Huge YouTube Terms of Service Update

We live in times where big news is buried by even bigger news. Yesterday, we saw an example of that. YouTube announced some changes to its terms of service that have largely gone unnoticed but have a huge impact on ecommerce. Here is an excerpt:

Right to Monetize

You grant to YouTube the right to monetize your Content on the Service (and such monetization may include displaying ads on or within Content or charging users a fee for access). This Agreement does not entitle you to any payments. Starting November 18, 2020, any payments you may be entitled to receive from YouTube under any other agreement between you and YouTube (including for example payments under the YouTube Partner Program, Channel memberships or Super Chat) will be treated as royalties.  If required by law, Google will withhold taxes from such payments.

What that means is this: you no longer have the right to keep your YouTube videos free of ads. If you have a promotional video on YouTube, watchers may see your competitor’s ads on that video.

I have mixed feelings about this. On the one hand, I am sad to see this change because I have YouTube videos with millions of views that have generated enormous exposure and revenue over the past decade. On the flip side, I get it. YouTube does not owe any business a free ride.

Regardless of my feelings, if your company relies on YouTube videos, you should start thinking about the adjustments you need to make. I suspect that you have some time; I have no evidence that Google is already running ads on videos that are not monetized. If I had to guess, that might start in the first quarter of 2021.

Here are some possible changes you should consider:

• If you are using YouTube just to serve videos on your website, upload those videos to another service like Vimeo that allows you to serve those videos without ads.
• If you are using YouTube for potential customer exposure (hoping that potential customers will find out about you there), you might have to consider running ads on your own channel to lock out competitors. Because this is a new change, at the moment, we do not have enough information to know what strategies you will have available to you. Hopefully, we will know more soon.
• If appropriate, monetize your YouTube videos so that you will at least earn some revenue from the ads shown on your videos. Note that this TOS change states that YouTube does not have to split revenue with you, but I suspect that YouTube will continue to share revenue with those that cooperate in monetization.

Of course, YouTube is owned by Google. This change is part of a broader Google strategy to either keep its traffic on its platform or make advertisers pay for them to leave. It is very similar to what is happening with SEO and free listings on Google.com. The days of advertisers having a free ride are coming to an end.