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Content platforms and creators in Argentina:
analysis of the value chain and production and monetization modalities
Addressing the Creator’s Economy phenomenon, in which an increasing number of individuals and companies are using online platforms to monetize their creative content and services, has so far been approached largely on a global or case-by-case basis. This paper aims at analyzing the dynamics and features of this new Argentine ecosystem, where there are 36 million social media users who spend an average of 3 hours and 22 minutes per day on social media. Based on an analysis of the value chain, platform governance, production, and monetization modalities, and by exploring certain outstanding verticals (gaming, eSports, music, and digital art), this document attempts to map the stylized facts, barriers, and challenges of this new sector, which may be shared by other non-central and developing countries. It also highlights some local characteristics that strongly influence the strategies, incentives, and behavior of actors, such as the relatively lower “click value” driving the need to scale innovation across borders. It also underlines the relatively lower availability of monetization options and the dependence on their specialization as a key challenge.
7.87 MG | 87 pages | PDF
Infographics
Chapters
Value chain
The first step was to identify the links of the value chain, describing the stylized way in which players making up the political economy of the ecosystem based on entertainment via streaming are productively related. The players reviewed are: audiences, creators, brands, aggregators, facilitators and platforms. Each of them is described on a more abstract and global level and they are characterized, if possible, according to the availability of information, on a level of functional dynamics and peculiarities of the Argentine case.
Platforms: monetization and terms and conditions
The next step was to describe a central aspect of platform governance: the terms and conditions regulating the traffic of contents designed by creators, as they affect their dynamics of creation and socialization. The general features of platforms are described in different comparative matrixes and tables. In particular, we focus on the monetization methods available in each platform, as well as the moderation filters for inappropriate content, looking into the dynamics generated around the so called “demonetization” filters.
Content development modalities
The third step was to stylize the dynamics and strategies identified in the previous stages. Two opposing (but not incompatible) stylized strategies were identified, which any creator may pursue: focusing on creators’ personalities or on the intellectual property value of the product generated. Based on this, an original matrix is presented, which makes it possible to map, at the same time, the main factors affecting the way creators may produce, distribute and monetize their contents.
Verticals
Finally, we explore four specific verticals that have quite diverse and, in some cases, more incipient dynamics: online games and sports (from now on, gaming and eSports), non-fungible tokens (from now on, NFT), and music. The analyses are presented in the form of exploratory, non-exhaustive case analysis, which does not allow us to systematize them in a comparative analysis following a consolidated comparative matrix.
Conclusions
Common trends observed in this incipient creative economy on a general level:
Consistency, volume and professionalism.
For creators, there are no possibilities to be seen and amplified by big audiences without some consistent presence in social media. A continuous production according to the parameters of each platform is a necessary (but not sufficient) condition for algorithms to expose creators to be seen by more users.
Professionalization creates direct and indirect value, besides employment.
Creators who begin to be successful become entrepreneurship founders and create teams that assemble original conceptualizations and tools around their art. By growing in scale, the focus on personality is less sustainable, and true and sophisticated organizations are required, as well as other types of support from other actors (distributors, aggregators, teams, communities) to be more massive, become multi-channels and join gaming leagues or communities, to name some options.
Platforms are just a means to access and amplify their reach, but hardly sustainable as the only monetization method.
There are relatively few exclusive creators in a platform. Most of them are present in several, with varying degrees of success, although they tend to specialize in one and replicate content in the others. After some level of knowledge by the public, many seek to take their social media followers to their own web pages with marketplaces, and they develop related products (books, merchandising, paid presence or events) on their own or in agreement with brands, which allows them to escalate their income schemes and volume. This, which comes natural for the “analogue” creators who reached social networks when they were already famous, starts to be also vital for the most successful “digital” creators, who were born and became famous thanks to social media.
Limited interoperability, learning by doing, volatility and vulnerability of the business.
Creations and success mechanisms in one platform do not necessarily work in another. Most creators usually learn to understand the algorithmic operation of each one and the differences of terms and conditions, especially how demonetization filters work based on experience, trial and error. Changes in the terms and conditions may leave out of the market different creations or production modalities, and there is little to be done about it as long as freedom of expression is not infringed. The digital business is volatile and vulnerable. There are “coaches” and agents or guides, and even communities and other support platforms that give advice that are growing, but they are not massive yet.
A few creators strongly attract audiences’ attention and income, while the rest is part of the “long tail”.
Different studies of the most successful creators show that a big part of them, about 1-2% of the most successful ones, often concentrate 90% of the audience and monetization. The rest, 98%, compete for 10% of the audience and an even smaller percentage of revenue. Platforms have made it easier to access monetization, expanding the “base of the pyramid”, but they have not changed the dynamics offered by the cultural industries in general, sports, and other professions where there are huge income asymmetries between the most successful people and the rest.
Apart from the rules set by platforms, creators have some room for maneuver and capacity for action to socially own their creation.
We identify four factors that affect these paths for the development of channels and brands, creating a (quite limited) spectrum of stylized options in terms of strategies for the production and monetization of content channels in streaming platforms: a) their strategies for the development of brand and audience: focus on personal brand or on digital products and sub-brands; b) their preferred formats in terms of contents: for example, short video or long video, ephemeral story or documentary series; c) their preferences in terms of what we call content temporality, where we make a distinction between synchronous, recent, seasonal and evergreen content; and d) their possibilities in terms of monetization schemes: advertisement, copyright, brand sponsoring, event, marketplace, micro-donations and paid subscription, among others.
Special characteristics of the Argentine market:
The “click value” is relatively smaller (and it is depreciated).
The Argentine market has adverse structural conditions compared to more massive markets in the Ibero-American region, such as the Mexican, Brazilian or Spanish ones. The limited size of the national advertisement market and the value of subscriptions to platforms in the local currency, constantly depreciated, may be discouraging when a creator tries to translate their reproductions, views and advertisement. This can create asymmetries and distortions for the development of the local market and ecosystem.
High level of cultural innovation and regional leadership that invites to cross borders.
Formats, styles, personalities, music movements, producers and concepts emerge from the country, and they cross borders and set trends in the region. As a consequence of the situation described before, these leading actors with a potential for scale and massiveness will see, sooner than later, that this prominence leads to better relative remuneration, as it allows them to cross some reproduction and engagement thresholds from which not only do their audiences become regional and international, but they gain access to other values in terms of click value.
Fewer platform monetization and investment options available.
The medium-sized audience market, its lower income available for subscriptions measured in international currency and the smaller advertisement market reduces incentives for platforms to completely deploy their entire offer in the country. As a consequence, the possibilities for incubation, access and promotion of new creators are affected. This lack of availability has also propelled related digital services, for example, micro-donations, to make up for this missing offer.
Dependence, diversification and bargaining power.
Creators are fully aware of their dependence on the platforms in general and some platforms in particular. Now then, that dependence is not questioned so much by the most successful creators but accepted as the rule of the game and, in some way, socially re-owned, which leads them to specialize in the platforms where they obtain their main monetization scheme. That is to say, creators seem to respond through a strategy of specialization in the platforms that their biggest sources of income depend on (which have some socio-technical formats and some algorithmic policies), rather than pivoting strategies among platforms, and even less migrating, although they try to diversify the sources of monetization by adding sponsored contents, sponsored events and the commercialization of goods and services in their own marketplaces. That is to say, reducing their economic dependence, and not so much their infrastructural dependence in terms of channel development.
