How YouTubers Can Survive FCC COPPA Apocalypse (Join Zenither)

I don’t know how many of my friends who are YouTubers pay attention and see my posts these days. But I wanted to remind people that I am the President of Zenither, a multi-channel video streaming platform. We’re a startup with four patents on our video streaming technology that allows 24/7 TV channels to be managed and controlled with a laptop, making it as easy to run a TV network as it is to manage a YouTube channel.

While we’re not a user-generated platform like YouTube is, our platform was designed with creators in mind. We do host content produced by YouTubers, they just need to be approved by us. And we can be your new home and prevent you from losing the entire business you’ve created on YouTube.

(Keep in mind we’re looking for quality programming; if you couldn’t get into the YouTube Partner program or recruited by an MCN we’re probably not going to be able to help you but if you make videos people watch we can probably give you a new home.

Also If you haven’t heard about Zenither before please read this blog article and watch the demo videos. That way you’ll understand what I’m writing here more).

Recently YouTube settled a lawsuit with the FCC. The lawsuit charged YouTube with violating Children’s Online Privacy Protection Act (COPPA). The settlement requires YouTube to pay a fine but more importantly, it requires YouTube to make significant changes to its platform that are designed to prevent YouTube from serving ads to children without parental consent. These changes would require Google to make substantial alterations to its ad platform. Instead of making those changes YouTube is simply going to identify any content it believes kids might watch and demonetize it so that when it makes its annual reports to the FCC they can say they served no ads to “children” (because kids only watch “kids content” right??) and avoid further fines.

(“Children” is in parenthesis because the argument YT makes, that kids will only be watching content deemed “kids content” is very silly. YT will still be serving ads to kids, it just won’t be on any of the content it has labeled “kids content” and subsequently demonetized)

It is important for people to realize the problems YouTube has with the FCC is exclusive to YouTube. Other platforms aren’t subject to the settlement agreement they made. So the problems that YouTube has with the FCC are problems Zenither will never have.

And to be clear, the problem here is not your content being child-friendly. The real issue is that YouTube is unwilling to make their platform child friendly (namely by adjusting their ad system to stop violating the law). Instead of solving the problem by making their ad platform compliant with COPPA they are instead dumping the problem on the creators, so they can shift blame for who is responsible for “violating COPPA”. Google wants the FCC to blame the creators now who make content kids watch, instead of holding themselves accountant-able for building an ad platform that violates the law.

This is important to stress: Google is still going to be tracking kids on the internet with the cookies, as they have always done. They’re just claiming to the FCC as per this settlement agreement that they will not be serving ads to kids anymore because YouTube is trying to convince the FCC that by demonetize “kids content” then no ads will be served to kids.

The FCC has not specifically asked YouTube to demonetize kids content. Rather what is happening is the solution YouTube has chosen for how it will appease the FCC. They are passing the buck to the creators for a law YouTube violated, and serving the creator community up on a dinner plate to the FCC.

Instead of adjusting their ad system to simply not show ads to children they are instead pruning the YouTube platform of “kids content” so they can claim to the FCC that YouTube is not designed or aimed at kids. And with the new filter asking if your videos are “kids content” or not, YouTube is shifting blame for any mislabeling to the creators and removing their own liability. The FCC will fine you if they think your content is aimed at children, and they won’t fine YouTube.

That isn’t all that YouTube is doing. In addition to demonetizing the videos they are removing many features from them.

  • Channels and their videos will not appear in Search results.
  • Channels and their videos will not appear in any recommendations.
  • Channels and their videos will lose comment, chat and other functions.
  • Channels and their videos will be removed from the Partner program and lose all those features, too.
  • Channels will lose all notifications, including notifying subscribers of new video uploads.

Basically any YouTube channel deemed “kids content” is going to be treated like all of its videos are unlisted. And they are using a broad and vague definition for what is “kids content”.

If you really analyze the decision it doesn’t actually make any sense if the goal is to ensure YouTube is compliant with COPPA. I would argue that they aren’t truly complying with the FCC agreement by handling it this way but the FCC apparently doesn’t truly understand Google, YouTube or any of these tech companies they regulate. So people at the FCC in charge of regulating them aren’t realizing YouTube / Google is still going to track kids activity online and still use that data for its other ad products served on other content. They just won’t be using that data to serve ads on any content they deem “kids content”. But if a child watches say a movie trailer for an R rated movie, Google / YouTube is still serving ads to that child and consequently still in violation of COPPA.

But Kids Only Watch “Kids Content”, Right?? De-monetizing “Kids Content” Solves Everything, Right??

The assumption that content that has the label of “kids content” is the only kind of videos that a child may watch is quite naive.

If you want to ensure you don’t serve ads to kids, then don’t serve ads to kids. The type of content is irrelevant. Google / YouTube could, if they wanted to, ensure that all users watch videos on YouTube while logged into a Google account. As part of the Google account there are Terms of Service agreements and opt in forms for COPPA. Google could even make sub accounts for a parent’s YouTube account that allows the parent to consent to serve advertising to their child while using YouTube. But Google cannot make this change for all of the millions of websites it serves ads on without building a workflow that would essentially destroy their advertising business (example: If every website you visit gave you a popup asking for permission to serve an ad you’d probably say “No”. So would tens of millions of other people and Google would make no money)

Google depends on being able to serve ads to people who are not logged in to an account and specifically, not able to say “No” to ads. And Google is aware that viewership for blog sites that block viewers from reading content if they don’t disable ad blocking software has resulted in many blogs losing significant amounts of traffic. Many people would rather not use an app or read a news article if it means they need to turn off an ad blocker; the same applies to asking them to login to a Google account and consent to be advertised to before they can watch a video or read an article.

So Google has decided to sacrifice the YouTube creator community in order to keep the rest of their ad business going, since if they were actually required to make their ad platform compliant with COPPA they would probably go out of business, or at least lose substantial amounts of revenue so as to be a significantly smaller company (it’s hard to pay for Google to fund all the moonshot side projects they do if they lose $110B+ in ad revenue.)

It’s also important for people to understand YouTube ran afoul of the FCC because they knowingly violated COPPA for years. COPPA isn’t a new law, it was passed in 2000. Since YouTube has existed it has always been that you’re not supposed to track children’s internet activity without parental consent and use that data to provide advertising without parental permission or awareness. Despite this Google has built its ad platform products around tracking cookies and never required users to login to YouTube in order to watch content. It doesn’t require people to login to any website it serves advertising to, either. None of the ads Google serves anywhere are in compliance with COPPA and Google will still be in violation of COPPA even after this settlement because the specific way they violate COPPA has not been addressed by the terms of this settlement.

So really Google / YouTube are passing the buck of responsibility onto the content creators, who they are screwing over while Google continues to monetize children’s data in violation of COPPA. And I know they still are because Google isn’t changing how their ad platform works. They rely on cookies to measure user activity and build a targeting profile for serving that user with ads. The problem with cookies is you cannot always be sure who is using the device, as children generally don’t own their own devices but use their parents computers and smart phones when they go on the internet, play games, and watch videos. It’s challenging to differentiate between multiple users of a device unless the user changes profiles themselves (which most apps and websites have no functionality to do). When kids use their parents’ device they are going to get tracked by the cookies meant for their parents and see the ads that were meant for their parents. That’s the core deficiency of serving digital advertising in such a decentralized way as Google does.

So now that YouTube’s deal with the FCC allows them to pass the blame onto the content creators (none of whom are tracking or serving ads to kids by the way; YouTube controls that aspect of the channel) YouTube no longer cares about YouTube channels that cater to children. They just don’t care about the youth demographic anymore for the platform and have no financial incentive to support them any longer.

They sold out the creators to avoid deeper impact on Google. And the FCC is telling creators they fully intend to fine any channel that they deem to be child focused and hasn’t marked their videos as such.

Don’t Bury Your Head in the Sand. This is Serious.

A lot of creators are under the mistaken impression that things like petitions or “no upload day” events are going to somehow change what has already been decided.

It won’t.

The FCC and YouTube don’t give a shit. And why should they? The FCC wants to stop YouTube from exploiting children and YouTube / Google sought the cheapest, fastest way possible to get the FCC off their backs without Google having to actually stop violating COPPA (which would require substantial changes to their ad system; so many that Google probably won’t be able to be the world’s richest company anymore when it needs permission from everyone to be able to serve advertising to them)

This is my prediction on what is happening. If you’ve read my blog you’ll note I have historically been correct when I make these types of predictions.

Come January 1st 2020 the YouTube platform will be a very different experience from what it has been historically. It will no longer focus on user-generated channels and indie voices. YouTube will instead prioritize clips from TV shows and movies, YouTube Original content, and other promotional material like movie trailers and music videos. Perhaps a handful of creators they work closely with.

But come January 1st 2020, we’re going to see 90% of the channels that once existed will be removed entirely from the platform because their content will be deemed “child friendly” and therefore now (per YouTube’s updated ToS) no longer “commercially viable” since they cannot run ads on that content anymore.

Think about it. If you were YouTube would you provide free hosting to trillions of videos you can’t make any money from anymore? I wouldn’t.

Now YouTube did not have to handle things like this. They could have negotiated better terms with the FCC. They could have paid their fine and then made significant changes to the way Google serves advertising so that tracking cookies are no longer used. They could have implemented things like child accounts which parents could create and let their kids use when watching YouTube (since the YouTube Kids app is obviously a lost cause). Yet they chose not to make changes to their ad system and instead decided to throw all the creators under the bus. This isn’t an accident. This is an intentional choice.

The reason? I believe it is because if Google made changes their ad system in order to comply with the FCC agreement then the FCC (and other state attorneys) will ask Google to make these changes to their entire ad platform, not just on YouTube. Which would devastate Google.

So YouTube needed a solution that allowed them to claim “YouTube doesn’t target children” when everyone knows that they do, and their solution to convince the FCC that they are “changing” is to remove all the “children’s programming” YouTube has and remove all incentives for users to upload kids’ content, like having comments on your channel or videos appearing in the search results.

You need to understand this because it’s important: YouTube is doing this because YouTube doesn’t care about you and your lives and your businesses and your fans. They never did. Because the folks running YouTube know that Google will still make billions of dollars every month selling ads anyway even if they demonetize hundreds and thousands of YouTube channels aimed at children. Because the truth is while ads for children is a money generator and children make up the largest viewer demographic on the platform, the reality is children’s advertising is not the biggest sector of the advertising industry. And somebody at YouTube (who is probably an accountant mentality type person) has weighed the pro’s and con’s of making YouTube compliant with FCC rules and decided making these changes wasn’t worth it.

Google chose not to make the required changes to how they sell and serve ads in a manner that would allow children’s content to continue to thrive on YouTube. This is for important reasons that have nothing to do with children and everything to do with ensuring Google isn’t required to allow people to opt out of advertising; or least, delaying this inevitable requirement for as long as they can.

Advertising to children is not illegal. TV networks like Nickelodeon and Cartoon Network have been doing it for decades. It’s specifically how Google does it that is illegal. They could change how they do it but have opted to not.

Why are they so willing to screw over the creators? My guess is because the people making these choices are idiots who only care about making the legal problem go away as fast as possible and they don’t care about the long-term consequences of these changes. They don’t care about how their decisions impact the lives of others. They only care about Google’s success, because Google writes their checks. So ultimately they only care about themselves. And they probably think if Google had to change its ad platform to be COPPA compliant they would be out of a job.

Essentially, the same type of narrow minded and selfish mentality that resulted in COPPA being violated in the first place. Google has opted for the “quick, easy solution” the FCC would accept, even though this solution allows Google to continue to violate COPPA by continuing to collect data on kids using cookies and serve advertising to them on other non-YouTube websites. The manner in which they violate COPPA has not and is not going to change.

(And you can take issue with me calling senior execs at Google and YouTube “idiots” but the fact of the matter is they have built a business based on violating privacy laws such as COPPA and even when faced with the reality of being fined, have still chosen to not address the specific things about their business that violate the law. Instead they shifted the blame to the very people who made YouTube a success and enabled them to make all these billions of dollars every year — the creators. At some point there will be real legal consequences to all of this when someone at the FCC finally understands how Google’s ad platform actually works).

Google / YouTube doesn’t care about you and they don’t care about your fans. And the people at YouTube and Google making these choices only care about keeping their job by making the legal problem go away as fast and as cheap as possible. That’s why this is happening.

So if you are a YouTube creator with a partnered channel you need to accept two things right now.

  1. YouTube is going to kill your business to save theirs. And the FCC has broad rules defining “children’s content” that could apply to basically any G / PG rated content anyone has ever made. If you make say gaming videos, and you mark your content as “not for kids” the FCC is going to disagree because they define all gaming content as content for kids. Trying to argue with them isn’t going to make any difference at all. In fact trying to argue with the FCC about your content designation might get you fined by $25,000.
  2. You need to find a new home for your content and your audience before Jan 1st 2020. That’s the date YouTube’s AI bots will conduct mass demonetization and removal of channel features such as commenting, and prevent your audiences from actually being able to see your new videos. I would suspect within 60 days of channels being identified as “kids content” by YouTube’s AI the entire channel will be deleted. So if you don’t tell your audience by Jan 1st where you’re moving your content to they are probably never going to find you again.

Where Should You Move Your Content and Audience to?

Because people are facing their entire live-hoods being ripped away from them we’re going to see a lot of people make two kinds of decisions;

  • Panicky, dumb decisions.
  • Really intelligent and long term thinking decisions.

The difficulty is that many of the people making panicky, dumb decisions are going to think it’s a really intelligent and long term focused one that they are making.

What we’ll see is many big YouTubers look to create their own alternative YouTube believing it’s a good choice when really it’s not. It will fail, just like every other YouTube clone project has always failed, because user generated video platform is a very difficult business with tremendous overhead costs that only works when those tremendous upfront costs are absorbed by a massive company like Google. There is a tremendous amount of wasted bandwidth data and space on YouTube by videos that are just not monetiziable, and then you have a lot of troll content, hateful content, etc and so on. Several YouTube clone projects have died simply because they spent all their money paying hosting fees on garbage videos they couldn’t monetize. Vid.me explained this in their final blog article.

(This is why Zenither is not a user-generated platform. We screen the YouTube creators we work with to ensure they are producing original programming that can be monetized.

And you might call me harsh for referring to someone else’s videos as “garbage” but I distinctly recall Vid.me had tons of poor quality, low effort videos primarily complaining about politics which attracted no significant viewership. These were not entertaining videos and they cost Vid.me a lot to host. The platform also featured a lot of copyright infringing content because it’s nearly impossible to police pirate videos when virtually anyone can sign up and start uploading, and create a network of bots to help them do so. The mistakes Vid.me made are mistakes Zenither isn’t making)

Some of those YouTubers who don’t make a YouTube clone will at least attempt to make a personal video hosting site or app, maybe something like NormalBoots. This might work, but it probably won’t. The reason it probably won’t is for the same reason the majority of stand alone video hosting websites and apps fail; audiences do not want a dozen different websites / apps to watch video content on. They just want one.

Don’t disregard the laziness of the consumer. There hasn’t been a single YouTube creator who has convinced even half of their audience to stop watching their content on YouTube and watch it on their own branded app. The vast majority of consumers want to be able to channel surf and you can’t do that if everybody has their own app with its own unique user experience, login system, paywall, and unique set of technical difficulties. That’s why Disney+ had to give out 130M+ free accounts to Verizon Unlimited customers just to get anybody to even try their app.

What consumers want — and why I am getting around to encouraging you to move your content to Zenither — is that the average consumer of TV content wants a traditional TV experience for the most part. They do want to be able to channel surf from within one app and find lots of different programming. They want your channel to be one island in a sea of islands of different tastes and points of view. They want the search results to give them a lot of options on where to surf to.

That’s why cable TV worked so well, and it’s why YouTube worked so well. It’s about having an ecosystem of content choices available to the viewer and one centralized place they can discover lots of stuff in many different genres. What users hate the most about our current app focused market is that if they can’t find something of interest on Netflix they have to close Netflix and load another app. And if they can’t find something on that other app, they have to select another. And basically they end up hopping around a bunch of apps. Most people get frustrated and quit looking for something to watch if they can’t find something to watch in a few minutes. They move on to some other activity. This is why it’s so important that the “next YouTube” be a place that makes it easier for viewers to find high quality programming — and not need to dig through a sea of noise to find something worth watching.

So if you want to successfully leave YouTube and bring your audience then you need to build something similar to YouTube’s experience that has a ton of content from many hundreds of thousands of different creators so that your audience can channel surf.

Now YouTube creator, be honest with yourself; do you want to spend the hours of your day managing a video platform that has tens of thousands of OTHER people’s content on it and dealing with all the problems (getting advertisers, ensuring everyone is compliant with laws, managing engineering teams, dealing with customer support, etc. etc), OR do you just want to focus on making the original content YOU make?

I already know that the answer is going to be that you want to focus on your own stuff. If you wanted to manage other people’s stuff then you wouldn’t be a YouTube channel creator in the first place. And that’s fine; the market needs people to just focus on making original content. Not everyone needs to operate their own platform. Likewise the market needs someone to build the platform that original producers like you use. That’s where we at Zenither come into play.

So here is my suggestion: if you want to continue existing you need someone to create the “next YouTube” where you and hundreds of thousands of other creators can move to and the ecosystem that has benefited you can continue to exist. Fortunately for you we already built it. All that we are missing is your content and your audience who watches that content. Only you can provide this to Zenither.

Zenither is going to be the next big video platform, but we’re not a YouTube clone. We’re a television 2.0 TV Anywhere model that takes the best features of YouTube and combines it with the best business practices of traditional TV networks so that (ultimately) indie creators like you can operate (and earn the same $$$) as traditional TV networks do. I mean on Zenither you can actually set the starting bid price for ad inventory purchased on your channel. You can’t do that (or dozens of other very important things) on YouTube like you can with Zenither.

So I may sound bias, but I’m telling you the truth here. And I am going to recommend that anyone who has a channel with at least 30,000+ subs contact us over at Zenither and ask to work with us. Here’s why.

  1. Zenither was designed from the start to be compliant with all laws pertaining to minors using the internet. I knew this was eventually going to become an issue for YouTube. I put us ahead of the curve by having our ad system designed to ensure it would be COPPA compliant. We don’t have tracking cookies, and you must consent to our tracking when you register an account with us, and the tracking is only done while logged into an account and only pertains to us tracking viewership demographics of the programming that audiences watch. We also don’t serve any ads to minors without parental consent. We also don’t track any activity done outside of Zenither.

(Funnily enough one of the reasons Zenither has had difficulties growing is because we didn’t integrate with a company like Google to serve our advertising and instead built our own ad system that doesn’t use tracking cookies, and requires users to opt in. So this has meant many YTubers haven’t been willing to bring their audiences over because they want monetization on Day 1, when that just isn’t realistic. You’ll have monetization on Day 30 guys. This is a new platform. The infrastructure for ads is in place but advertisers bid on traffic. Give us traffic and you’ll get ads.)

2. Zenither was designed to allow creators to make more money than they can on YouTube. Here’s some info on how this works from one of our investor presentations.

Now keep in mind, we’re not YouTube. At Zenither we do have challenges and growth pains to overcome in order to compete with mega conglomerates like Google when it comes to selling ads. Every startup has challenges. Our main challenge has been that while some creators have made channels and provided us with their content, what they didn’t do is bring their audiences over because they didn’t have any ads pre-sold against their content. I’m sorry folks but there is no app in the world that will be able to provide you with advertising before you have people to advertise to (the users). Advertising against traffic you have is the *easiest* part of the video streaming business; the hardest part is building an original platform that actually has the features content creators and viewers need.

But we have recently made a deal with a third party ad service who can fulfill our ad inventory to make the process of monetizing channels on Zenither easier. I believe now that within 30 days of a new channel launching on Zenither we should be able to provide it with ad fulfillment against all its views. But this process won’t be instant. Advertisers purchase traffic and your channel needs to generate traffic for advertisers to want to buy it. So you need to establish a history of traffic if you want to get paid. Even YouTube required you to build an audience before you could monetize your channel. It’s the same idea.

Leaving YouTube to join Zenither might feel a little bit like “starting over” again. In a way it is. But you should look at it as an opportunity to build something new, rather than continue a relationship with a company like YouTube which has never treated its content creators like actual business partners.

Don’t Do Nothing

The changes at YouTube are coming unexpectedly for some and completely disrupting their businesses, even livelihoods. Because the changes coming are so huge there is a lot of folks who are reacting to them with disbelief. They are mistakenly believing that the changes won’t impact them at all. That somehow the FCC is going to give their channels an “exception”, or something.

It’s not going to happen, and the changes are going to severely reduce the population of YouTube. It’s not going to be the same place anymore. People who were making millions in ad revenue this year won’t be making bank next year.

It isn’t just this FCC settlement agreement that is forcing changes on YouTube; California passed a law last year that goes into effect in 2020 that also places requirements on companies like Google that will require substantial changes that I fully expect they won’t make. YouTube’s problems will worsen and they will continue to pass the buck to the creators as long as they can get away with it.

This shouldn’t surprise anyone. Most companies cannot retain their success forever, especially when their success may have been a consequence of getting away with violating federal law for many years. Google has historically been a very powerful company; that future is no longer certain. Don’t forget that 10 years ago Yahoo was the biggest internet company in the world and look at where they are now because they stopped caring about their customers and their business partners. Google will become the next Yahoo. I made a $1.3 million dollar bet on YouTube’s problems eventually coming to a head when I built Zenither and I’m turning out to be correct.

I don’t want to mislead people though; if you do join Zenither it is going to take more effort on your end than what you’ve done on YouTube. In addition to uploading videos and filling out their descriptions you also need to do things like schedule a channel. We’ve built some powerful tools to help define release patterns and automatically schedule content but you still have to maintain these things yourself.

There is a learning curve with our platform, but only because Zenither has more features than YouTube does. A lot of viewer discovery of videos revolves around daily programming your channel schedule. But these are good things, and they are things our team can assist with. We have a new publisher manual to help guide folks in how to build and manage new channels with us.

Join Zenither. Bring your audiences to your channels on Zenither. You will never have even half of the issues you have with Google with my company. Because I was a creator. And I do care about preserving what has been built within the Creator community and making it better.

YouTube is no longer a home for independent voices. It was never built to be. Zenither is and always will be because that’s why I built it in the first place.

In my next blog article, “Why YouTubers Should Start Channels on Zenither Before Jan 1st” I go into detail on specifically what makes Zenither better than YouTube. 

YouTube is a sinking ship. Don’t go down with it. Join us and let me show you how it’s supposed to be. But you have to bring your audiences over. We don’t have millions of dollars to spend on trying to advertise Zenither to your audiences. What we did is we built the house for them and for you to thrive in. You’ll need to guide the audiences over to the house. That’s the only thing missing here, and once we get a million users, I think creators will find Zenither is a better platform for serialized web content than YouTube was and audiences will appreciate our better subscription feed features so it’s much easier for them to find content from the channels they follow.

Join us. What have you got to lose that you aren’t already going to on Jan 1st?