It started with a The Game Theorists video called “They stole $1.7 Million.” I was hesitant at first about clicking the video, it sounded clickbaity. But, I clicked anyway; I’ve been watching Game Theorists’ videos for awhile now and figured, “meh.” It started out with MatPat talking about all the high and low points of 2018. I thought, “Oh, it’s one of those videos,” but I was interested in what this $1.7 million was about. Finally, the video came to Defy Media, a YouTube multi-channel network (MCN), and how it stole from 50 YouTube Creators. Now, I’m looking into the issue myself (*sigh* How do I keep getting myself in these messes.)
According to the video and YouTube’s support page, an MCN helps channels with “audience development, content programming, creator collaborations, digital rights management, monetization, and/or sales.” It kind of works like a publishing company. An author submits their manuscript and if the company likes it, they distribute it and help the author with marketing, sales, legal issues, editing, and so on. When a book sells, the money goes to the company; they take their piece; and give the royalties to the author. The MCN does the same (except the Creator publishes the video on YouTube and YouTube distributes it); YouTube pays the MCN the ad money; the MCN takes their cut and gives the rest to the Creator. It’s not that abnormal of a process. It works pretty smoothly until someone decides to be a jerk.
According to The Hollywood Reporter, Defy Media announced its closer on Nov. 6 and that most, if not all, of their YouTube affiliates found out through the press, not the company. The YouTube Creators naturally began wondering about their AdSense paychecks, since YouTube sends the money to Defy Media and they give it to the Creators. So, the Creators asked Defy Media what was happening. According to the article, they got little to no response. Even The Hollywood Reporter couldn’t get the Defy Media CEO Matthew Diamond to comment.
The article continues to state that, “Some partner managers who were laid off are still responding to creators’ requests via personal phone numbers and email addresses, say sources, but they have had few answers.” In other words, some of the employees who just lost their jobs are now using their own time and resources to try and manage the mess.
Fortunately, YouTube has stepped forward to say that they will begin sending the Creators’ next paychecks to the Creators. But, some Creators say Defy Media still owes them money, specifically the money Defy Media received before the closure (Sept. and Oct.).
Also, according to the article, many of the YouTube Creators believe that Ally Bank now has control over the money. These Creators have been contacting the bank in order to let them know that some of the money is theirs. Again, they haven’t been told much. The Hollywood Reporter tried to get in touch with Ally Bank but the spokesperson “did not respond to a THR’s request for an interview.” I can understand that Ally needs time to look through the Defy Media records, discuss what to do, and so on, but at least tell people, “We’re looking into it; we’ll let you know more at X time.” Even a little information is better than none.
Apparently, Variety and The Verge also had trouble reaching Defy Media so they could tell their side of the issue. The Verge adds that Defy Media has also gone “radio silent on social media.” I recently checked Defy Media’s Twitter feed; the last tweet was in September of last year, and it was nothing about closing down. Their Facebook page also ends in September with no mention of a shutdown. And their website no longer exists.
The THR article further states that not only are the YouTube Creators angry, but so are the laid off employees. At least one has filed a class-action lawsuit stating that Defy Media didn’t inform them as is required by law. It turns out, Defy Media did send them the proper paperwork stating that the company would continue to run until Jan. 2, but they then closed at the end of Nov. 6–the day the employees got the letter.
So, what can you do? Research the topic for yourself, come to your own conclusions, then (if you so choose) support whichever side it is you believe to be right. If you believe the YouTube Creators, you can support their channels (some are listed listed in the above mentioned articles). You can also tell others about the issue through social media or on your own blog. If you believe Defy Media, you can do the same, share your opinion on social media.
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