Patreon Challenges Youtube With Content Monetization Platform

Now nearing its eighth year of operation, YouTube has established itself as the leading user-generated video content destination on the web. But despite its all-but-solidified top-dog status, recent reports indicate the company is now experiencing growing pains when it comes to serving the market space it largely helped develop and colonize.

The heart of the issue is the ongoing debate regarding how the site should be monetized for avid contributors, many of whom are limited as to the amount of revenue they can earn from creative projects that require substantial time and resources, even when they net millions of viewers through the popular web destination.

As a result, entrepreneurs like Jack Conte are wasting no time proposing, and launching, potential solutions while this question is still waiting to be solved.

On May 7, Patreon made its online debut with the mission of “empowering a new generation of content creators,” according to the website. The new web destination has already garnered a few high-profile media mentions for its creative acknowledgement of this market discrepancy.

In particular, founder Jack Conte, of the band Pomplamoose, whose monthly videos regularly attract more than 2 million visitors, spoke to All Things D about his latest venture, which he says is an alternative to the monthly subscription solution that YouTube has proposed.

“On YouTube, there are now tens of thousands of people with hundreds of thousands of followers each,” Conte said in an interview. “This is the burgeoning artistic middle class. It’s not a not a Bono or a Zach Braff, but micro-demi-celebrities. So, power and fame, instead of being in the hands of the few, is incredibly distributed.”

Conte stressed that the difference between Patreon and YouTube, while potentially benign to observers, is clear. Unlike YouTube’s paywall, which would mandate that every viewer first pay for content, his company’s model allows only those who want to contribute to support the artists they know and love, according to the report.

Further, Conte went on to highlight how Patreon differs from Kickstarter, which he sees as another competitor, saying in a video post that in contrast to the well-known crowdfunding service, which attempts to channel a lot of money to single projects, his site would allow creators to solicit small, more frequent tips of more than $1 for their work. Like Kickstarter, however, artists can set perks that those who donate can obtain for a certain contribution.

AdAge indicated that YouTube began to acknowledge its need for innovation on this point beginning in January – and the company is rumored to be launching its subscription service within the next few weeks, a May 6 press release suggests. This new offering is expected to allow users to access certain channels only after paying a fee of $1 to $5, and it’s launch may hamper Patreon’s expansion if it proves popular.

Whether Patreon and an in-house YouTube monetization platform can coexist remains to be seen, but it’s a proposition we may have an answer to soon.

To read more on Patreon, check out Conte’s full interview with All Things D here.