Patreon launched in 2013 and estimates $1 billion in total payments to creators by the end of 2019. That averages out to $166M/year. Google reported $30 billion in ad revenue for Q1 2019, that's 6 years of Patreon transaction activity compressed into 3 days (or their entire 2019 activity of $500M in payments in less than 2 days).
Can you still extrapolate from this that the tipping model is even anywhere near a threat to Google's ad based business model that they should be incorporating it? And is it even an apples to apples comparison? Many creators don't use Patreon in spite of or to replace ads, they use it as a supplement.
Moreover, just because something is technically simple to integrate, doesn't automatically make it the correct business decision to do so.
First of all, I guarantee a native Youtube donation/subscription/tipping service would already have far more users than Patreon even does currently (see twitch.tv for a great model) due the enormous network effect Youtube already has. Second of all, $1 billion and growing rapidly for a third party service. Nearly every quality Youtube channel I am subscribed to has a patreon at this point, and I can only imagine it increasing as a percentage of income the content creator generates.
> Can you still extrapolate from this that the tipping model is even anywhere near a threat to Google's ad based business model that they should be incorporating it?
No, but we can extrapolate from twitch, and guess that it probably would be.
> Many creators don't use Patreon in spite of or to replace ads, they use it as a supplement.
Because it is a third party site, there is no such option. It would be trivial to incorporate an ad-free experience for donations/subscriptions similar to how twitch does.
>> native Youtube donation/subscription/tipping service
This exists, already competes with Twitch, and is part of an even bigger portfolio of media services from Google. You're arguing for Google to do something they have been doing for years.
Well I use YT nearly every day and didn't know you could become a member of a channel or what the benefits are. Guess it is just poorly marketed. My bad!
Youtube is their content business division and already has tipping, superchat, subscriptions, ecommerce and premium channels. It also has ads and is highly profitable.
You're vastly overestimating what people will actually pay for and underestimating how big and critical the ads industry is.
Then they should just buy Patreon like they bought YouTube. Why risk failure if that’s actually a good hedge? A: It probably isn’t a good hedge because they know Patreon can’t even remotely scale to the size of the AdWords business. People just generally don’t want to pay much for content. Better would be leveraging subscriptions and then developing a money distribution process to support the content people will come for. I think they are trying with YouTube TV and Red.
