How Much do YouTubers Actually Earn?

YoutubeMoneyI see a lot of wild speculation about how much money the big YouTubers earn, how rich they are (and apparently greedy).

Well I’ve done some research and here is what I’ve come up with. So let’s take the current top YouTubers, Smosh, as an example.

It has been estimated that they earned around $1 million in 2012. They are part of a network called Alloy. Most networks take a 40% cut. YouTubers like Smosh also pay a production crew of around 10 people, and of course they also pay taxes.

Let’s do some math:

$1,000,000 in gross revenue x 0.60(after their network's cut) = $600,000.
Let's say their crew only works part time and earns about $15,000 per 
person (give or take) x 10 = $150,000
So then, $600,000 - $150,000 = $450,000.
$450,000 * 0.60 (after state, federal and self-employment taxes) 
= $270,000
$270,000  ÷ 2 (Ian and Anthony are 2 separate people) = $135,000 each.

So at the end of the day, while their YouTube channel may actually bring in $1 million, the individual members of Smosh only keep $135,000. That’s still quite a decent income, but hardly makes the rich and/or “greedy” in my opinion.

Who is really getting rich off of these big YouTubers? Google/YouTube and their affiliated networks are. In fact I would like to posit that Google/YouTube and the various YouTube networks are exploiting these big YouTubers for profit.

All my calculations are, of course, complete speculation and rough educated guesses. I, myself, am also self-employed so I know how much tax they would be paying, but I don’t know if big YouTubers like that are able to negotiate a better profit split with YouTube and/or their network, so they could be bringing in more money. However the bigger a YouTuber gets, the larger their production staff seem to be in order to produce bigger and better videos (Phil DeFranco and SourceFed come to mind – that organization keeps growing).

Bottom line, my point is, don’t be so quick to judge someone who is successful, and label them as “greedy.” There are a lot of factors to consider between someone’s gross income and their actual net income at the end of the day.

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