MrBeast is changing the economics of YouTube
The top echelons of YouTubers are now spending upwards of $3.5 million per video.
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MrBeast is changing the economics of YouTube
If you want a snapshot of how much the YouTuber ecosystem has matured in recent years, look no further than MrBeast’s latest video: “$456,000 Squid Game In Real Life!”
Posted on November 24, it’s the fastest non-music video to reach 100 million views, but that’s not what makes it remarkable.
Let’s first consider what went into making the video. As MrBeast explains in the beginning, “I recreated every single set from [Netflix’s] Squid Game in real life, and whichever one of these 456 people survives the longest wins $456,000.”
And these weren’t hastily thrown together props. From watching the video, it’s clear that his team built elaborate sets that spanned tens of thousands of square feet. They also fabricated hundreds of costumes and pulled together a sophisticated tech infrastructure that allowed them to track who had been eliminated. Their devotion to the original source material is extraordinary.
Then there’s the prize money. We’re not just talking about the $456,000 grand prize. After the second elimination round, he informs the 90 people who were eliminated that they will each leave with $2,000. A few minutes later, in an effort to thin out the herd, he offers up $4,000 to anyone who will voluntarily leave. Several dozen take him up on his offer. At some point in the video, he reveals that he spent $3.5 million to produce it. According to some estimates, that’s more than what it costs to produce an average episode of a cable drama.
While this may be MrBeast’s most expensive video to date, it’s by no means an anomaly. In a recent episode of the Colin and Samir Show, he detailed all the expenses that go into each video, from the full-time production crews to the custom-built sets to the money he gives away to contestants. Oh, and he also bought two huge warehouses for $10 million.
Five years ago, it would have been difficult to imagine such an operation sprouting up on YouTube. The early generations of YouTube stars utilized little more than a camera and a laptop to create content. In cases where they produced something more elaborate — like when Casey Neistat rented out an entire mall and built a winter wonderland — it was usually a one-off affair. The economics of YouTube simply didn’t allow for anything more elaborate.
Flash forward to today, and it’s clear that’s no longer the case. MrBeast is probably the most extreme example, but it’s pretty common to visit the YouTube trending tab and see David Dobrik giving away Lamborghinis, Johnny Harris shooting four-part documentaries in far-off locales, and Captain Disillusion creating Hollywood-quality special effects. The biggest YouTube channels are now spending millions of dollars a year on production costs.
The top echelons of the creator ecosystem now have the scale and diversified revenue streams that allow them to constantly push the limits of the YouTube economy. Does this mean we’ll ever see a Game-of-Thrones-level show debut on YouTube? It’s hard to say. But if a YouTuber can now drop $3.5 million on a single video, then a prestige drama doesn’t seem too far out of grasp.
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