YouTube gaming stars blindsided by Nintendos ad revenue grab

Nintendo wants a cut of the ad revenue from gamers who post videos on YouTube that feature their games, but gamers question whether publishers are after their earnings or simply want to control the message. (Nintendo)

Nic Truong of Mississauga, Ont. has a dream job: he plays video games and posts clips of them on YouTube for his fans.

But now, Nintendo is asking YouTubers like Nic to hand over at least 40 per cent of their ad revenue for any video starring Mario or Link.

Truong, better known as TetraNinja, has built a following of more than 800,000 on YouTube by providing play-by-play commentary on video games. These clips are called "Let's Plays," and they're some of the most popular gaming-related videos on the internet.

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Nintendo games hold a special place in Truong's heart.

"The original Legend of Zelda on the [Nintendo Entertainment System] was the very first video game I played," says Truong, who credits the popularity of his channel to his 2011 series of Let's Plays of Zelda: Skyward Sword.

Nintendo's 'Creators Program'

YouTube videos generate money for the uploaders in several ways, but most of them are tied to ads - either "pre-roll" ads that play before the clip, or banners that are superimposed on them. But a video creator needs to surpass a certain threshold before they get a cut of the ad revenue.

Several sources estimate that 1,000 views on a single video will generate around five dollars of ad revenue. Half of that goes to Google, and the rest goes to the creator.

Gamers like Truong, whose most popular videos have millions of views, are able to make full-time income from sharing their hobbies with their fans.

The gaming publishers have taken notice.

In 2013, Nintendo made sweeping copyright claims on videos on YouTube that included footage from their games.

"As part of our on-going push to ensure Nintendo content is shared across social media channels in an appropriate and safe way, we became a YouTube partner and as such in February 2013 we registered our copyright content in the YouTube database," Nintendo said in a statement in 2013.

The copyright claims meant that all ad revenue that previously would go to the creators of the individual videos went to Nintendo instead. It caused a significant backlash in the Let's Play community. Eventually, Nintendo dropped the claims. 

The company's new initiative, unveiled in January, proposes to share the revenue for some videos.

YouTubers can apply to the Nintendo Creators Program and if an approved channel's video contains footage from a list of approved games, the revenue is split between the two parties – 40 per cent for Nintendo and 60 per cent for the creator.

If Nintendo chooses not to approve a video, then it can claim 100 per cent of the ad revenue, as it attempted to do in 2013. So far, it's not clear why some videos are approved and some are not.

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