Social sites have found a new monetization strategy and it leaves indie creators out in the cold

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We’ve officially entered the third wave of social media and it’s not good news for independent creators.

The first wave took place in those wild, wooly days when social media was still, well, fun. That’s because nobody — not users, brands, nor the platforms themselves — was sure anyone could ever make an dime on social networks. Yes, you could build an audience on Twitter and Facebook. And in turn those fans might pay you for goods later on down the road. But these networks were really little more than digital marketing arms, and that was totally fine.

But then people began to realize that social media content could be a monetizable product in and of itself. For example, porn stars were embracing Snapchat, charging users for the opportunity to follow their favorite adult performers and to receive X number of naked snaps per month. Meanwhile, Pinterest power users partnered directly with merchants to offer “affiliate links” so that when users clicked on a product featured in a pin, the person who shared the pin would receive a little money from the brand. It was the new digital hustle, and just like in any micro-economy where hustle is valued above all else, independent creators thrived.

Now we’ve entering the third wave — which isn’t so different from the second except for one major difference: social networks want to make sure that, if their users are getting paid, they get a piece of the action too. For example, as Snapchat ramps up its monetization schemes, the company banned porn stars who charge for their snaps. This was done in part because Snapchat, as it reaches the Puritanical maturity that comes with having your audience expand beyond freaks and early adopters, doesn’t want to associate with itself with the adult industry.

But perhaps the bigger reason is that, like a Mafia boss who observes some side-action taking place on his turf, Snapchat wants a cut of the spoils. One of the company’s latest updates to its terms and conditions prohibits users from doing the following:

Buy, sell, rent, lease, or otherwise offer in exchange for any compensation, access to your Snapchat account, Stories, Snaps, a Snapchat username, or a friend link without Snapchat’s prior written consent.

The key phrase here is “without Snapchat’s prior written consent.” That means, in all likelihood, any monetization schemes that occur on Snapchat must be a part of the official ad deals the company’s been aggressively striking with major brands and publishers.

Now Pinterest has launched a similar crack down, banning all affiliate links and asking power users to instead “participate in paid social media marketing involving Pinterest, be paid to curate a board or be paid to create original content for a business.” Affiliate links, because they are direct arrangements between the pinner and the brand, do not create any revenue for Pinterest.

I understand Pinterest’s and Snapchat’s desire to make a cut of these ad deals. In truth, these services are less messaging apps and social networks and more like ad networks which just so happen to offer a social utility that attracts massive numbers of users. Furthermore, despite their overwhelming popularity, for years neither Snapchat nor Pinterest made any money, and so every little bit helps.

Nevertheless, it does signal another evolutionary milestone in the modern social media economy, and one that is troubling for users — particularly independent creators. Affiliate linking was a very significant form of revenue for smaller-scale fashion and lifestyle bloggers, just as Snapchat followers were a big moneymaker for adult stars — particularly “cam girls” who, frankly, work in the safest and least exploitative sector of the porn industry. One blogger, Jay Miranda, responded to the affiliate link ban by tweeting, “Pinterest bans affiliate links. Just like that, a million blogger voices cried out, and were suddenly silenced.”

Bloggers are understandably upset because it’s unclear how they will make up this lost revenue. If every paid campaign must be a “Promoted Pin,” it seems as if bloggers, if they want to make any cash off their Pinterest board, would have to ask a brand to pay for a promoted tweet and pay the blogger to feature it on her board. This is the kind of ad deal that a brand might negotiate with a large publisher. But it may be too complex to set up with an independent blogger who likely doesn’t have a large sales team striking these deals.

Sadly, the Screwing-Over-Independent-Artists narrative has only become more prevalent in recent months. While YouTube has always taken a cut of the ad revenue generated by its creators’ videos, the platform now requires creators to sign on to incredibly onerous contract terms in order to preserve this revenue stream. Facebook has also made various changes to its News Feed algorithm so that, generally-speaking, the only brand posts that users ever see are the ones brands have paid Facebook to promote. Again, this is fine for bigger brands that can pay big bucks to have their message seen. And of course, companies like Facebook, Pinterest, and YouTube are perfectly within their rights to demand that users follow their rules and pay the piper if they want to exploit these networks for personal gain.

Nevertheless, the days of social media being a gloriously democratizing force that anybody could make a living off of is quickly becoming a thing of the past. Instead Internet ad deals are beginning to follow the same pattern as television ad deals: You have to pay to play, the best spots go to the highest bidders, and everyone else is stuck on the social media equivalent of cable access television.

[illustration by Hallie Bateman]

PandoDaily

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