this for those people that are like OG YouTubers like PewDiePie kind of went through this whole like ad apocalypse back in the day that was very negative on the platform as a whole. And so I think when you when you get individuals that are at the top of those platforms and they start to almost overshadow the platform because they've gotten so big um that when negative press starts to come out about them now advertisers are pulling out. We started to see this a little bit on Twitch um because it is a very topheavy platform. And so I think that has a lot to do with it. You know, I think um in in Jimmy's case, like

for the longest time, you would go on trending page and he was just dominating trending page.

And so it's, you know, now it's like people don't really go on trending page, but even on on homepages now, there's a lot of variety of different content. That's ultimately what the platforms want. They're trying to widen out their fan base as well.

Uh talk about the evolution of Twitch. It's uh you know, you gave us the basics on Tik Tok. Twitch is interesting uh because when I see what Google is doing um YouTube is like front and center in so much of what uh YouTube does and yet I feel like with Twitch it's not really the front and center uh you know star property for Amazon as a corporation. Uh and I'm wondering if that reflects just it being a little bit more arms length a little bit newer of an acquisition maybe. I mean it's still been a decade but uh what what's the vibe on Twitch these days

man? Um, we could have a whole conversation about this. I I think your your observation is correct that Twitch inside of Amazon,

they haven't really cared about it. You know, they they'll do deals now that is predominantly focused on Amazon Prime Video and Twitch is is somewhat ignored.

You know, I I do think like it's such a small like peanut inside this Amazon ecosystem that even if Twitch's revenue quadruples, doesn't really do anything for for Amazon as a whole. And it also has this weird dynamic where uh and correct me if I'm wrong, but there might be a lot of money being made on Twitch, but a lot of it is driven by the Twitch Prime program, which is not actually new dollars for Amazon, whereas uh subscribers on YouTube, uh YouTube uh premium subscribers, that's just actual dollars that people are paying.

Yeah, you're saying like net new or I can explain that for a second. A couple years ago, Amazon released something where where every Amazon Twitch or sorry, every Amazon Prime person gets a free Twitch sub. So, they can essentially use their Amazon Prime to subscribe to some person's Twitch, which which would be $5 a month in most cases. So, what you're saying is like, no, that's no longer net new revenue. They've never released how many actual Twitch like subscribers are like actual Amazon Prime. So, we have no idea, but I would guess it's a large number. It felt like it was like at least in the early days it was like 80% because it was like my parents have have anybody try to make a stream that's just like make me a millionaire and they're just streaming and they're just trying to get people to like use their one Amazon sub.

I mean tell stories about subathons.

Yeah, I mean the subathons became a thing a couple years ago. Kai's obviously had the most notable one. He had Mafiaon which led into the third version of that that we did this last year. Um and it was you know 31 straight days 24 hours a day. Okay, he had he broke a million subscribers over a 31-day period. But subathons are not a new thing, but people using Amazon Prime to subscribe to Twitch has been around for a while. And that and that is like the hook that a lot of people use. They'll be like, "Use your one Amazon Prime sub on me." Uh, and but the and so Twitch does like we know kind of what their advertising revenue is, but we have no idea what the makeup of like a Twitch Prime subscriber is. Um, but it it has been disappointing. I think from someone who sits on the creator side that, you know, whose company represents the majority of of the Twitch streamers, you know, YouTube leans so heavily or Google leans so heavily into YouTube as as a platform underneath their umbrella where Twitch does feel like this like kind of like band of misfit toy inside of Amazon that they don't really care about, don't really talk about. uh even when they do the,

you know, the the NASCAR deal and they're negotiating to get all these rights for the NBA, it doesn't even feel like Twitch is in those conversations, that that's also been frustrating for us, too, because for a lot of guys that are streaming on Twitch, that's their main distribution. Uh they don't feel like they get any love. [laughter]

I think that we would have to uh

because I know No, and I and I I know like I it sounds crazy, but there's a world where you have all of the talent, like a lot of the most important talent on the platform. There's a lot of investors out there that if they would happily probably if you're like, "Hey, this is being under, you know, this underappreciated Amazon and we can turn it I don't know what what wasn't it like a billion dollar acquisition."

Yeah. Like that that it feels like worth well more than that.

The psychology of the 999 is so funny. It's like clearly there was some weird board fight.

I just don't know why Amazon would sell it. Like why would they part ways with it? It would only ultimately make them look bad if someone could come in and and actually operate this. So,

I don't know. I would be the first in line, but

we we were joking about how uh we were praying for Andy Jasse to to get on Twitch because uh obviously he's a very buy the book uh you know, he operates AWS. He's a very quantitative uh executive. Uh but if you look at like Mark Zuckerberg, he's on Instagram. He's using the platform and it's like, of course, Apple's keynote will be streamed on Apple TVs. Of course, Google's going to do IO on YouTube. And yet, Amazon hasn't really leaned into Twitch in that way of like, hey, maybe if we bring our executives here, it's always been like it's a little bit too crazy. Like, that's a little party and we're like a little bit more serious.

You you'd have to think like if you're going to pay a billion dollars for the NBA rights that you would have to allow Twitch streamers to go stream courtside whenever they want. they get full locker room access. Like you'd have to open up the aperture so all those creators could benefit from Amazon owning the NBA rights which ultimately like just keeps people in the system that can then watch the games or watch their favorite Twitch streamer backstage or whatever that stream ends up being.

Who who knows like it hasn't been fully integrated in any meaningful way. Whereas uh with with YouTube is like front and center in so many of the different parts of the ecosystem with like V3 and that generative AI stuff. It flows right back. Yeah. And so, uh,

what's the best timing?

What's the best platform to be a top creator on? When you think about, uh, Twitch, YouTube, Instagram, Tik Tok, it's it's to me not even I it's not even a question. It's YouTube by far. Like, I I think just their alt monetization, their AdSense monetization, like if if you're at the even in the top 10,000 channels on YouTube, you're making significant income. And I've said this for a long time, like we we kind of value a fan of just like relative time spent with that individual. And people are spending a lot more time with individuals on YouTube than they are on Tik Tok. You know, you'd have to watch I don't even know how many Tik Toks of a single person to get up to like a 17-minute Mr. Beast video where the average person's consuming 70 to 80% of that video. Yeah. So,

do you believe in this? Uh I like this exchange rate concept, but maybe it all just boils down to watch time. Um, but I feel like it's it's ten times harder to get like a live viewer than a video essay viewer. It's 10 times harder to get a video viewer than a shorts viewer. Maybe there's maybe there's like a chain of exchange rates through these things.

Yeah. But you you can parlay it now on YouTube, which is why I said YouTube, because you can use YouTube shorts as the discoverability mechanism, which is a lot easier to get someone in the door to then figure out what your content is to then create long form videos to now they're watching a 20-minute video and they're watching mid rolls and a unskippable ad. And so I think YouTube has done such a masterful job of just like continuing to build the platform for a amazing place for creators.

Yeah. What do you think about this uh this idea that like YouTube just seems to be coalescing around the old TV formats? Like Mr. Beast, it feels like he landed on like oh it's about a 22minute video which is like exactly how long like an episode of the Simpsons is in a 30-minute time slot and then there there will be around 8 minutes of ads because that's just the ad load that TV discovered and some of those will be in in the video and some of those will be out of the video. that effectively it just feels like humans landed on like yeah like half an hour slots.

Yeah, I think um a a lot of it comes down to um yes, you can put multiple midroll ads within a 22-minute video and so you can kind of just understand like how many mid rolls you can fit in a 22-minute video. But TV watch time on YouTube is now I believe 11% of of watch time consumed on an actual like smart TV. And so YouTube also is feeding those those videos into a system and and YouTubers have gotten smart. A lot of them have syndicated their videos on other platforms like an Amazon or a TubeBu. And in those formats, usually you have to deliver a video that's like 20 to 25 minutes in length. You can't distribute a ton of videos that are 9 minutes onto Amazon or Tuby or some of these other places. Uh and so I think just creators have gotten smarter over the years of like playing to the how do I get high AdSense and how do I syndicate my content other platforms. Yeah, there's like these uh oneoff ARB opportunities I feel like that happened like for Snap Snapchat was a was one for a while where the the creator monetization program was really good. I don't know if it still exists in the same like lucrative way, but there was a moment where it was like if you have a backlog on YouTube, just go put it on on Snapchat because you're making money.

It still exists, but you have to make native content. So the the ones that do well like David Dobert does really well on Snapchat. Um but he's making 100 plus pieces of content a day and then the the programmatic ads are just like slated. Yeah. He's he's posting 100 times a day. So So it was like I mean there's a lot of creators that are doing this where it's just like spam posting your entire day. Okay.

Um so you're you're essentially vlogging your entire day but you're filming it in 10 to 15 second increments. And so people will just like continue to click and like watch the entire video and then Snapchat will insert ads and that whole thing and it's done well. I don't know if it's going to continue like that. I don't know if Snapchat will continue to be able to sell ads within that system, but it's worked for the for the biggest creators, at least the ones.

Do you have a prediction there? There was sort of the the era in which a podcaster could get paid 50 to$100 million to like go exclusive. That kind of happened. And there was the same thing happened in live streaming. Do you ever expect like I I don't think both of those have like necessarily panned out that well for the platforms. Do you do you expect somebody to like try to run that playbook back again to like kickstart a new network or do you think it's been

learned enough times that it's not necessarily

I don't know. It always kind of feels like someone has to continue to try to spend $100 million to create a competitor to Twitch or YouTube or Tik Tok. So, I I don't think it'll be the last time. I do think someone else will come to the system and put up money to do some of these things. Mixer probably won't be the last like competitor to Twitch that fails. I would imagine someone else is going to try and do it and they're going to be able to raise a ton of money to try. But we've just seen time and time again that like even in the Twitch example, the community on Twitch is hard to compete against. If you're mixer, you could spend $100 million and still not even put a dent. And like Kick is trying this right now. They're probably the newest one, which is like owned by Stake. Uh, and they've spent hundreds of millions of dollars on trying to figure out how to compete with Twitch, and they just really haven't been able to like really crack any of the live stream market.

Nvidia has not gotten into live streaming yet.

That may happen.

Microsoft, Google, Amazon, all these companies have

plays in live streaming, but not Nvidia. Maybe that

What's your point of view on creator payouts on different platforms? feels like obviously you would love for platforms like Instagram to do at scale creator payouts. Uh we've had a debate on the show whether X payouts are good and we ultimately got to a place where we think like creator payouts on X make the platform worse because the content is relatively easy to make and if you just create the sort of like profit motive on the platform. It just floods the the platform with content that I wouldn't say the content is like better today than it was like five years ago precreator payouts. Whereas on YouTube, making great videos is really hard. And so you talked about it like there's if you can be in one of the top channels, you can make a great living doing it. And that

has a very positive effect and that more people can spend all their time, you know, creating content. But um curious what your view is. Yeah, I think on X like they reward [ __ ] posting like in all the like Twitter meme accounts or X meme accounts like if you start getting likes and retweets like it just continues to go and so like memes do really well or just [ __ ] posting does really well on YouTube it now like comes down to statistics like you need a good click-through rate and a high retention or else the YouTube is not going to recommend your videos. So it's really hard like it's impossible to [ __ ] posts on YouTube. you can like have a clickbait thumbnail, but if the video assets stinks,

that was the craziest thing. Uh Mr. Beast released that video was like here's his video to like 10 years in the future or something. And I think it flopped like I think it it

was only 3 minutes in length. Yeah.

Yeah. It was only 3 minutes in length. it just wasn't in the meta and even though it's like this mind-blowing thing and you know it's this moment it's still just like the algorithm expects 20 minutes and a million dollars poured into the production and so your your face video you're just like hey to the camera video even though it's novel just doesn't break through in the same way

but but if X is ever going to compete with YouTube they have to monetize right like they have to sell ads so I I just I I don't know where they're kind of at in terms of like do we need a video player you guys obviously live stream on on X It seems like they have to get to a point where they are monetizing or they're allowing creators to monetize their content or I just don't see why anyone that actually puts quality Yeah. quality into their content or podcast or whatever would post it on X. Unless you're a podcast and you're already putting five ad reads in your video and AdSense is an afterthought and then you want more scale and distribution by X and you're already monetizing the video. That that I can see. But I just I just don't think if X really wants to compete with Tik Tok and and Instagram and YouTube that they cannot monetize their content.

Yeah.

How early how early are you signing creators today? Cuz it I mean you guys have a lot of leverage from all the talent that you've worked with uh and just the track record. But at the same time, I'm sure that when somebody pops up and now that they get shown to a ton of people really quickly, they can go from zero to millions of views in no time. I'm sure it's like a highly competitive dynamic where in a perfect world, you like, well, I'd like to let this person like create content for another like at least a few months, but if I don't, somebody else is going to like jump in and sign this person and then, you know, maybe it'll be hard to kind of like, you know, take over that relationship.

Yeah, we're we're definitely never the first. I would say we're hopefully the last. Um, usually everyone that we sign already has had like a manager, an agent or like someone in play. You know, I think we come in with a little bit different value prop of, you know, we've done it so many times and kind of have the blueprint for like how do you get a creator to scale then how do you build businesses on top of them that have real enterprise value. So, I would say we're we're a little later and we don't really represent that many people. Um, so we're not like chasing, hey, what's hot and viral at the given moment. Uh although I pay attention to it and my screen time is incredibly high. Uh [laughter] and I don't think that'll ever change. Um but I'm just like I keep an eye on people. I think like you know we have this whole system internally where we just have thousands of creators and we'll just keep an eye on them. What are they doing? Are they It's hard to have like real longevity and it's really hard to stay creative over like years. And so I I see a lot of creators like come and go into the system. They'll make a good video. they'll go viral and it's really hard for them to back that up month over month over month.

Yeah. Or they have like one bit that's hilarious for but and there's also like creators like we there's this guy on on Instagram that we've been laughing at a lot lately. He makes these videos where I don't even know. I I forget the account name, which goes to tell you like it's like it's not a super valuable account, but he has this one joke that we just think is absolutely hilarious

and like there's pro there's probably nowhere for it to go. Like it's probably like he's getting like millions and millions of views

with this one joke and then eventually it'll fade or something like that. But I mean, I think uh yeah, not not all not all views are are created equally.

Yeah. I mean, there's this creator that I really like to watch and he like eats lemons in public places. So, he'll be like on a plane and he'll like pull up. Have you seen this?

I don't know how he does it.

Onions.

He does onions, too. And now And now eggs. Like not a hard-boiled egg, like a full egg, and he'll just chew it. But like that that big

Tyler, get ready to eat eggs, buddy.

Yo, [laughter] have you guys have you guys ever tried to bite a lemon?

It's hard to eat a whole lemon. Yeah. Like he's like gagging. So that that like yes I I can't remember what his Instagram is called which goes to the fact of like I'm like doom scrolling and I'm like oh I found this guy he's hilarious he eats lemons but I'm like there's no real longevity here like I don't know where this goes.

Yeah versus Harris who like you know beautiful storyteller

he's in the thumbnail and he tells you oh he brings you into his whole life so many of those folks that actually do a great job. Do you think uh the nature of some of these live live streamers is actually forcing them to create products and startups or like businesses earlier than maybe on YouTube? Because I feel like a lot of the the Twitch streamers like there's so much unpredictability because it's a live stream that they're not super advertiser friendly.

I think a lot of them have figured out other ways to make money and and that can be like apparel was the easiest one. Like I think a lot of them have Minecraft servers or Grand Theft Auto RP servers or now Roblox games. And so they they've all figured out other ways to make money that's not so centered around Twitch Prime subs or YouTube AdSense. Uh and so I think like just in this like internet world, these like kids are in the crevices of the internet. They just like figure out how to make money. Like if you're a Grand Theft Auto streamer, you probably have an RP server. You're probably monetizing that RP server. things that you guys probably don't even think about and you're like, "Oh, like I know he streams on this like Grand Theft Auto game." Like you wouldn't even think that like, "Oh, people are paying to be in this server."

And so things like that, like these kids have figured out like even the first gamer that I represented had a really large Minecraft server and it was like a PvP server in Java. It was pay to win and made it pay to win.

It was pay to win. It It was like not ULA compliant. I don't know if Minecraft's going to care anymore. uh [laughter] but like wasn't ULA compliant and it just printed money

and you know he would use his YouTube channel as the catalyst to drive people into that and that that server was the the real way that he would make money.

Yeah, that's interesting. So,

uh, do do you have an internal philosophy on how you talk to creators through like where they should draw the line on their comfortable because like pay to win Minecraft that feels like gambling adjacent. But at the same time, you know, like we talk to entrepreneurs all the time and they're like, "Yeah, my first first way I made money was like doing some crazy stuff on on uh Minecraft." And I'm like, "Is that really that bad?" And then you look at some of the crazier stuff and it's like obviously like a rug pulling a coin on your audience is like the worst thing you can do. But how do you think about like the gray area in between coaching creators, giving them like just hitting them with a ton of anecdotes?

It's become so much harder. Like there there's

I mean you can now just you can buy CS skins and now you're playing Counterstrike and you're like incentivizing kids to buy crates. There's just

we we've kind of taken the line of like if we understand that gambling exists and daily fantasy football is fine. Some of our creators have stake deals that will live stream on kick. And so it's just like where do you draw the line? Like I'm having a hard time with that right now because gambling is so widely accessible in so many different genres. Uh including video games which I think like even NCAA football that's gambling. Like they have packets that you open uh within their game mode and you just like spin packs and try and get players. So it's like every video game now has some type of gambling baked into it. And so it's it's hard for someone who like came into this industry that like didn't want to be in the the gambling world. Every single video game,

including like maybe a Roblox, like there's like things that you can buy where it's more like pay to- winesque. Um, and so it's it's tough. Like I I think that it's not something I wanted to get involved in, but now it's like we sit so deeply in the internet and in gaming um that it's just like become of like a part of every creator's business.

Yeah. Yeah. It's it's fascinating. I mean, I played Counterstrike 1.3, 1.5, like before it got productized at all. And it's hard to think back because I was talking to uh one of our buddies, Sager and Jetty over at Breaking Points, and he was kind of chastising me for being pro video game, and I was talking about my experience with Counter-Strike. Uh but it was a very different game then than it is now. And so, yeah, where where you draw those lines,

but it's still like it's a $5 billion economy. just just Counter-Strike skins, weapon skins, knives. It's a five billion dollar economy. And so that that would to me will just continue when if GTA 6 ever comes out. Um, you know, there's going to be a lot of people with RP servers and there's going to be pay to- win mechanisms. There's going to be rank mechanisms that kids are paying for. So, I I don't know that that's like a big that's a tough one for me.

Yeah. I wonder if uh yeah, I wonder I wonder where this will actually meet like where the rubber will meet the road because you could imagine some level of uh regulation around um you know can you target a something that is gambling legally to kids like maybe that you know if there's this type of advertisement in it it goes over into this pool of the algorithm that's maybe 18 plus um I'm not sure it'll it'll it's obviously something that like America is publicly discussing right now, but uh it's tricky.

Have you Are you guys using Sora at all?

Sora?

Yeah.

Uh no, not really. Okay. Not not on it. Like

No, I'm I'm on it. I I I made my cameo like available. Anyone can do one with

You do. Okay. So people can make videos.

Yeah. Yeah. I was like, "Yeah, go only." Absolutely. Jack

Oh, yeah. Yeah. I put I put in always depict me as a bodybuilder. So it's really funny.

Is there a lot of videos on Sora? Like are people actually doing it? not my community has not certainly not moved over and uh and the retention on uh the I think on both the viewing certainly on the scrolling uh we've been polling everyone in the studio hey what's your screen time on Sora this week what's your screen time on Sora because we want to know are people actually uh getting into this as like a consumption tool we haven't seen any of that now I do see occasionally there'll be a new clearly a Sora video that's been integrated into vertical short form in one way or another I found a funny guy who makes like tech comedy and at the end he puts a little Sora clip just to kind of like add a little spice on top and it's funny but I haven't seen a lot of stuff that's been like really breaking out.

I mean at the at the current moment I I don't

if if you just like base it on momentum it feels like it's lost.

It does feel [laughter] like it does feel like it's falling off.

But I mean there's hilarious videos on there.

Pull this pull this video is he fully jacked.

Wait, did somebody make one of me? Are you laughing?

Yeah. Can you guys pull it up? I'm I'm going to I'm going to go home and I'm going to have like a Discord server just make thousands of videos of you and just flood the Soros system and it'll just be your videos all over the place.

Yeah. Uh yeah. I mean, I don't know. It might be like uncanny valley thing. We we do use VO3 a decent amount for uh for like previs on like, hey, we want to shoot this video. What if it looked like this? Let me get some ideas for like lighting and tone so I can send it to somebody. This is what we think we're doing. But we always shoot everything normally. And we have it, we actually have a benchmark where we have something that we shot uh manually like we shot the normal way and then we try and recreate it in all the video uh the AI video uh systems and it's remarkable how hard it is even when you have a perfect idea uh this [laughter] watch.

Why am I walking a pig?

And the caption is what too many ramp ad reads does to an MF. [laughter]

They they figured out how to make my legs small. They hacked me. They hacked me.

Wait, aren't those your real legs?

Those are not my real legs. I did not scare my Wait.

Real arms and real legs.

What is the nature of the pig? [laughter]

Why do I have a pig? That's This is hilarious. It does. It does look like me in the face.

Gym shark.

Gym shark. Gym shark.

Gym shark stringer. [laughter]

Oh wow.

Yeah. I I don't know. It feels like it's lost a lot of its momentum. uh I I'm I'm not convinced like people are going to go on there and and watch content.

So my my core thesis for uh most of the AI generation apps like Midjourney, Sora are that they are more like video games than than consumption mechanisms. And so you go on there and you have an idea and you are trying to express it. Uh and once you get it to generate it, you watch it and you watch it just for you and then you're like, "Yeah, awesome." Yeah.

And maybe you said it to like one other person, but you really aren't, it really isn't just sit there and just a random person makes something and I enjoy it. It's more of the experience of like, can I get it to generate the thing that I have in my mind? Whether that's pseudo or midjourney. Somebody described midjourney as like art therapy. People like going on midjourney and just and just whatever they dreamt of last night, they'll prompt. And the images, they look just like any other midjourney images. There's no value to you, but to the person that generated them, they enjoy it. And so they pay for the content that they produce themselves.

Yeah.

How do you think uh there's a dynamic in the future? I think we're pretty far away from this point from a just model progress standpoint, but right now YouTube doesn't make any videos themselves. Why are you smiling?

I just need to go edit my Sora prompt to say never depict me with skinny small.

No, I'm taking advantage of that Sora later. You're going to see all kinds of videos. No, but so right now any any video that YouTube surfaces, let's say, um is uh they're paying out like a fixed basically revenue share on that.

And there's a world in the future where YouTube knows exactly the kind of video that someone likes. So like at night I watch like documentary style videos, right? So it's like, okay, Jordy likes World War II like uh voice over documentary style videos. Uh we could just serve we could serve them a video of an existing creator or we could just serve Jordy a video uh same topic but it we created it ourselves so there's like some cost to like generate the asset and serve it but

theoretically a lot less like do you like

I think that uh that scenario creators are going to be creators that are worried about AI today are not worried about the right thing necessarily. They're worried about like I don't I don't know, but I I think that's like a very real possibility.

They're overestimating how much they can get destroyed in a year and underestimating how much they can get destroyed in a decade.

Do you But does YouTube, who has been predominantly very creator first, pivot to that where they're now like making content through generative AI that is ripping off let's say a documentary storyteller or true crime? Like did it just feels like if they start they would they would do that if the number if like watch time continued to go up like that that like

I they're they're a massive public company.

They have an incentive to like increase profits.

Yeah.

100% of the

Yeah. I'm just saying like it sounds great in theory that they're like okay they're very creator aligned and they've made a bunch of good decisions to date. But

yeah,

I mean just that Sora that that Sora that we just watched like that was generated by someone who prompted it, someone with a sense of humor obviously, uh it it doesn't seem that crazy to me to actually figure out how to parcel out the ad dollars. Like if that video generates a $100 of ad revenue because people watched it and then they immediately watched an ad before or after whatever and it's attributable. Uh you could give me a slice because of my likeness. You could give the the prompter a slice. You could give Jym Shark a slice since their logo is in there. You you could give whoever created the music

should pay for that.

Yeah. Uh and and so uh if we have AI that's good enough at generating that, we should also have AI that's good enough to say, "Hey, this is a mashup between these two artists. Let's split the revenue share 50/50." YouTube already does this. If you put one song in, it'll route the uh I I I actually made a video about Mr. Beast once. I used some footage and and it got routed to his team. Probably you you got the check. Sorry about that. Yeah, it's all [laughter]

never you're never seeing that voice. It was uh yeah it like you know so there's like fair use discussions but in general it's pretty easy for a system to understand okay this is a combination of of this footage from here this music from there that IP over here they took Donald Duck off the shelf over there some Mickey Mouse some Batman some Spider-Man and they're all from different IP owners but let's just flow all the money through and then yes if you're coming out with something completely new then you don't need to pay as much and maybe you minimize that but this all just feels like it'll happen just over decades so I don't Yeah, I mean, uh, music's kind of figured this out where, you know, you have writers, producers, like there's so many different people on a track that gets divvied out to. So, I could see that happening in the future.

Uh, I I hope we don't live in a world where YouTube is understanding like psychologically what type of videos I watch at 9:00 p.m. And so, they're feeding me

generative AI videos that like is taking away from a human, but like maybe that is a world that we live in 10 years from now. And

that's that's who you're competing against. you're ultimately competing against the system of YouTube who is making amazing videos and their their incentive is to own 100%.

A lot of the a lot of the AI investment thesis is around labor displacement which is like we have to you know these companies are like we have to invest in AI because like future spend in the economy instead of going to labor we'll go to these data centers effectively.

Yeah. I do wonder I do wonder about YouTube's positioning with creators because uh that sort of what you describe 9M serve you generative imagery

that that to be clear is like a very specific type of content that where I don't feel the creator matters as much right if it's like

yeah but what but what if it's like sports news or or just news in general like I would I would imagine you could pull they could pull that in real time and be talking about what's going on

what I mean is like that's already happening because there's going to be a a company out there that says, "Let's use every available AI tool. Let's be the AI native uh, you know, beast enterprises and let's have no one in front of the camera and spend zero dollars on cameras and spend a lot of money on Sora credits and V3 credits and let's start producing as much as possible and let's use YouTube as our distribution pathway." And maybe YouTube takes a stance. I don't know that they would. I think that those creators who are who are puppeteering all the AI slop will probably uh stick around enough, but I don't know. It's it's uh there might be a reckoning to the degree where uh where YouTube says, "Hey, we're detecting AI and we're putting it in a different tab or we're not allowing it on the platform." But I would be shocked if they do that. I'd be very shocked because you could use because there are so many creative ways to use AI. like we just watched that. It was genuinely funny because we had context. It was not just like, you know, trying to take a dime out of someone's pocket.

Yeah. I think I think it'll start with thumbnails. Like that'll be, you know, you'll get a AI generated thumbnail as soon as you upload your video. It'll it'll watch your video and explain like what it thinks the thumbnail should be and then title. Maybe titles is first, thumbnails is second. Where it goes from there, I'm I'm a little unsure. Um, but you guys need Neil Malabone on the show so you can ask him this directly.

Yeah. Yeah. Yeah. I mean, the title thing is like I've I've titled uh hundreds of YouTube videos. I hated doing that every single time. And so, and I never got to the scale where I had like, oh yes, like I have a title person who's like amazing on my staff. Uh and and like I would be displacing their job if I had a if I had a tool for this.

Well, it AB tests it now. So, there's title AB testing, thumbnail AB testing. Eventually, it probably just prompts you what they think you should title it, and then it'll AB test it on its own and figure out where it lands. So,

yeah. Yeah, that makes sense. Uh, anything else, Jordy?

Lots more on my mind, but over the place.

Can do it again soon.

Thanks for having me, guys.

Yeah,

super fun.

Awesome. Thanks so much for coming by.

Thanks, guys.

Yeah,

we'll close out the show and we will talk to you in just a minute.