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Why Nintendo's Creators Program is Bad News

The Nintendo Creators Program is bad for everybody but Nintendo.

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Hey, folks I'm Rojo, a hobbyist game developer, and one of the many, many people creating let's play and other gaming videos on the internet.  There has been a long standing battle between some game companies and YouTubers about who's allowed to make money off of let's play videos.  At a glance, it seems like Nintendo is trying to strike a middle ground by giving YouTubers a license to create video content using their games in exchange for some of the ad revenue, and maybe that really is their goal, but the current implementation of the Nintendo Creators Program is extremely one sided.

Are Game Developers Owed Anything?

Before we get to the details of the program, let's address the elephant in the room.  Many companies, Nintendo included, think that they should be getting a share of the ad revenue from let's play videos.  Many people agree, arguing that you can't legally upload movies or music, so why should you be able to do so with video games?

Tell you what, let's do a little experiment.  Load up your favorite game and jump into a level.  Now put down the controller and look at the screen for a good 30 seconds.  It's not very interesting is it?  It feels like something is missing, right?  Let's try again, except this time, pick up the controller and play the game a little.  Ahhh, that's much better, don't you think?  That's the point – video games are worthless without user intervention.  Interactivity is the hallmark of the format.

You might say, “But Nintendo is acknowledging that by sharing the ad revenue with you!”  Well, OK we can explore that route.  Let's consider another type of digital media and apply that principle.  Think about Adobe Photoshop.  Most of you have probably at least heard of it.  Similar to the game, it's not very interesting by itself, and similar to the game, it becomes a lot more interesting with a little user intervention.  But wait a minute now.  If I sell a masterpiece of artistry created using their software, isn't Adobe entitled to a cut of the sale?  Naturally you would say, “Of course not!”  I agree with you.

So what's the difference?  Well, the short answer is that there isn't one.  A video game and Photoshop are both examples of interactive digital media.  In the context of a let's play video, the game is the canvas, the let's player's voice and controller are brushes, and their every word and button press a brush stroke.  After paying the subscription fee, I don't owe Adobe a dime for the content I create using their software, and similarly my financial obligation to Nintendo ends when I purchase a copy of one of their games.

How does this relate to the argument that let's play videos should be treated as movies or music?  Empirically, I showed you earlier that games don't have any value without user intervention.  This isn't the same with movies and music – they aren't interactive forms of media, and their only value comes from the watching and listening.  If you're just wholesale uploading a song or a movie to the internet you've created nothing, and you certainly shouldn't be making any money off of your upload.  Point being that you can't draw a comparison between the upload of non interactive form of media such as a movie or song and an upload of a video of an interactive form of media such as a let's play video which by its very nature has original gameplay and in most cases original commentary.

Creators Program Nitty Gritty

Now that we've established that morally and intellectually speaking, game companies have no right to a cut of a let's player's profits it seems almost unnecessary to go into the details of Nintendo's Creators Program, but let's take a look anyway.  It seems simple enough at first – Nintendo grants you a limited license to create video content for some of their games for a 40% cut of the ad revenue on a per video basis, or 30% on a per channel basis (we'll come back to this in a moment).  That's not bad, right?  You pay your protection money and nobody gives you a hard time.  Let's dig a little deeper, though.  First off, Nintendo can arbitrarily change the percentage cut they share with you.  In addition, YouTube is already taking 45% of the ad revenue right out of the gate – a monumental tax considering the quality of the service provided, but that's a discussion for another article.  So now a let's player whose entire channel is registered with the program is only getting 38.5% of the ad revenue share.  That's quite a dip.  It gets worse, though.  If you register your channel into the program, Nintendo gets a 30% cut of your ad revenue from ALL of the videos on your channel, regardless of the content.  Yeah, let that sink in.  What if Ubi, Activision-Blizzard, and EA all implemented a similar policy?  It's clear that this is neither well thought out or sustainable.  If you don't want to register your entire channel and let's be honest, who would, you can submit videos individually by allowing Nintendo to take an extra 10% of the revenue share.  However, according to the Terms of Service, it can take up to 3 days for an individual video submitted to the program to be approved, which is logistically damaging to people who rely on releasing timely content to generate views and revenue.

Still not convinced that the Creators Program is bad news?  Take a look at Section 3 of the terms of service.

You hereby grant Nintendo a perpetual, worldwide, non-exclusive, royalty-free, transferable, license to use, reproduce, distribute, display, stream, publicly perform, publish, adapt, make available for transmission and modify the Videos for purposes of promoting, advertising and marketing the Nintendo Creators Program and Nintendo hardware, software, products and services.

 

It's the ultimate hypocrisy!  A slap in the face to every single let's player out there.  What this says is, it's OK for Nintendo to use a let's player's hard work to profit, but not the other way around.  By the way, if you don't think making a quality let's play video is hard work, try it for yourself and compare your results to some of the big let's players out there.  I guarantee it will change your mind.

But wait, there's more!  If Nintendo decides to shut the program down for whatever reason, you must, at Nintendo's request, delete all of your video content that they granted you a license to use.  That could be years of hard work down the drain all at Nintendo's whim.  Even if they don't make such a request, they will take 100% of the ad revenue from the videos in question.

We have a few more things to cover about the program itself, and they're critically important.  First off, if you have ever been part of any “antisocial forces” Nintendo will deny your application or remove you from the program.  Did you use that Gamer Gate hashtag once?  Better find some new games to let's play, because it doesn't matter what you think about a movement.  What Nintendo thinks is all that matters.  This plays into the final nail in the coffin for the Creators Program.  Nintendo must approve your content, and anything that they find objectionable will be denied.  Oh, did you want to post a not-so-favorable review of the upcoming Zelda game?  Good luck if you're a part of the program.  By the way, if you need legal counsel to protect yourself, I hope you have a lawyer who's familiar with the law in Kyoto, Japan, because that's the region that has jurisdiction over the program's agreement.

Fair is Fair

That brings us to the final part of this article.  I want to talk briefly about fair use.  There are four markers that are taken into consideration when deciding whether or not fair use is applicable to a work.

The first is the purpose and character of your use.  That is to say, is the work transformative?  Has any value been added to the original?  We demonstrated earlier in the article that without user intervention, video games have little value.  Every tap of a button or rotation of a joystick creates an original experience.  Add in a let's player's commentary and you certainly have a transformative work that's purely value added.

Next, we must consider the nature of the copyrighted work.  We don't really get any points here since games generally aren't informative in nature.  However, the let's plays themselves generally are, often showing how to accomplish something in the game.  Beating a boss, finding a secret, or how to build a character are just a few examples.

Third, we need to consider the amount and substantiality of the portion taken from the original work.  Let's plays tend to show off the entirety of a game, but what really matters is whether or not the content used is the heart of the work.  I put forth the argument that interactivity is truly the heart of any video game.  Watching a let's play video, with or without commentary, will never be the same experience as actually playing the game for yourself.

The final thing we have to consider is huge!  It's the potential impact of the work upon the market for the original.  Again, watching a video is not the same as actually playing the game.  More to the point, the fact that Nintendo has created this program to begin with is an open admission that let's plays are good for business, especially since they're so worried about controlling what gets approved and what doesn't.  Ask just about any indie game developer and they'll tell you that they'd kill for a chance to get some exposure from a big YouTuber.  It's not any different for AAA developers, without a doubt.  Let's plays are a source of totally free exposure for a game, and that should be payment enough for any developer.

 

References:
https://r.ncp.nintendo.net/guide/
https://r.ncp.nintendo.net/terms/
http://fairuse.stanford.edu/overview/fair-use/

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