Thursday — August 5, 2021

Wide Eyes News from the Tube (March 2020 Edition)

Wide Eyes News from the Tube is written by a leading industry expert and is focused on providing a quick snapshot of the best opportunities in the television & animation market.

  • Over the last decade whilst ABC Kids continued to own the pre-school space on Australian free to air TV, viewing of short form kids content on YouTube has been growing at an astonishing pace and making superstars out of properties like Baby Bus, Baby Shark, Chu Chu, CKN Toys, Cocomelon, Blippi, Bounce Patrol, Debbie Doo, Little Baby Bum, Ryan’s World and many others not far behind.
  • The two most popular genres of these short form videos on YouTube are musical nursery rhymes and unboxing videos including toy reviews.
  • In the nursery rhymes category, the YouTube algorithm rewards the most popular songs with additional automatic plays and penalises less popular original content by not automatically playing this content which has had the consequence of all the YouTube artists making endless versions of the same nursery rhymes such as Five Finger Family, Wheels on the Bus and Baby Shark.
  • The size of the global audience for these kids content videos is staggering – for example on the US site Cocomelon videos are viewed 100 million times a day with the total number of global views now over 50 billion – on the UK site Little Baby Bum nursery rhymes are viewed 20 million times a day with a total of 22 billion global views – on the Indian site Chu Chu videos are viewed 14 million times a day with a total of 20 billion global views and on the Australian Bounce Patrol site videos are viewed 10 million times a day with a total of 7 billion global views.
  • Up until January this year, YouTube had been playing targeted ads before each kids content video and had also inappropriately been collecting data on the kids audience watching the videos and selling that data to third party companies.
    In September last year YouTube was fined US $170 million by the US Federal Trade Commission for violating the Children’s Online Privacy Protection Act (COPPA) and as part of the settlement, YouTube agreed from January 2020 to stop targeting ads on all content that is made specifically for kids viewing.
  • The impact that this will have on the advertising revenue received by the owners of these kids content sites is expected to be very significant and most site owners are anticipating a reduction in their YouTube ad revenue of over 50%.
  • With the artists performing in these kids content videos facing a large decrease in their YouTube ad revenue and with the high cost of producing content for YouTube, since the September COPPA ruling many artists have been looking for new sources of revenue which include diversifying onto other digital platforms, live touring and merchandising.
  • Recently launched toy lines and merchandise programs for YouTube kids content artists include Baby Bus, Baby Shark, Blippi, Cocomelon, Little Baby Bum and Ryan’s World.
  • As the negative impact on YouTube ad revenue begins to bite on the YouTube kids content artists, there will be a very heavy focus on making more revenue from live touring and merchandise sales and if this is not successful then for many artists the cost of producing new YouTube content may outweigh the ad revenue return they receive from YouTube which may see a dramatic slowing down of new kids content being put up on YouTube.

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