Throughout the past year, we've witnessed the rapid rise of online video studios and multi-channel Youtube networks. Companies that were relatively unknown just a few years ago have become established as major video programming brands with thousands of network channel partners and billions of cumulative video views. Because these network models are new and rapidly evolving, many creators have questions regarding what exactly defines a YouTube network, why a creator should or should not join one, and how they make money both for the network and for the creator.
ReelSEO Interview with Steve Raymond of Big Frame
For this week's Creator's Tip video, I had the pleasure of speaking with Steve Raymond, CEO and co-founder of the YouTube network, Big Frame. I asked him to help us answer some of these questions by giving an inside look at what YouTube multi-channel networks are all about.
Thanks to Steve for taking the time!
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View The Full Video Transcript:
On this week’s creator video, we are going to talk with Steve Raymond CEO of Big Frame about YouTube networks, what they are, how they work and what you should know about them. That’s coming up.
Hey guys, my name is Tim Schmoyer and welcome to another Creators Tip video where every week we do our best for you guys who are making online video content and know how to make that stuff perform the best on the web and today we have a very special guest with us, Steve Raymond. A lot of you guys may know Big Frame is a YouTube network and they have a lot of great talent like Richard Guitar Man, Day Storm, What’s up El, Lamar Wilson, Tyler Oakley, and I know you guys got tons, like hundreds. How many people you have signed under your network?
We have about 170 channels on the network right now.
Awesome. There is a lot of confusion as you probably know around, especially around what are YouTube networks? What do they do? How do they work? Should I avoid them at all cost? Could you just tell us real briefly what is a YouTube network and maybe spell some of the myths of what they are not also?
Yeah, sure. I mean, I think YouTube originally created multiple channel networks because they created this partner program and it started working and they started to have to have tons of people to start to make a living on YouTube and not with something you like that you start to create responsibility to with giving they are an engineering company that they wanted to undertake the responsibility of what you would call talent management, customer service, making sure that their people get paid and they see the need of YouTube over time to grow from just a collection of random videos into a place that is programmed. And so multiple channel networks exist to be the place where creators of all different types basically have their point of contact. You can’t email or call YouTube and have someone pick up the phone and answer your questions.
How does YouTube network work now and how do you guys make money and creators make money? How does that whole system work?
At the simplest, YouTube content management system or CMS available to networks and channels assign their channel into our contact management system and then allows us to access a lot of data, reporting, and API’s that we can use to try to grow the business and the secondarily we become the primary person who collects revenue from ad sense and so the ad sense checks instead of getting bundled into one check, they send it to us and then we pay people out. In terms of making money, I bet there is lots of different business models out there in terms of MCN’s and so mostly though there is some of revenue sharing that comes out of the ad sense check, but for us that is really just a part of our business model and so different networks are experimenting with different things like offering a big CPM and take everything above that.
I understand that a lot of them offer a higher CPM than like what YouTube would offer as well and that is how you guys can make money and the creator can still make money, is that right?
Well, if you are offering a higher CPM than YouTube then you are basically losing money on your dealing with the channel and you are hoping that you can make it up by, you know in some other way.
So it is not like you guys are doing direct sales for the pre-roles or anything like that right?
So I have to talk about Big Frame in general, we do a lot of stuff in terms of making money. We do have a direct sales team; we do lots of brand deals on behalf of our talent. We do anywhere between one and five or six deals a week. Whether there is either integration or media or both that benefits the channels in our network. So we are affectively, if you take the ad sense and then the buyers and the buyers that are sales force are generating then we are pretty much doubling the revenue of our network. That doesn’t mean that everybody in our network makes twice as much because some people makes more than twice as much because they are easier to sale and some people are harder to sale and so in terms of making money in general, we are building a media company and so what that means is that we are hoping to create brands, and channels, and shows that we on as well and over time it is like a Viacom or a NBC, we should create profitable franchises over time.
What are the other incentives though that a network then offers to those people that would be for creators as well?
Speaking of Big Frame we are very invested in talent management and so channels have people they can call and email who are in the corner and who can welcome them. There is the YouTube stuff, where we coach people with what works with the YouTube product team so they are constantly feeding us information about what works and what doesn’t and how the platform is changing, so we are advising them on that. But as people’s careers grow, they’re often getting approached by other forms of media, television and things. So we provide some support where they can get some help on just thinking through that sort of stuff. And then
It’s like a lot of help, like consultation, partnering. It’s like hey let’s help you. Let’s give you guys the advice and wisdom that we have learned over the years to help you do better. Kind of like that, a one on one type thing?
Yeah, and so I kind of always break it down like we are trying to help you grow your audience or your personal brand and we are trying to help you make more money. Those are the 2 main things and how we do that there is a lot that goes into it.
When should a YouTuber or a creator on YouTube start considering like hey maybe I should join a network or maybe they should just say maybe I should just stay on my own right now. Is it like every YouTuber creating content would benefit from joining a network or is there sometime where you should just hey I should just stay on my own right now, how do you decide when to sign and when not to sign? You know, that whole thing, how do you know? Do you have any advice for people?
There has been the last two years basically, I mean two years ago there was probably 100 network channels and now there is probably 20,000 or more so it has grown huge. We have not been one of the networks that is just focused on short term that is just trying aggregate thousands and thousands of channels because our strategy is “there is no other network”.
Which I love by the way.
Do you think that people of rush to join the network because they think, well you know, Mr. Guitar Man is in the network, or some other big person is in the network so that must means that is a way to get to success. I think maybe a lot of people may have joined the network when they did not need to or have joined the network because they didn’t understand what was out there or what was available. If you really want to go for it and you really want to make a career out of YouTube then you probably should be in a network and that means you should have a pretty good idea that you have a road to making enough money to pay your rent and save money for a rainy day and do everything. In that situation I think that a network probably do make since because they are, I mean at least for people who are in Big Frame, we are going to be out there sort of working on your behalf and we are going to understand your goals and we are going to be trying to make it happen. It’s a personal decision; I think it is something where you should really do the math on it. But you don’t need to be in a network.
Well, what if someone comes to that place in their career and they feel that I think that I could benefit from production help, from one on one advice, from more money, all that kind of stuff, what kind of questions should they be asking of different networks either when they are being approached or when they are approaching? What kinds of questions should they be asking when trying to figure out which direction they should be going in to go with this?
Well, I mean yeah, I think it is what is your strategy for my channel? And how much access am I going to get to whatever your secret sauce is?
So it is kind of what is my vision and where am I going? And looking at what the network has to offer. Saying these guys look up most clearly with where I am going?
Yeah, yeah. I mean I think if you want to do stuff in gaming you want to probably or definitely have a conversation with Ms. Shinama because they are very clearly good at that and they are learning more and more every month. So if you have a channel that is big enough and sort of brand friendly then you want to do a lot of brand integration deals then Big Frame is probably the best at that because that’s where our focus is and then we are starting to invest in verticals.
Can you explain what a vertical is real quick for people who might not know?
Yeah, and so getting back to the first question, what is a network and why did YouTube create them? If you think about what happened to cable TV in 1983, I am old enough to remember, maybe most YouTubers aren’t but there were 4 channels and then it went to 50 and then all of a sudden there were people saying there will never be a 24 hour sports station, or there will never be a 24 hour news station or you can’t make a whole channel around travel. Then that all changed and new brands emerged and those are more or less verticals, MTV, BET, ESPN, those are programming that are network played and so we are investing in trying to understand what is a network play that is verticalized look like on YouTube? How does one succeed? And how do you really create this network affect were by being in the network you are getting programmed and more people are finding out about your content and more people are discovering it and they are getting more value out of subscribing to you or subscribing to an overall network. So we think about our world as we need to create value for the talent of course but also for advertisers and for the end users by doing that through programming and so for instance we are rolling out our first vertical which is called Forefront, or you could go to forfront.com, or you could go to we are Forefront on YouTube and start to see what that is looking like. We are selecting channels that we think fit into a type of content that people are going to say hey, I come in here and watch 10 videos in a row instead of just jumping around YouTube.
Yeah, you guys do all the hard work, all the heavy lifting of curating. Like I go through my subscription feed on YouTube and I am subscribed to some 400 channels so I don’t watch every video that comes through, you know. It would be great if I knew someone that I trusted to say hear, you should watch this Tim. It would be awesome.
In less than 10% of viewers the view YouTube has any subscribers at all but we that people who come to YouTube everyday of the week or 7 days a week watching an hour of content a day, so they watch 7 hours a day, I mean a week. And there is people who only comes once a week watch 6 minutes. So the name of the game is to get people to say I am going to spend some time here and my experience isn’t just going to be watching a video coming out, it is going to be spending some program situation, and so because we are creating things like Forefront and we are working on a brand called Wonderlead that will be launching in the first quarter, it will start to become real evident to channel creators that they should work with us.
So what makes Big Frame distinct of all the other networks out there, who are you guys? What are you guys about? And we have talked a little bit about where you are going but tell us a little bit about what you makes you guys distinct from all the others.
Yeah, we were lucky, my partner and co-partner Sara has been working in this business a long time and she’s just excellent at talent management and describing the opportunity of YouTube at brands. And so when I met her, she had already done over 50 brand integration deals and so the people she were working with the kind of wanted to do those kinds of deals and brands wanted to do deals with them. So positioning has always been a premium positioning where it’s not content that is G-rated or even PG-rated, it is YouTube content but it’s content that I always say I can every channel on my network to my mom. I don’t know if any other networks would be able to go in that direction and so we started there and our focus has really been on how do we create value, very specifically to channels so we don’t sign channels that we don’t know what to do with and so we have learned that is not a long term relationship. We don’t deserve to be in business with people when all the value is just flowing to Big Frame because we are their channel and we are making money from them. The business won’t last and so I think kind of uniquely among the bigger network we are focused on a media company model were it is identifying channels that work within a network model that can be part of a program experience that starts to create audience development and marketing lift for the channels that are in it and the advertisers can come to it and we can very clearly describe this is why you would want to work with these creators because we got the products work for you ,we know how to give you either integrations or lower cost media or more effective campaign ideas, if you want people to land on your website or check out a particular product or just hear about a product we are going to the best at helping you sort of navigate YouTube.
I know you probably wouldn’t toot your own horn in this area, but I know several people who are partners with you guys and they are all happy and they love Big Frame and one of the things like the vibes I pick up from some of those people is that they feel like they are a part of something else, they are a part of Big Frame. It is not like, oh I gave my ad accounts to a studio and now they just give me checks and sometimes they are more than what I would have made and sometimes they are not. But it sounds like they feel that they are a part of something and none of them has really said that to me, that is just kind of the vibe I pick up and it’s like a community aspect and Big Frame so that is one of the reasons I wanted to talk to you. I was like man, they seem like they are doing something right over there, and so I hope you guys continue to excel and do great at what you are doing.
Thank you, that is very gratifying to hear.
Where can they check out more things about Big Frame? Just go to Bigfra.me right?
You can just Google Big Frame, we are the whole first page so you will find us there but we have and address that is called business@bigframe, if you go to forfrontTV.com you can check out that content and see what is right for you, there is a submission page there for channels.
Okay, so if someone is interested in like maybe partnering with you guys they can contact you from there and then you can start a conversation and then figure out if it makes sense for both parties or not.
We love to hear from talented people and even if we can’t work with you, we would love to have a relationship
Well everyone who watches our ReelSEO video are talented people, so that works out well. So if you guys have any other questions and you are watching this about network comment below and me and whoever else I can rope into more knowledgeable than me, maybe we will try to answer some of your questions there. Make sure you go check out forfronttv.com and Big Frame’s website and all the awesome stuff that they are doing. Steve thanks so much for hanging out with us and giving us a lot of your advice and wisdom and for clearing all of this stuff up, we appreciate it. And for the rest of you guys, make sure you subscribe. We do this type of stuff all the time, would love to hang out with you and we will see you guys again next week for another Creators Tip video.