Netflix is paying top YouTube creators to make it their second home. YouTube, which shares ad revenue rather than paying upfront, rolled out microdramas, AI editing and live Spanish dubbing to keep them close.
YouTube built the world's largest video platform on creators. Now it is fighting to keep them from spending more of their time somewhere else.
Netflix has been signing some of YouTube's biggest names to deals that bring their shows to its service. It started with children's creators such as "Ms. Rachel," "Mark Rober's CrunchLabs" and "Danny Go!", which are now among its most popular content with kids. It has since moved into video podcasts and recruited producers of shows including "Good Mythical Morning" and "Alan's Universe." The deals are typically global and let creators keep working with YouTube, but not with other streaming services.
YouTube cannot match that approach directly. Its model is to share advertising revenue rather than write large upfront checks. Creators typically receive 55% of the ad revenue generated from their videos.
So YouTube, owned by Alphabet, is competing on tools. At its Made on YouTube event on Wednesday, it announced a feature that lets creators of YouTube Shorts produce episodic microdrama series that play one after another. It launched an AI storytelling assistant that analyzes scripts and rough cuts against what has worked on a given channel, and a tool that lets creators publish different versions of a video and remove the one that performs worse. Live streamers will soon be able to use AI dubbing from English to Spanish. Viewers will get custom feeds based on mood and interests.
"We pride ourselves on the fact that because we've created a home for creators, it has created all these other amazing opportunities for them," Chief Executive Neal Mohan said.
YouTube also has leverage beyond tools. It has told creators considering a Netflix deal that it may be harder to set them up with brand partnerships or feature them at advertiser events such as its annual Brandcast. "When you're speaking to an advertiser, they have to have some understanding about where this content is available and when," Mohan said. "A creator's posting strategy has implications."
The scale gap favors YouTube for now. It accounted for 14.2% of streaming video viewing on U.S. televisions in July, nearly twice No. 2 Netflix, according to Nielsen. It also remains the only realistic platform for creators making longer videos to build channels with millions of subscribers, which is why Netflix's deals ask creators to cross-publish rather than leave.
The effect on creators so far is mixed. Data from strategy firm Tubular Labs shows some creators' YouTube views have fallen after signing with Netflix, while others have risen. Tim Katz, YouTube's vice president of partnerships, said his team is watching those trends closely so that creators "understand the decisions that they're making."
YouTube also locked in a marquee live event, renewing its deal to stream the Coachella festival exclusively through 2030.
For Netflix, creator deals can add viewing hours at a fraction of the cost of premium productions. For YouTube, every creator who splits time may mean a share of watch time and ad inventory it no longer controls alone. The next round of creator signings, and whether the biggest names keep posting on YouTube at the same pace afterward, will show whether tools can hold what checks are trying to pry loose.