How YouTube’s New Arrangements With MCNs Work

Networks can take more responsibility for copyright violations

In the last week or so, YouTube has been reaching out to the various networks that operate businesses on the platform, implementing new procedures for how these companies handle copyright violations and contracts. Several new details have now emerged on those discussions.

Going forward, YouTube’s network partners (multi-channel networks, commonly referred to as MCNs) have two options when working with individual creators, per sources. The MCNs can either designate YouTube creators in their networks as “managed” partners or “affiliates.”

In the case of managed partners, MCNs will be responsible for any copyright violations these creators incur. The culpability of MCNs when it comes to copyright violations on YouTube has been an issue of late, ever since the MCN Fullscreen was sued by the National Music Publishers Association. It’s very common for YouTube creators to cover popular songs or include clips from TV shows and movies—and many creators are young and not exactly savvy when it comes to digital rights management.

Thus, YouTube is urging MCNs to take responsibility for its top talent. According to sources, MCNs will face a series of scaling penalties if their partners wrack up lots of violations—and individual channels or companies could face getting kicked off the platform.

However, in exchange, YouTube is promising that these so-called managed creators or channels will get paid more quickly—they will essentially be able to monetize their videos without YouTube having to review their content.

On the flip side, if MCNs designate some of their creator partners as affiliates, than these MCNs will not be responsible for any copyright violations, per sources. However, affiliates may face more scrutiny when it comes to monetization.

Plus, these affiliate creators will have somewhat looser ties to their MCN partners. As part of this arrangement, affiliate channels will have insight into current market CPMs for YouTube—in other words, what they could be making organically, without working with MCNs. In addition, affiliates will be able to click a link within YouTube’s interface to initiate a breakup with their MCN partner.

Clicking this link doesn’t automatically sever ties between MCNs and their affiliates. “Most times, we’re dealing with this stuff internally,” said an MCN exec. But it does initiate a "workflow" that could lead to a quicker, smoother breakup. And that process does bring YouTube into the loop on which MCNs are potentially losing which customers.

YouTube execs declined to comment., but the company has been adamant about its desire to nurture the MCN ecosystem (there are said to be several hundred YouTube nets). And YouTube will have no say in MCN/affiliate contracts.

MCNs won’t have long to implement these new designations. Per sources, MCNs need to decide which partners will become managed vs. affiliates by mid-November—and some MCNs have several thousand partners.

Still, there’s hardly been an outcry among MCNs. But as with any YouTube policy change, there is some trepidation. According to one MCN source, there is some concern that the new rules could lead to too much fluidity in the market. In particular, some worry that inexperienced YouTube creators may be quick to react to rapid CPM fluctuations and look to jump from MCN to MCN recklessly. It could lead to MCNs shrinking their ranks.

“This forces us to weigh risks in our network,” said an MCN insider. “It could be a bit of a catch-22. We hope it works well for everyone.”