Are you a YouTuber?
Do you need help with your YouTube contract?
If you are a YouTuber, you may have been approached by a YouTube Multi-Channel Network (MCN) to join their network.
YouTube network contracts are usually complicated because they involve networks getting a piece of your ad-revenue share for a duration of one or two years.
Only a good YouTube contract lawyer can ensure that you get the contract terms that you deserve.
► If you’re a YouTuber and you need help with your YouTube contract, email me Sam Mollaei Esq. YouTube lawyer at [email protected]
What is a YouTube MCN?
Multi-channel networks (MCNs) are organizations offers assistance in video production, management, funding, audience development, etc. that offer managing and overseeing several other channels that belong or are part of their network. This privilege allows them to monetize videos across their whole network of channels.
Think of YoUTube MCNs as a business that’s collecting many YouTube channels to be under their umbrella which brings all member YouTube channels under one major channel. IT’s important to know that MCN’s are businesses — they are created for the sake of making money… for themselves.
When there is a YouTube network, there is an opportunity to bring all of the creators together which brings more opportunities for all network members while at the same time benefiting the network’s business itself.
Remember that a YouTube Network needs you as YouTuber to join as a network — they can’t survive without you.
In simple terms, a multi-channel network is a type of organization that works with video platforms such as YouTube, to be able to give assistance in areas such as Product programming, funding, partner management, digital rights, and audience development.
In theory, MCNs collect and are responsible for representing talent to content creators that have popular YouTube channels, and package them for the advertisers in exchange for a slice of their income.
However, you should note that the offerings differ across different MCNs. Nonetheless, they can help content creators build and share their audiences, by providing them with access to production resources and even seek sponsors for the branded content opportunities.
These networks bring in the business opportunities for popular YouTubers by helping YouTubers expand their channel and influence in exchange for a cut of their income.
Originally the MCNs were smaller and very difficult to join. Only popular YouTube stars were accepted and benefited from the talent management, cross promotion and from the revenue that they generated through the merchandise, the product placement and the ads that were sold to the videos that were a rate higher than Google’s own.
Recently the MCNs have opened their doors to the smaller YouTubers offering a chance for anyone to make use of the services that they offer. Meaning that for the smaller accounts, their users can be able to make money from their videos easily especially if they are not already a YouTube Partner.
Thoroughly researching MCNs, negotiating the terms of contract, and having a Youtube lawyer review the MCN contracts before signing the agreement can ensure mutual benefits in addition to enhancing the partnership experience for both parties.
What Do YouTube MCNs Do?
YouTube MCNs basically do 3 things:
- Bring together talent, production under one roof
- Owing the content
- Distribution of content
This can be compared to what the multichannel networks are doing today, apart from the fact that the control of the distribution has become a lot for them.
If you are reading this post, you are probably looking for some answers, therefore, consider what this post states as essential advice for any particular artist or content producer that is interested in joining these networks.
The main purpose of this post is to assist artist by preventing them from getting screwed over by their contracts or entering a legally binding relationship without understanding the underlying implications. Simply placed, if you follow the following advice, it will mean a better deal for everybody.
What are the Benefits of Joining a YouTube MCN?
Being part of an MCN definitely has some benefits, including:
- Higher CPM – which means higher rate of pay for your ads on your channel
- They bring you more sponsorship opportunities
- They can help you manage and optimize your channel
Problems with YouTube MCN Contracts
Most issues arising between YouTube creators and multi-channel networks relate to contracts.
Besides the many possible benefits of partnering with MCNs such as higher CPM, easy access to editing and production facilities, access to traditional media, and the option of making money from copyrighted music videos, there are various controversies that have involved YouTube Networks.
For instance, Ray William Johnson criticized Maker Studio for putting him under pressure to sign a contract which gives the company a 40% share of all his channel’s AdSense revenue and 50% of his intellectual property rights as regards to his shows.
Ray stated in a statement that Maker used “thuggish tactics” to really pressure him into signing the contract, which was leveraging his AdSense account for YourFavoriteMartian’s intellectual property rights.
In line with the above content creator example, it’s crucial for content owners to involve a Youtube lawyer to help them read through every agreement and fine print that they have to sign.
Since MCNs are for profit businesses, YouTubers and channels should always seek legal advice form competent contract attorneys to help them guard their interests.
With access to the internet, anyone can upload a content video to YouTube and make money off it. But first, one has to become a YouTube Partner.
How YouTube MCN Contracts Work
Typically, an MCN will approach you to join their network with a contract that you will need to review and sign should you choose to be a part of the multi-channel network.
The value for the MCN is that they will get your views – they will add your view count to their overall view count which helps grow their MCN. This allows the network to get more branding opportunities. An MCN will have more opportunities to get more opportunities because they can package a bunch of YouTubers together and they can offer the deal to brands.
Again, MCN’s need YOU, the YouTuber. So make sure when you’re joining this network, they are offering a value equal to what they’re asking. Because in most cases, they are asking for a portion of your ad revenue. This is a big deal because most of the time this is where your source of revenue is! Why would MCNs deserve your portion of ad revenue?
Further, MCN will ask for a percentage of sale opportunities or branded sponsorships. You want to make sure that whatever they’re asking from you, MCNs are returning equal value or MORE.
What You Need to Know About an MCN Contract
The prospect of getting to work with a company and grow your specific video channel is an appealing aspect to many, however, when getting into these contracts you should be aware that not all the networks have your best interest at heart.
Before getting your hands dirty with MCNs, get some advice from a contract lawyer. Ensure that you are up to speed with the law and fully understand what you are getting yourself into. With the help of an attorney, you can be able to avoid getting trapped.
It’s all about the money
Let’s be wholly honest, the MCNs are in it for the money! You are only allocated 55% of your advertising revenue, this is because Google takes 45%, and the MCNs take a slice of your remaining 55% at times, this might be as high as 30%. Not so appealing right?
Therefore, before you get to sign any contract or agreement, go through the specifications with your lawyer, and ensure that you fully understand what the MCN is going to do for you in return for offering them a share of your money.
Do proper research
Networks may tell you things to impress you, ensure that you investigate the MCN that you want to consider joining. Make sure you have checked the Networks reputation online, there are often unhappy clients who have offered informative rants.
Do a thorough search and investigate if they have heard any run-ins with the law and specifically in relations to contracts and violations, the chances are that you might suffer the same fate in their hands.
Promises that are too good
In case, the network is not willing to put a particular promise in your contract, and then it’s very unlikely that they will own up to it. In case they claim that they will get you brand sponsorship and increase your potential revenue, they ensure that they quantify that in your contract. Never sign anything that doesn’t say, “We guarantee this, by then, if not, you can leave.”
3 Things You Should Do Before Joining a YouTube MCN
Before joining an MCN, you should should research the different types of networks out there.
One network may be willing to cater to your needs or one may be offering more incentives than the others.
Once you narrow down the list of networks that work for you, do a thorough research and investigation of the networks. It would be beneficial to look into areas such as run-ins with the law, previous contracts, or any contract violations etc. Their reputation and client reviews may also offer valuable insight into the networks.
Another approach is to ask for insight from fellow YouTubers who are already under the network. Do not limit yourself to just the main stars of the network but also get to know the other YouTubers as well.
This will help you develop a bigger picture of what the network is like. In any case, if you are unsure about committing to a network, ask for a trial before signing a contract. Investigating various networks will help you gauge which one works best for you.
1. Never offer an MCN your own money
Even though they take a slice of your advertising revenue, they should never ask you to send them money up front, in case they do, seek assistance from your lawyers or visit an attorney. Always be suspicious of any network that will ask you to pay for a photo or show reel.
2. Record everything
Another tip is to record everything in writing and renegotiate contract if needed. By recording everything in writing, you can clearly review all details and ask a music attorney for clarification if something is ambiguous.
Some issues that can be negotiated are higher cost per thousand impressions (CPMs), sponsorship opportunities, channel management, production equipment, etc. Review the pros and cons of having a network step in to fulfill certain needs.
If a network is unwilling to put a promise into the contract, they are most likely to maintain their end of the bargain. If you can renegotiate for the promise, be certain that the next draft of the contract has the network quantify and guarantee when and how they will deliver the promise.
Do not be intimidated by the networks into accepting the first draft of a contract. As a content creator, you have something that the networks need in order to make business. You have the power to negotiate for a better deal.
3. Have a YouTube Lawyer Review YouTube MCN Contract
Before signing the contract, have a YouTube lawyer review the details. Contracts usually come with complications. It is recommended that YouTubers create multiple drafts and have lawyers review it before signing to limit liability or other issues later on.
A lawyer can read between the lines and decipher the legal jargon that may cause ambiguities and confusion. They can clarify uncertainties surrounding duties or responsibilities.
They will also be able to assist you in arguing for a better contract agreement that matches your needs and also benefits you. A lawyer will work in your interest to make sure that the terms of contract are upheld and in the event that the contract is broken, they can also better represent you in court.
MCNs are business opportunities for YouTubers. It may seem like an arduous task in partnering with MCNs. However, if YouTubers carefully consider all options before signing a contract, it may establish a mutually beneficial relationship and business.
Lastly, you should note that the MCNs are purely after money. Makes sure that you are the one gaining the most out of your hard work, or else they might just maximize your efforts for their own benefit.
Why are MCNs Popular
It has been estimated that in each month, YouTube has been able to draw about a billion unique visitors who have the privilege of watching a combined sum of about 6 billion hours of video.
This massive user base that is about 40 percent of the world’s online population has been able to attract a new breed of company that we now call the Multichannel Network, the MCN.
The MCNs aggregate thousands of video channels and a massive community of content creators, who partner with YouTube to be able to syndicate and monetize their content while at the same time having the luxury of distributing videos on their own websites.
3 Reasons to Join a YouTube MCN
1. For Protection and Management of your Network
Many of the YouTubers don’t necessarily worry about the management of their digital rights of their content and sending emails to their specific partners.
A good thing the MCNs do is to offer support in these specific areas, and they are equipped with a team of experts that help control the behind the scene happenings of your channel. This is an important benefit to the content producer who most of the time want to focus on content creation rather than the cooperate aspects of the channel.
2. Cross-Channel Collaborations
One of the greatest benefits of joining an MCN on YouTube is the fact that there is potential for collaborations with other members of the network that you are in. Collaborations are a great way to build your subscriber count. This is because it gets more eyes on your content by reaching a whole new audience that your channel did not have before, expanding your viewership in the long run.
Most of these networks usually have a broad catalog of video makers and they often encourage them to work together for mutual benefit. This is something that your channel can take full advantage of.
While the MCNs are known to take a percentage of your ad revenue, they also assist in the boosting of your income in some different ways. When you join an MCN, it can help you get a higher CPM (Cost per thousand impressions) which they often claim is achievable due to brands and sponsorship, however, be very cautious about this fact, get your lawyer to see you through this.
3 Tips to Negotiating a Good YouTube MCN Contract
You may be wondering whether or not you need to join a YouTube multi-channel network.
There has been a rapid rise of online video studios and YouTube networks like Bigframe, Machinima, Fullscreen and a host of a lot more others that have newer options that creators can consider, however, the process of navigating this new world can be a bit overwhelming.
The prospect of working with a company to grow your channel and earn potentially more money is an appealing aspect to many creative producers, however, not all the networks around have your best interest at heart.
Getting an email from a YouTube multi-channel network may seem like a flattering and exciting gesture, but you need to be careful when signing up with these channels. The following are important tips that can assist you during an MCN contract
Tip #1: You own the content so you have the power
Let’s get one thing straight, you own the content. Therefore, it has proven itself to the extent that you have built an audience and have some considerable audience, or just simply making some good work, and that’s exactly what the MCNs need. Their entire business model greatly relies on a creative like you to supply them with content so that they can thrive, generating viewership.
When the channel lacks views, then it means there will be no money, meaning no business. Therefore, your content in simple terms represents a business opportunity that they so desperately need. Therefore, when getting into a relationship with the MCNs, you will need to relate to it as a business.
So here’s the tip, never agree to get into a relationship with an MCN where they are passively siphoning off your income if they are not improving your prospects beyond what you had before you got into this relationship with them. Make sure that you weigh what you are giving against what you are getting, make sure that it is fair.
How will you know what is fair? There are no rules here, and what might be fair to you, might not be fair for another, seek legal advice from your attorney to make sure that you are getting the best deal out of your contract with the MCN.
Tip #2: Lawyer up before you sign any contract
Never sign the first draft of the contract that is sent to you by the network. When you first get the contract, that’s the beginning of the negotiation. You have every right in the world to have the things that you don’t like changed. You can communicate the changes by altering the contract and sending it back to the network.
Some of the contracts that are sent over by the MCNs are frankly absurd and should not be signed under any circumstances. The thing is, these companies have a legal team and lawyers on retainer, and they are paid to ensure the network gets the best deal possible, so unless you are a qualified YouTube lawyer, you are not qualified to beat these guys yet.
Therefore, you will need to get a hold of an entertainment Lawyer, pay them, and let them review your contract point by point with you to ensure that you understand what is going on.
Tip #3: Time moves fast online
Two-year contract? That a lifetime, this is the internet, time moves first. In Simple terms, a lot can happen in two years. Therefore as a starting point you should look at the contract term that lasts from six months to a year depending on the deal that you are getting with the network.
You should know that one reason the networks ask for a long term is so that they can reasonably sell you to their advertisers throughout the year, therefore, whatever you sign should take you out through the year.
In this kind of situation, make sure you go through the contract with your attorney to determine the contract length with the network, and if the length will be beneficial to your needs.
Why Have a YouTube MCN Contract Reviewed?
However, with contracts comes complications and this stays true even for people like Grace Helbig. Rob Barnett, the CEO of an MCN called My Damn Channel, discovered Helbig through her vlogs on YouTube.
They partnered with her and as a result the DailyGrace YouTube channel was formed in 2010. In 2013, Social Blade showed that the DailyGrace channel had 3 million subs, about 200 million video views and more than $725,000 in annual earnings.
It is not clear whether Helbig got a lawyer to read her contract with My Damn Channel before she signed it. What is clear is that after five years with MDC, the YouTube star chose to leave the network in December 2013. Her contract with the network had expired and she decided not to renew it.
The split seemed amicable until the company announced that it would keep the DailyGrace channel active and post old videos that never made it to YouTube. It soon became clear to subscribers that Helbig was forced to forfeit the DailyGrace brand and all the content she had posted on the DailyGrace YouTube channel when she left MDC. That means she was no longer able to benefit from the proceeds brought in by the content she had created while she was working with MDC.
To avoid such a situation, you should always involve a trusted contract attorney to carefully read the contract you are about to sign with a Multi-Channel Network.
Why a Contract Review of MCN YouTube Contract is Important
You want to make sure the terms of your interests are in the MCN contract. You want it in writing in the contract. If you do have a contract, you need it read by a YouTube lawyer who will review the contract for you that will have your best interests in mind. You should always have a lawyer review the MCN contract before you sign the contract to make sure it matches your needs.
In reviewing the contract, the MCN contract lawyer will make certain you understand the stated obligations under the contract. If there are any uncertainty as to the duties under the contract, he will clarify that for you.
Why YouTube Networks Approach YouTubers
YouTube networks are usually drawn to successful YouTubers for their own interest.
Once a network has signed a contract with a YouTuber, they offer him or her assistance in areas like higher CPM, bonuses, sponsorship opportunities and channel management and optimization in exchange for a percentage of the ad-revenue of your channel.
To ensure that YouTube networks keep this monetary source secure for a given time (typically for one or two years), networks will first ask you to sign a contract with them.
What are the Benefits of Joining a YouTube Network?
Joining a YouTube Network has some benefits, including:
- Higher CPM – some networks will offer to raise the rates in which you get paid per thousand views. Sometimes it’s a range and sometimes it’s a flat rate.
- Bonuses – in some cases, networks will offer an upfront bonus to you, usually in the form of money, to sign with their network.
- Sponsorship Opportunities – most networks will offer to bring you brand sponsorship and campaign opportunities.
- Channel Management – sometimes, networks will offer to help with the management of your channel. This can be in the form of managing the business of your channel or helping directly with channel management.
- Channel Optimization – networks will offer tools to optimize your channel to receive more views and reach more people.
Often, the amount of these benefits is determined by your subscriber level and your average view count.
Should You or Should You Not Join a YouTube Network?
I have been asked this question many times, but each time the answer is, “it depends.”
Ultimately, the most important question will be, “Will you benefit more by joining a YouTube network than not joining?”
If the answer is “yes” then you should join the network. If not, then you should not.
That sounds simple, right?
Well… it’s not as simple as it sounds.
How do you really know if you’re going to benefit more from joining a YouTube network than not?
Generally, all YouTubers have high value that you don’t ever realize. A YouTuber can create content that can rival that of traditional media at a fraction of the budget and equipment.
What makes you even more valuable and unique is that you carry a dedicated audience. When Hollywood makes a movie, there is no guarantee how many people might watch it.
However, as a YouTuber, you have a loyal fanbase in the form of your subscribers who actually want to watch your videos as soon as you upload it to your channel!
What’s even more amazing is that if you have great personality, a skill, or something of value to offer to your viewers, you will become successful… regardless of what YouTube network will or will not do for you.
That’s why it’s really important to weight your options and decide whether joining a YouTube network will benefit you more by joining or not joining.
That’s why it’s absolutely necessary to have a YouTube contract lawyer review your YouTube contract to make sure you get the most out of joining a YouTube network.
Why You Need a YouTube Lawyer on Your Side
Most YouTubers are not familiar with YouTube contracts… or contracts in general.
A YouTube contract lawyer is skilled in all matters involving YouTube contracts and contract law. Further, a contract lawyer is trained to read in between the lines of contracts and demand that terms that favor their client to be included in the contract.
You want to make sure the terms of your best interests are in your YouTube contract. And you want this to be in writing in the contract.
You should always have a contract lawyer review the YouTube contract before you sign the contract to make sure it matches your needs.
YouTube Networks are businesses and they are only interested in bringing business opportunities for themselves.
That’s why it’s necessary to have a YouTube contract lawyer on YOUR side to make sure you receive better terms and ensure the contract terms also benefit YOU, the YouTuber.
Need to Talk to a YouTube Lawyer?
As a YouTube lawyer, I help YouTubers with the contracts.
If you’re a YouTuber, email me at [email protected] to get help with your YouTube contract.