Striking it rich on YouTube, the cash cow of cyberspace

By Nico Grant

Scott Mitchell became convinced YouTube would make him rich. Mitchell, 33, got the idea last year from videos that promoted courses on how to build so-called cash cow channels, which are often created through a process called YouTube automation. So he bought one course, then another and another. He also paid for mentorship services. Mitchell spent around $15,000 on his YouTube venture, encountering stumbling blocks at every stage — courses that taught him little, freelancers who stole content and audience-growth tactics that got him into trouble with YouTube.

“I’ve tried three courses and one expert on the side, and the only thing I got out of it was an empty wallet,” Mitchell said. YouTube automation has led to a cottage industry with online influencers offering tutorials and opportunities for fast money. But, as is often the case with promises of quickly made fortunes in online businesses, the YouTube automation process can be a money pit for aspiring internet entrepreneurs and a magnet for poseurs selling unhelpful services.

It is not difficult to find a video that fits the YouTube automation model, though it is hard to say for certain how many of them have been made. They usually have an unseen narrator and a catchy headline. They share news, explain a topic or offer a Top 10 list about celebrities or athletes. They often aggregate material like video clips and photos from other sources. Sometimes, they run into trouble with copyright rules.

The term “YouTube automation” is a bit of a misnomer. It usually means farming out work to freelancers rather than relying on an automated process. It is hardly a new idea and yet one that has recently become more popular. Farming out work allows people to run multiple channels, without the time-consuming tasks of writing scripts, recording voice-overs or editing video. And the process is often pitched as a foolproof way to make cash. To get started, you just need money — for how-to courses and video producers.

The courses instruct people to find video topics that viewers crave. They are told to hire freelancers from online marketplaces where independent contractors, like Fiverr and Upwork, offer to manage their channels and to produce videos that cost from under $30 to more than $100, depending on freelancers’ rates. And that’s where many people run into trouble.

Cash cow channels with big audiences can rake in tens of thousands of dollars in monthly ad revenue, while unpopular ones can make nothing. YouTube shares ad revenue with a channel’s owner after a channel gets 1,000 subscribers and 4,000 hours of viewership. Monetised channels get 55 percent of the money their videos generate — that is, if they manage to scratch out that much interest. YouTube declined to comment on the automation process.

Last summer, Mitchell paid $500 for a course titled “Tube Mastery and Monetisation” taught by Matt Par, who said he made $30,000 a month on YouTube. He said successful students had earned $20,000 a month. The course featured videos on different aspects of YouTube automation, including choosing the most lucrative subject matter, outsourcing the work and using keywords to make videos easier to find on YouTube. Par also explained how YouTube’s algorithms worked.

But Mitchell said the course had gaps — it lacked information on making high-quality videos with good scripts. He and other students also complained in a private Facebook group that the contents of Par’s course were available for free on his YouTube page. “It is basically selling dreams,” Mitchell said.

Nico Grant is a journalist with NYT©2022

The New York Times