Twitch has announced a big change to their subscription prices for several countries outside of the U.S. In an effort to boost subscription rates for streamers, Twitch is adjusting to a localized price model starting with Turkey and Mexico on May 20th. Lower prices will mean less money for streamers at first, but Twitch seems to believe that they'll translate to more subscribers and higher earnings in the long run.
In case you're unfamiliar with how Twitch works, streamers can accumulate both followers and subscribers. Followers are viewers who watch their channel and are alerted to when the streamer goes live, while subscribers receive additional perks like custom emotes and subsriber-only streams in exchange for a monthly fee. Currently, the most affordable subscription option costs $4.99 (USD).
Right now, this price is translated into local currency around the world - which can result in prohibitively expensive subscription rates for users in certain countries. The upcoming change is intended to make subscriptions more affordable for Twitch's global audience. According to a blog post, the company tested localized pricing in Brazil and noted that streamer revenue and total subscriber counts more than doubled.
Because of this adjustment, streamers might see their revenue fall as a result. Using this model, streamers will need more subscribers just to match their current earnings. Twitch has said if, after this initiative rolls out, a streamer's revenue falls beneath their usual baseline (which is calculated by Twitch for every streamer), Twitch will pay that streamer a "revenue adjustment incentive" to make up the difference.
Image from Wired.com
According to Twitch, they will "cover 100% of baseline channel and Prime sub revenue for three calendar months, including the month of the price change. After that, they will slowly decrease incentive payments by 25% every three months over the following 9 months, totaling a 12-month period of providing revenue adjustment incentives." You can read full details about the incentive here.
From Twitter's new tip jar feature (which is currently in testing), to Clubhouse letting people pay creators directly, these changes come as many platforms are looking for ways for creators to better monetize their followings. It will be interesting to see whether Twitch's new model will actually put more money in the pockets of streamers down the line, or if it will just make them work twice as hard for the same earnings.
Do you stream on Twitch? What are your thoughts? Share them with me!