Santa Ana-based entrepreneur Charlie Chang spent years posting finance videos on YouTube before he made a profit.
Today, Chang’s media business oversees more than 50 YouTube channels, along with other digital sites, and generates $3 million to $4 million in annual revenue, he said.
But lately, he’s been faced with a new concern: that YouTube’s moves in artificial intelligence will eat into his business.
“The fear is there, and I’m still building the channels, but I am preparing, just in case my channels become irrelevant,” Chang, 33, said. “I don’t know if I’m gonna be building YouTube channels forever.”
YouTube’s parent company, Google, is using a subset of the platform’s videos to train AI applications, including its text-to-video tool Veo. That includes videos made by users who have built their livelihoods on the service, helping turn it into the biggest streaming entertainment provider in the U.S.
The move has sparked deep tensions between the world’s biggest online video company and some of the creators who helped make it a behemoth. Google, creators say, is using their data to train something that could become their biggest competitor.
The schism comes at a pivotal time for Google, which is in a race with rivals including Meta, OpenAI and Runway for dominance in the market for AI-driven video programs. Google has an advantage due to YouTube’s huge video library, with more than 20 billion videos uploaded to its platform as of April.
Many creators worry such tools could make it easier for other people to replicate the style of their videos, by typing in text prompts that could produce images or concepts similar to what popular creators produce. What if AI-generated videos became more popular than their material? Creators say they can’t opt out of AI training and that Google does not compensate them for using videos for such purposes.
“It makes me sad, because I was a big part of this whole creator economy, and now, it’s literally being dismantled by the company that built it,” said Kathleen Grace, a former YouTube employee who is now chief strategy officer at Vermillio, a Chicago-based company that tracks people’s digital likenesses and intellectual property. “I think they should be with pitchforks outside San Bruno.”
YouTube, founded in 2005, was built on creators posting content. At first, the user-generated videos were amateurish. But eventually, creators got more sophisticated and professional, doing more elaborate stunts and hiring staffs to support their productions.
Key to YouTube’s early success was its investment in its video creators. The San Bruno, Calif.-based company shares ad revenue with its creators, which can be huge. That business model has kept creators loyal to YouTube. As they grew their audiences, that in turn increased advertising revenue for both YouTube and creators.
Video creators are typically not employees of YouTube or Google. Many are independents who have built businesses by posting content, making money through ads, brand deals and merchandise. The creator economy is a bright spot amid struggles in the entertainment industry. Last year, there were more than 490,000 jobs supported by YouTube’s creative ecosystem in the U.S., according to YouTube, citing data from Oxford Economics. YouTube has a greater share of U.S. TV viewership than Netflix and the combined channels of Walt Disney Co., according to Nielsen.
YouTube said it has paid more than $70 billion to creators, artists and media companies from 2021 to 2023.
The company has encouraged creators and filmmakers to use Google’s AI tools to help with brainstorming and creating videos, which could make them faster and more efficient. Some creators said they use AI to help hash out concepts, cut down on production costs and showcase bold ideas.
YouTube is also developing tools that will help identify and manage AI-generated content featuring creators’ likeness. Additionally, it made changes to its privacy policy for people to request removal of AI-generated content that simulates them on the platform, said company spokesman Jack Malon.
“YouTube only succeeds when creators do,” Malon said in a statement. “That partnership, which has delivered billions to the creator economy, is driven by continuous innovation—from the systems that power our recommendations to new AI tools. We’ve always used YouTube data to make these systems better, and we remain committed to building technology that expands opportunity, while leading the industry with safeguards against the misuse of AI.”
But already, creators say they are facing challenges from other people who are using AI to re-create their channels, cutting into their revenue and brand recognition.
“They’re training on things that we, the creators, are creating, but we’re not getting anything in return for the help that we are providing,” said Cory Williams, 44-year-old Oklahoma-based creator of Silly Crocodile, a popular animated character on YouTube.
In other cases, people are using AI to make deepfake versions of creators and falsely posing as them to message fans, said Vermillio’s Grace.
When people upload videos to YouTube, they agree to the company’s terms of service, which grants a royalty-free license to YouTube’s business and its affiliates.
But many creators said they were not aware YouTube videos were used to train Veo until they read about it in media reports. Melissa Hunter, chief executive of Family Video Network, a consulting firm for family-focused creators, said tools like Veo didn’t exist when she signed YouTube’s terms of service years ago.
Back in 2012, Hunter’s son (then 8 years old) wanted to start a YouTube channel together. Her son, now 22, is against AI for environmental reasons, so Hunter made those videos private. But Hunter said Google can still see those videos, and she’s concerned they were used to train Veo without her permission.
“It’s frustrating, and I don’t like it, but I also feel totally helpless to do anything,” Hunter said.
While there are other social media platforms such as TikTok and Instagram that also support content creators, YouTubers say they have already built large audiences on Google’s platform and are reluctant to leave.
“Creators are in a tough spot where this is the best platform to make money … to build real loyal fans,” said Jake Tran, 27, who makes documentary YouTube videos on money, power, war and crime. “So are you going to give up just because Google is using it to train their AI?”
Last year, Tran’s YouTube business made around $1 million in revenue. Tran also is founder of Scottsdale, Ariz.-based skin-care business Evil Goods and together his businesses employ 40 to 45 part-time and full-time workers.
Other AI companies including Meta and OpenAI have come under fire by copyright holders who have accused them of training AI models on their intellectual property. Disney and Universal Pictures sued AI business Midjourney in June for copyright infringement. Tech industry executives have said that they should be able to train AI models with content available online under the “fair use” doctrine, which allows for the limited reproduction of material without permission from the copyright holder.
Some legal experts think creators might have a case if they decided to take their issue to court.
“There’s room to argue that simply by agreeing to the terms of service, they have not granted a license to YouTube or Google for AI training purposes, so that might be something that could be argued in the lawsuit,” said Mark Lezama, a partner at law firm Knobbe Martens. “There’s room to argue on both sides.”
Eugene Lee, CEO of ChannelMeter, a data and payments company for the creator economy, said he believes the only way creators can win is by using AI, not by fighting against it.
“Creators should absolutely embrace it and embrace it early, and embrace it as part of their production process, script generators, thumbnail generators — all these things that will require human labor to do in a massive amount of time and resources and capital,” Lee said.
Nate O’Brien, a Philadelphia creator who oversees YouTube channels about finance, estimates that his revenue will be flat or decline slightly in part because it’ll be more challenging to get noticed on YouTube.
“It’s just a numbers game there,” O’Brien said. “But I think generally a person making a video would still perform better or rank better than an AI video right now. In a few more years, it might change.”
To prepare for the growth of AI content, O’Brien has been experimenting with using AI for videos on one of his channels, asking his assistant to take a script based on an existing video he made on a different channel and using AI to voice it. While the views have not outpaced the human-created videos, the AI-generated videos are lower in production cost. One garnered 5,000 views, 27-year-old O’Brien said.
Some creators have opted to share their video libraries with outside AI companies in exchange for compensation. For example, Salt Lake City YouTube creator Aaron de Azevedo, who oversees 20 YouTube channels, said he shared 30 terabytes of video footage in a deal with an AI company for roughly $9,000.
“There’s a good chunk of change,” De Azevedo, 40, said. “It was good, paid for most of my wedding.”
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