Some people over the last couple years asked me why I constantly bring up the perils of being a Digital Sharecropper. The sad truth is that I see online business owners and freelancers fall into this trap so often that it bears repeating over and over again.
When you build your business entirely on someone else’s property, you can be evicted at any time.
Example #461… YouTube.
I occasionally lurk in this one particular FB Group because the members are hardcore into building YouTube channels and I think that’s a distribution medium that is important to understand, even if it isn’t something that I’m pursuing actively myself right now.
Today I noticed this message fly through my newsfeed by a guy whose channel on YT that I’ve personally looked at a few times out of interest – without identifying him specifically, he creates videos that go into the background of a particular science fiction TV series. It’s not really “fan fiction”, but it’s kind of like an in-depth analysis of things that have happened in the TV shows.
Anyway, this guy does a great job and his videos are good fun.
He has also managed to turn it into his full-time income – he had about 23,000 subscribers to his channel and something like 4m views of his videos over the last 12 months or so.
The other day he was testing out some new livestreaming software that he’d been having trouble with, he created an unlisted stream and because he was struggling to get it working, he was broadcasting white noise on his livestream.
Unfortunately, streaming white noise is a “no no” in YouTubeLand.
They suspended his channel for this violation. If you’re not familiar with YouTube nomenclature, when they suspend your channel like that, it’s banned permanently. You can appeal, but once they reject that, you’re done.
This guy appealed, explained that it was a simple technology mistake and within one hour YT replied, “Appeal denied.”
There are a number of significant YT Channel publishers and Top Contributors from Google’s Forums that are now tweeting and reaching out to YouTube saying, “Hey, this isn’t fair what you’re doing to this guy” so there’s a chance that a normal human at YT will fix it, but let’s put that aside for a second and assume he was not that lucky to have people going to bat for him.
He would be utterly screwed.
Actually, right now, he is utterly screwed.
His income from “his business” is totally gone, his appeal has been denied, his distribution platform is no longer available and his connection to his audience has been wiped out.
Now do you see why I keep saying that digital sharecropping is a pretty dangerous way to run your business?
Some AI function has picked up that he was streaming white noise and suspended his channel automagically and his appeal form has most likely been reviewed by someone making $10/day in the third world.
His only chance of recovery is having a bunch of strangers lobbying YouTube on Twitter and by some of them reaching out to people they know within the YT machine.
I mean, it wasn’t like he showed suicide victims swinging from trees or made a video of him and his mates using a taser on a dead animal. Apparently, those things only get your ads suspended for a few weeks.
But look, I’m not just beating up YouTube here, it could be any platform or marketplace – if you’re single source dependent, this could happen to you.
People ask me all the time, “Why don’t you think this could happen to you?”
I ask how?
The vast majority of my online business income is diversified:
I get some income from Udemy, I have some coming from Amazon’s affiliate program, I’ve got some coming in from third-party affiliate network, we have clients in our content business, I have coaching clients and then of course across our web properties we sell a bunch of different info products directly.
Now, based on that, look at the weak points:
- Udemy could shut me down tomorrow, but that isn’t enough money to worry about as a portion of our online income
- Amazon could close my affiliate account, but again, that’s not that significant of an amount that it would worry me
- The biggest risks are Paypal and Stripe right now, if my accounts for those were closed, that would be problematic in the short term, but ultimately it would be resolvable
Some other critical systems that could “potentially” be shut down by a third party:
- Our webhost, Linode, could close our accounts, but they are backed up and there are thousands of webhosts, so that’s not a problem
- ActiveCampaign could terminate my account, but I back up my email list and again, there are dozens of other options for that including self-hosting
- ThriveCart is a lifetime license, so I guess they could terminate it, but I know Josh Bartlett who runs it pretty well, so I’d reach out to him before that and even then, replacing ThriveCart is fairly straightforward
There just aren’t that many critical risk factors in my online businesses that are held by third-parties. Most of the exposure is to Amazon and Udemy and the truth is, we’re talking about >20% of our income from the businesses at the end of the day. Losing those instantly would sting initially, but then we’d recover pretty quickly.
And that’s totally by design because I’ve been burned in the past.
Back about ten years ago, I got slapped two or three times by Google. Not for overtly breaking their rules, but because they changed their rules AFTER the fact which is totally within their terms of service oddly enough.
Yes, Google can ban your AdWords account for ads that you created in the past, they took your money for, showed the ads but then at some future date decide that the content of the ads violates their terms. How weird is that?
Anyway, having been stung by these crazy things in the past, literally through no fault of my own, I decided not to take the risk.
I have been willing all the way through the last ten years of running my online businesses to leave some money on the table with respect to third-party platforms in an effort to focus on building my own platforms.
That’s always been the priority – build my own platforms.
I never wanted to be a digital sharecropper.
The hard part is, the allure of some of these platforms and marketplaces is quite strong – you publish some videos on YouTube, you get some traction, you get enough subscribers to turn ads on and now you’re making some money. You keep making more videos, get more views, make more money. You invest in higher production values so you need to make more videos to get a return.
Before too long, you have a job making videos for YouTube where at any time they can turn the tap off.
You could easily replace “YouTube” with “Udemy” and it would be the same thing in that respect.
Does that mean you shouldn’t use these platforms?
Of course, that’s not what I’m saying.
I think YouTube is a great distribution channel for your content. But the goal should be to drive people back to your platform, not hoping they click ads so you can get pennies on the dollar.
Udemy is a great distribution channel for your video training products. They can drive significant volume to your courses and while the price point is low, if you’re successful they can deliver enough volume so that it’s worthwhile. Ultimately though, you should be trying to turn your audience on Udemy into a community that starts following you so that you can have a better relationship with them.
It is very easy to fall into the trap of being a digital sharecropper.
Just remember, your priority should always be your online business, not someone else’s and you need to make sure that permeates every decision you make.