A study recently published by Oxford Economics, conducted in partnership with YouTube, assessed the economic impact of the platform on the Indian economy. It reveals that the YouTube creative ecosystem contributed more Rs. 6,800 crores to the country’s GDP, which is just short of $1 billion. This is a figure which has witnessed enormous growth year on year over the last few years and it appears as though more and more Indians are finding ways to earn money on their own via the internet.
The report believes that YouTube is responsible for creating the equivalent of nearly 7 Lakh full-time jobs. About 40,000 channels have over 1 lakh subscribers which is a 45% increase from the year before. Of these, more than 4000 channels can boast over a million subscribers, which is itself a 50% year-on-year increase. The number of channels earning at least a lakh in revenue has also increased by 60%. Such figures tell us that the growth of the Indian presence on YouTube is still very much in the early stages, and we are likely to see even more channels utilise the earning capacity that the platform provides.
The estimates calculated by the report take into account both direct and indirect impacts that YouTube has and how this leads to a growth in jobs and income. The direct impacts have to do with ad revenues, payouts from channel memberships, royalty payments in the case of music, and so on. Indirectly, YouTube also helps generate income as creators need to spend money on their channel in terms of equipment and software. The larger channels also need to hire editors, designers, producers, etc. and as such, there is a long supply chain through which money is spent.
One of the reasons why we are seeing such high growth figures currently likely has to do with the pandemic. The report cites many channels that looked to YouTube for income as their primary sources dried up as a result of the lockdown. Channels, however, are reliant on YouTube’s algorithm to promote their content. They generally need to wait for one of their videos to go viral and generate a lot of views before the subscribers start pouring in. It is only then that channels begin to invest and can actually grow their subscriber base as there is some sort of revenue stream to tap into.
The rise in YouTube’s contribution to the Indian economy also coincides with India’s increasing usage of the internet. As Indians become more comfortable with engaging with the internet, they are also figuring out how to tap into the resource for income. This is not only the case with YouTube but also with other platforms like Urban Company, Uber, Swiggy, etc. There is a difference between these platforms and YouTube, however, as Uber, Swiggy, etc. are filling in the gaps in an existing industry. YouTube on the other hand is providing an entirely new alternative which is in effect expanding the industry of content creation which was once restricted to only a small group of people.
As the digital economy grows, it will be important for regulation to keep pace. We have already seen the kind of issues that employees at organisations like Zomato, Swiggy, Uber, etc. face in terms of a lack of labour rights. With platforms like YouTube, content curation policies will have to be reviewed. By and large, the Indian YouTubers create content on everyday topics such as music, beauty and hair care, education, tech help, etc. There will, however, be content that might pose a problem to the public discourse, as we have already seen with the likes of conspiracy theorists, political extremists, and so on. In a coutry like India, where the line between what is admissible and what isnt is not so clear, YouTube will have to come out with its own standards that it abides by consistently.
The structure of the Indian economy is changing. Online platforms are giving people new ways to monetise their skills/talents and this is tapping into a previously unexplored area of the economy. While growth will continue to accelerate over the next few years, it will be important for the government to pay attention to how these changed are affecting the people who are involved. Adequate research and planning will be necessary so that regulation protects individuals from being exploited.