The YouTube Formula

2The YouTube Ecosystem

In order for us to understand how YouTube really works, first we need to look at how it operates as a digital ecosystem. A digital ecosystem works much like a natural ecosystem: there are a lot of moving parts, and all of those parts affect the organization as a whole. Grade‐school science taught us about energy flow in a natural ecosystem; photosynthesis, plants and animals, decomposition, and nutrient conversion are all part of the cycle. Every factor in the chain has its job to do, and if it doesn't work right, it affects the entire operation.

YouTube's ecosystem also has a flow and cycle, and its contributors affect the whole, for better or for worse. This digital ecosystem includes the creator, the viewer, the advertiser/brand, copyright holders, multichannel networks (MCNs), and YouTube itself.

Here's a quick summary of how the YouTube ecosystem works: creators make videos and upload them to YouTube. Brands pay YouTube to run advertising alongside uploaded content, either before or during a video. When a channel meets the ad sharing program requirements, it gets a cut of the money from the ads running on their content. Brands also connect with creators who they think will be able to increase brand awareness and/or their bottom line. This influencer marketing is a huge part of YouTube's ecosystem. The viewers come to interact with content, creators, and communities. They watch, subscribe, comment, like and dislike, save, and share. YouTube as a website ...