Calling Twitch's growth during the pandemic a simple benefit would understate the situation. According to a 2021 report, the number of hours watched on the site increased 45% from 2020 to 2021. At that moment, the platform seemed simply unbeatable, destined to establish itself permanently as one of the world's largest entertainment platforms. However, the situation changed considerably in the years that followed.
The company went through several CEO changes, saw many of its leading creators leave, ended its operations in South Korea, and faced two rounds of layoffs, resulting in cuts to more than one-third of its staff.
But what is actually causing this gradual "chaos" at one of the world's largest entertainment platforms?
Streamer Boycott, Audience Decline, and Mass Layoffs
To understand where things went wrong, we need to revisit the internet landscape in 2020 and 2021. The Covid-19 pandemic became a global issue, driving millions of people into lockdown. With more time at home, people began consuming more content online. Gaming-related production soon expanded as a result.
Twitch, purchased by Amazon just over six years earlier, rose to become one of the most-watched platforms in the world. Twitch's meteoric rise greatly benefited many content producers and, at least at that moment, the number of channels and streams increased sharply.
However, when the global economy reopened, the number of people accessing or subscribing to the platform declined. This figure began leading the company to make decisions that contributed significantly to its downturn. The audience began to plummet, forcing cost-cutting policies. In 2023, the company decided to dismiss 35% of its workforce, which translates to around 500 employees.
As if that were not enough, Twitch faced a severe boycott by several content producers. Amid declining viewership, this caused even more people to abandon the platform entirely and begin following other sites such as YouTube and TikTok, which grew considerably between 2022 and 2024 after the pandemic.
This boycott, which gained the hashtag #ADayOffTwitch, occurred because of several issues, including concerns about content-moderation policies, transparency in monetization practices, and working conditions for content creators. For example, creators complained about the excessive number of hours they were required to stream on the platform to receive what they considered a reasonable amount from the company.
There was also the issue of eradicating so-called "hate raids," the practice of extremist content creators transferring their viewers to other people's streams in order to provoke or offend them. These problems led some influential streamers to temporarily suspend their activities on the platform in protest.
Users also began complaining about the experience Twitch provided. The excessive number of ads shown to visitors was the main subject of complaints. In addition, some users also reported difficulty accessing livestreams through the app and website at various times between 2021 and 2023.
The Announcement of Changes
Twitch recently released a statement about significant changes that promise to increase streamers' earnings. Expanding the "Partner Plus" program is one of the central points of these changes. The program, created in 2023, aims to provide greater stability for content producers' careers on the platform. This expansion seeks to reach a broader audience, offering content producers benefits such as a 70/30 secondary-revenue split (70% for the streamer and 30% for the platform).
Another announcement specifically targets streamers who generate revenue above US$100,000 (approximately R$500,000). These creators currently receive only 50% of that revenue on the platform. This percentage will now rise to 70%, following the 70/30 model already mentioned, which will result in a significant revenue increase for these content producers.
Despite the planned changes, revenue projectionsare still not optimistic. These unfavorable projections are attributed to concern about the steep audience decline in recent times and the high operating costs associated with maintaining a platform that supports 1.8 billion hours of live video content per month.
Twitch has sought ways to monetize its audience by adjusting content monetization models and payments to creators. However, growing competition from new platforms such as Kick, which is offering million-dollar contracts to Twitch's top streamers, has also affected its strategy.
At a decisive moment for the platform's future, Amazon is expected to reverse the situation by bringing strategies to Twitch that help restore users' confidence in its services and reinforce the brand's full potential. Beyond that, it must innovate and keep pace with the market as new needs arise.
