(Bloomberg) -- Amazon.com Inc.’s Twitch and Alphabet Inc.’s YouTube are phasing out big-money content deals with top livestreaming gamers after years of making seven- and eight-figure offers.
Twitch Chief Executive Officer Dan Clancy said in an interview with Bloomberg News at the TwitchCon conference in Las Vegas that the strategy had “created this bidding war, and I don't think that's a sustainable business.”
YouTube is also backing away from such deals, according to two people with knowledge of the company’s strategy who asked not to be identified. The video site is decreasing the size of deals with top gaming livestreamers and trimming the length of contracts it offers. The company didn’t respond to a request for comment.
For more than three years, YouTube and Twitch have competed for top gaming talent to bolster their livestreaming services. The platforms calculated that paying up to stream live play by popular video-game personalities, or influencers, would bring in hundreds of thousands or millions of fans, increasing advertising revenue. In 2019, Microsoft Corp. briefly waded in to sign gaming celebrity Tyler “Ninja” Blevins and others to its now-defunct Mixer site. He later returned to Twitch.
Now the platforms are changing.
Twitch stopped requiring exclusivity in its contracts with top, or “partnered,” streamers in 2022, Bloomberg reported at the time. At TwitchCon, the company announced that streamers can now simultaneously broadcast on any other platform, including YouTube, ByteDance Ltd.’s TikTok or Meta Platforms Inc.’s Instagram.
Previously, Twitch sought to match other platforms, Clancy said. While there are still streamers with custom deals at the company, Clancy said he is “reducing that significantly.” The company is moving toward standard terms with the exception of a very small contingent of talent.
Several streamers saw their live audiences shrink after switching to YouTube from Twitch. Some have returned to Twitch from other platforms. Although YouTube is bigger, Twitch is widely viewed as the leader in live streaming of gamers, having pioneered the culture starting with its predecessor, Justin.tv, which launched in 2007.
In 2018, Twitch paid a reported $90 million to Activision Blizzard Inc. to stream its Overwatch League esports exclusively for two years. Viewership dwindled after YouTube took over those rights when Twitch’s contract ended.
Kick, a niche streaming service owned by the operator of a crypto gambling firm, has reportedly offered large deals for nonexclusive streaming rights. In June, the New York Times reported that Twitch celebrity Felix “xQc” Lengyel signed a $100 million deal with Kick, where he streams gaming and gambling content.
While “big signings make for splashy headlines,” Kick said it also has signed 133 “small to midsize” creators.
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