Twitch Issues Public Apology After Receiving Backlash Over Branded Content Changes

Twitch revoked its new branded-content guidelines a day after setting them up, following a backlash from creators. The new guidelines were supposed to take effect on July 1.

Backtracking Branded Content Changes

Amazon-owned live streaming platform Twitch released the branded-content guidelines to restrict different kinds of ads allowed on the platform, including the band of burned-in videos and on-screen logos that will maximize 3% of the screen size. However, Variety reported that Twitch reversed these rules after receiving backlash from its creators.

In response to criticisms, Twitch released an apology statement on Wednesday and said: "Yesterday, we released new Branded Content Guidelines that impacted your ability to work with sponsors to increase your income from streaming. These guidelines are bad for you and bad for Twitch, and we are removing them immediately."

Twitch explained that sponsorships are critical for the company's growth and the streamers' ability to earn income. Thus, they released the new guidelines. But as they understand the creators' arguments, the streaming platform promised not to restrict their ability to enter into direct relationships with sponsors and will continue to support them.

Twitch Receiving Backlash

The new changes were supposed to impose intense restrictions on the in-channel sponsorships that many streamers rely on for their income on the platform. As Twitch released the updated guidelines last Tuesday, TechCrunch reported that the backlash was loud and clear, slamming the company for the abrupt shift in branded content rules.

Through its standard revenue-sharing agreement, Twitch takes a 50% cut from creators' earnings. However, they cannot get a share of deals that streamers negotiate with sponsors and advertisers. Many creators viewed the company's sudden changes as a way to insert itself between streamers and their sponsors.

Creators usually rely on advertisements and sponsorship to fill the monetization gap, as the economics of streaming is not that good for creators. They regularly display "burned-in" advertisements onto streams, whether through display banned, video commercials, or audio. The supposed changes would have prohibited all these ads except the 3% logo size rule.

Aside from the supposed abrupt changes, creators also argued that they were not consulted on the changes in the content guidelines. Game Spot reported that Twitch then agreed to "rewrite the guidelines to be clearer" and would update the community once they were done.

Amazon recently made mass layoffs at Twitch. The company acquired Twitch in 2014. Last March, former Twitch CEO Emmet Shear resigned after 16 years. Following the departure of former COO Kevin Lin in November 2020, Shear was the only co-founder who remained at the company.