“He who fights with monsters should look to it that he himself does not become a monster. And when you stare into the abyss the abyss stares back at you.”

Friedrich Nietzsche

Yes, that may be true. I can’t say much about Twitch because I don’t know anything about it.

Yes, having a large audience is the problem. If you have that, you can earn good money on YouTube too, especially since you can sign additional marketing deals. The thing is, though, that getting a large audience is anything but easy—most people who try fail.

Yes, successful streamers are literally one in a million, if that’s even enough.

There are basically two approaches:

• Social media agencies that manage company accounts on behalf of their clients and have their employees produce content for them.
• Agencies that operate their own accounts, which are financed through product placement, e-commerce (mostly dropshipping), or affiliate marketing.

Typically, these companies pursue both approaches simultaneously.

What they offer the actual content producers, i.e., the (sometimes even pseudo-self-employed) employees, is the following:

• A salary or at least project-based remuneration
• A network of contacts to advertising customers and thus lucrative sources of revenue that are pretty much unattainable for individuals without significant reach (they have sales people to protect those contracts from the people that do the content of course - usually these people are called account managers or something tacky along those lines)
• A network of contacts to other “influencers” in order to gain subscribers, etc. through strategic cooperation
• Know-how on how to build up accounts
• Professional equipment (cameras, dongles, drones, video editing applications and so on) as well as social media marketing tools for reporting, planning, and automation, which are not exactly cheap
• In some cases, substantial advertising budgets for ads to promote new accounts (performance marketing) and, in the case of campaigns for external clients, “seals of approval” from meta and other Plattforms (meta, Google or TikTok “Business Partner” for example — these seals are exclusively issued to companies who spend a significant amount on ads on the respective platform)
• Opportunities to collaborate with other employees of the company, which can also create network effects.

There are certainly other advantages, but the key point is the contact with advertising customers, i.e., companies that want to engage in social media marketing. These contacts are only accessible to private individuals if they already have one or multiple successful accounts, which unfortunately only very few of those aspiring to a professional career in this field ever achieve.

Exactly, it’s the American dream that has always been propagated to conceal the true circumstances and thus ensure that everything stays the same.

Sometimes I get the impression that social media fame is continuing the narrative of the American dream worldwide: strangely enough, many people assume that it happens regularly that someone steps out of their parent’s bedroom, records a few videos, and overnight, without much effort, becomes a multimillionaire – just like that.

This is the absolute exception and has hardly happened at all for a long time. Online, it’s long been like the real world economy: without the support of powerful players, it’s basically impossible for anyone to become successful. It’s a tough business with an endless number of competing content producers, from whom influential financiers can choose the content and the faces to go with it and pocket the lion’s share.

And there is yet another misconception underlying the illusion of quick money: you only earn enough to live on once you have a certain reach – something very few people achieve. Most work hard for ridiculously low income, if they earn anything at all.

Consumers, on the other hand, persist in the attitude that the internet has taught them over the last twenty years: they expect high-quality content on a daily basis without having to pay anything for that. They assume that the producers of this content earn good money from it, but in the vast majority of cases - and if there is any money made in the first place - this is not true at all, because it is not the creative people who earn big, but those who exploit them.

Anyone who believes that content producers can finance themselves through voluntary donations is usually completely wrong — Wikipedia’s fundraising campaigns, in which only a tiny percentage of users contribute anything, are just one example of many, even though Wikipedia is one of the most visited websites in many countries around the world.

I assume that tax avoidance is also a factor.