Communication across the world has evolved due to advancements in technology, resulting in a convergence of media which is opening up wider avenues for the world. In simple terms, the convergence of media refers to the merging of different types of mass media including the traditional media, print media, broadcast media, new media backed by the internet, and portable and highly interactive technologies through the digital media platforms.
Tech advancements transforming the media market
Widespread usage of smartphones is the most relevant example of media convergence. It is the one device that blends together various media such as print in the form of e-books, online news, broadcast in the form of radio, streaming platforms, and social media in the form of applications providing space for information dissemination and constructive debates. As a result of this convergence, the 3Cs, i.e. Communication, Computing, and Content integrated through technology are enhancing the reach of media messages and giving consumers the liberty to interact through the media at their own convenience, which was missing in the traditional media.
This has changed the media dynamics completely and also made sure it’s no longer a monopoly of the public sector but has paved the way for independent media platforms and privately generated content (through Youtube and other means). While the mainstream media market is still an oligopolistic one, the advent of the internet and the popularization of social media, specifically YouTube and Instagram has made the media space and content market a near-free market where consumers are also content creators and the cost for producing it has gone down sharply over the years. These trends are the basis for the changing economics of social media that is also driving self-employment. For many people, content creation on YouTube starts as a hobby or a supplementing source of income (after reaching a particular benchmark for monetization) and eventually ends up becoming the main source of income.
Diversification of media markets has changed the business models
While YouTube primarily is a place for creating videos and sharing them with a wider (diverse) audience, there is a lot more to it. For many people, content creation on YouTube starts as a hobby or a supplementing source of income (after reaching a particular benchmark for monetization), and eventually ends up becoming the main source of income. The economics of YouTube is an interesting area of study. Apart from the video-sharing facility, the platform also offers tools to the eligible creators (select creators whose content is at par with the monetization policies) so they can earn money in a variety of other ways including merchandise, channel membership, SuperChat etc. The major part of the YouTube revenue model is the advertising revenue and the remaining comes from their monthly subscription business (YouTube Premium).
Likewise, Instagram, Facebook, and other social media platforms too are increasingly relying on the ad model of revenue by boosting small creators’ posts by making ad policies and pricing flexible and nominal and enabling more creators to join the network to spread the word about their businesses or products and services. The percentage of revenue from ads as a ratio of total revenue is 85% as per estimates This not only generates brand value for upcoming creators but also provides a win-win for both creators and collaborating brands.
Social Media and Self-Employment : The Economics of the Creators’ Market
The existence of such a vibrant digital space with growing usage of technology and the growing scale of marketing through social media applications is not only changing the media markets and business models of organizations that provide such platforms but also has changed the way self-employment is being perceived by the e
mergence of ‘influencers’ market which is primarily driven by content published by common people with little to significant experience in handling media set up. The framework generated as enunciated earlier shows that content drives the market for the creators which in turn generates opportunities for increasing their incomes by multiple branding opportunities. This is evident from the fact that in India the youtube creator revenue growth has gone up by 100% in 2020; With nearly 1200 creators having more than a million subscribers and 265 million-plus monthly active users and nearly 2500 channels crossing 1000 subscriber market daily, the value of such a market is phenomenal in size. Estimates have put it at 2,200 Crore and annual income for an average channel that crosses 1000 views, is estimated to be INR 7.3 Lakhs which is equivalent to money earned by those working in tech giants such as TCS or otherwise. What this thus provides is not just yet another source of income but is becoming a profession in itself yielding great dividends for passionate Youtubers and other professionals. This, therefore, proves that there are alternative means of self-financing and self-employment which are adding value to what is otherwise called as ‘gig economy’ and the key to all this becomes the content that is generated by the creators and accepted and encouraged by viewers.
The article is authored by Lavpreet Kaur and Pavan Thimmavajjala
Pavan Kumar T has been a regular author at Econfinity and has graduated with a MA in Economics from University of Hyderabad and is a researcher and a PhD aspirant.