Talent Tube: how Britain's new YouTube superstars built a global fanbase

They are Britain's new screen superstars -- a generation that has built a global fanbase (and a chunky living) on their YouTube channels. So why would they need old-style TV stations?

Late on a Thursday night in October 2012, Jamal Edwards is sitting cross-legged on the floor of Ed Sheeran's south London flat, about to interview him. Sheeran is tired: the singer-songwriter, whose debut album, +, has gone quadruple platinum in the UK, is exhausted after a flight back from a US tour and an evening filming The Jonathan Ross Show. But Sheeran feels he owes a lot to Edwards, so he's making time as the 22-year-old clears some space on the memory card of his SLR camera, time which he spends teasing Edwards: "Jamal's too big now; he just gets other people to film."

As YouTube has grown -- 800 million people now visit the streaming site each month and 72 hours of video a minute are uploaded -- a new generation of British media talent has grown up with it.

When YouTube started, they were kids. Now they're taking on the entertainment industry.

Edwards uploaded his first clip to YouTube seven years ago, as a teenager living on an estate in South Acton. He had already been expelled from two schools: "I was very destructive," he says during the drive back to his Docklands home after interviewing Sheeran. "I have a very short attention span. But loved media -- I started MCing and rapping at school." Edwards's MC moniker was Smokey Bars.

In 2005, his mother, Brenda, who had made it to the last four of The X Factor that year, bought her son a Panasonic video camera. He used it to film foxes on his estate, put it up on YouTube under the username Smokeybarz and received a few thousand views. Edwards kept up the urban nature documentaries, but also started covering the local underground music scene, interviewing grime artists and asking them to play sessions for camera. "I just wanted to broadcast it," he says. "I set it up because my friends weren't getting mainstream success, and YouTube was an easy platform to share videos with them." Edwards hacked his school's internet server to show what he was calling Smokey Bars Television (SB.TV).

He left school with six GCSEs and started work at Topman, while applying for jobs as a runner at the BBC. His promises that he would make the tea and do any odd jobs to get a foot in the door went unanswered, but in the meantime SB.TV grew with the UK urban scene. Edwards interviewed Dizzee Rascal, Chipmunk and Mike Skinner, and on July 8, 2009, after applying several times, was accepted as a YouTube partner. This meant the site would equally split the revenues from adverts served against his videos, and he was sent his first cheque. "It was £100," he says. "But I was excited, like, 'Oh my God, I'm earning money off making videos.'" He helped break artists such as Tinchy Stryder and Wretch 32 into the mainstream, followed by acoustic acts including Ed Sheeran in February 2010. "It was the main thing that helped me take off," Sheeran says. "We met through Twitter and he came down and filmed me. At the time, it was a big risk for him - he was only doing grime."

Edwards was expanding his vision. In November 2009 he emailed Daren Dixon, CEO of AAB Talent Management: "What I'm trying to do is cross over on to the mainstream market as I dominate the UK urban scene at the moment... I've got an online YouTube channel called SB.TV which is quite popular here in London. I am an official YouTube partner, which is rare in London."

Edwards shared some stats to state his case: 11 million total views from 15 countries, 14,000 subscribers and 30,000 views a day -- "I had to show I was on my grind everywhere," Edwards says. The two swapped late-night IM and BBM chats, and in May 2010, Dixon booked Kelly Rowland for an interview with SB.TV. After that, mainstream stars such as Bruno Mars and Justin Bieber followed.

Edwards wasn't going to be making tea any more. He ramped up his ambition and his operation, hiring a managing director, then nine other people. He's since discussed business ventures with Richard Branson and interviewed David Cameron; Ed Miliband follows him on Twitter. SB.TV has had 130 million views on YouTube and 215,000 people subscribe to the channel. In 2012, The Sunday Times ranked Edwards on its annual Young Rich List at £6 million; SB.TV's revenues in 2011 were £110,000, and revenue from YouTube alone was worth £200,000 from January 2012 to October 2012. The company has also struck merchandise and brand deals with high-profile clients including Adidas, Nike and Sony.

Alongside his grime and acoustic channels, he's added comedy, sports, fashion, business, culture and a US channel. He's also looking at live events, including an SB.TV national tour and package holidays to Mallorca, Ibiza and Croatia. None of it would have been possible without YouTube, Edwards believes. "From where I've come from to where I am now... YouTube is so important. It's easily accessible and it can get you watched by millions." He once met Chad Hurley, a founder of YouTube, at an event in London. "He's the man. My mates were like, 'You're such a geek -- why are you getting excited?' and I said, 'Bro, show him some respect!' So we took him to Nando's."

Edwards is building a new type of television network. "It's not Smokey Bars TV any more: it's Self Belief, it's Stay Building. I'm going to revolutionise it."

He's not the only one. Charlie McDonnell created the channel charlieissocoollike in 2007 aged 16, while revising for his GCSEs, and began uploading video blogs. Now his channel has 1.6 million subscribers and he earns more than his parents.

He moved from his native Bath to buy a house in south-west London outright, which he currently shares with another YouTube success story, 23-year-old musician Alex Day. Day is not signed to a record label, but last year he went to number four in the UK singles chart with "Forever Yours", a self-released single he promoted on YouTube; he's generated more than 500,000 paid downloads of his music thanks to the platform.

Three years ago, Tanya Burr was working on makeup counters in Bramerton, near Norwich. She started posting make-up tutorials and was signed by a YouTube talent agency: "It's a full-time career for me now," says the 22-year-old. Sketch-writer and cartoonist Tom Ridgewell first started making web videos when he was 11 -- before YouTube even existed -- but can now boast 55 million views, 220,000 subscribers and an income of anything between £3,500 to £7,000 a month. In a similar vein, Luke Hood began what was essentially "a pirate radio-station based online", uploading dubstep music videos that he liked. The 20-year-old now heads up a team of 25 people, and his channel UKF has had one billion views and has sold 250,000 albums in the UKF Bass Culture series. These guys aren't waiting on a BBC show or a reality series on Channel 4.

For them, YouTube isn't a springboard into television and fame: YouTube is television.

Google, which owns YouTube, says that more than 1,000 people worldwide are earning at least $100,000 (£63,000) per year just from YouTube advertising revenues and a million YouTube users are earning money from their videos - a greater number than are employed in the US television industry.

Eight years ago, YouTube didn't exist.

Google bought YouTube for $1.65 billion (£1 billion) in December 2006, when the video-sharing site was less than two years old. It had 67 employees and had yet to turn a profit. The purchase became known as "Google's folly", and not long after the sale, wired US wrote: "You'd be forgiven for wondering how clearly Google thought this thing through."

The lack of a business model, though, was quite deliberate. In February 2005, PayPal alumni Chad Hurley, Steven Chen and Jawed Karim created a simplified platform for uploading and sharing videos. They called it YouTube and it bore the motto: "Broadcast Yourself". Unlike some of its rivals, it didn't charge anything or offer any financial reward for content creation. "We had a lot of competitors whose hook or selling point was that they could generate revenue for content creators," Hurley says. "We didn't want to create a barrier for people to participate in, and view this content."

By not pegging YouTube to a particular business model, though, its founders revealed "new patterns of attention among audiences, that came out of audience behaviour rather than a business policy", according to Matt Locke, a former commissioning editor at Channel 4 and founder of Storythings, a consultancy firm. "YouTube got there because it was a platform, not a channel. The difference is that if you're a platform, you're not making any assumptions about how people are going to use it. Because TV had such a dominant monopoly on attention in the living room, it had been hard for people to think that audiences might want to consume content in a different way." They did, though: users started to discover videos not from a channel schedule, but by social recommendations and organic search. Today, YouTube is the second-largest search engine on the planet, after Google itself. "Selling to Google was one of the best decisions we ever made,"

Hurley says. (Fox Interactive was also in the running: "I don't even want to think about that," he says.) Google did two things that turned it into a business, and eventually its own industry. First, it globalised the platform.

This meant that niche topics, ones that could never justify a channel in a single domestic market, had a global reach. Young creators such as Edwards, Hood and Burr started building audiences around particular niches, whether dubstep or makeup. They interacted with these audiences and responded to comments and video suggestions. This meant real-time audience feedback -- a form of A/B testing. "If it doesn't work out, you try something else," says Day. "The ability to interact with their audience is a critical part of their success," says Sara Mormino, director of YouTube content operations in Europe, the Middle East and Africa (EMEA). "It's a two-way dialogue that was not possible with traditional media."

Soon, the audience turned into users. And those users easily turned into creators. "When you watch all these people who are very much like you, there's nothing stopping you from creating the way they do. There's no harsh line between creator and consumer," says Hank Green, the founder of online video conference VidCon. "There's a really powerful social network around YouTube content creators," says Tim O'Reilly, the founder of O'Reilly Media. "Many of the channels are really helping each other to get off the ground."

For creators, it's simpler: "All my closest friends are You Tubers," Charlie McDonnell says, and as Ridgewell puts it: "Pretty much every British YouTuber knows each other. We all mash and interact. YouTube is not something you do on your own."

A generation has grown up with YouTube. When it started, they were kids. Now they're taking on the entertainment industry.

Most of all, the emerging stars of this new platform were authentic. None of them started out to make careers, they just wanted to share their videos. "When me and Charlie started, we weren't doing it for the money," Day says. "Everything we've got has been a side effect." McDonnell agrees: "It's one person in front of a camera, making a really honest connection." That connection helped make Justin Bieber an early YouTube celebrity. He presented himself as he was to camera, and millions of people "beliebed". When Eric Schmidt, then CEO of Google, now executive chairman, gave the MacTaggart lecture (an annual keynote address for the TV industry) in August 2011, he summed it up succinctly: "The internet... makes TV more personal, more participative, more pertinent. People are clamouring for it."

But YouTube was not making its creators -- or Google -- any money: in 2008, its revenues were $200 million (£126 million), but it spent $700 million (£430 million). Advertisers were unconvinced by a platform whose biggest hits included "Baby Monkey (Going Backwards On A Pig)", and users didn't like clicking on ads. Still, Eric Schmidt told Wired in 2009 that YouTube was attracting "an enormous, extremely large set of people who are spending an awful lot of time there. We will eventually figure out a very successful business."

Schmidt may already have had some idea of what that business would be. At a Super Bowl party in 2008, Microsoft employee Shishir Mehrotra had been struck by how his guests kept asking him to replay the Super Bowl adverts. Mehrotra wondered whether the idea could be applied online: could you show only the adverts that a user wanted to watch? His solution was video adverts that users could skip. Advertisers would pay only when a user chose to watch their advert, and therefore would get engaged, interested users.

Mehortra took his idea to Google and on 1 December 2010, TrueView rolled out. "It is one of the most important innovations," says Matthew Glotzbach, product management director for YouTube EMEA. "It's like taking a scalpel rather than a machete." Now, 65 per cent of YouTube adverts are skippable and, according to Enders Analysis, the cost per thousand views is often more than $15 (£9) -- two to three times the standard rate for non-skippable adverts.

Robert Kyncl, YouTube's global head of content, says that YouTube adverts now make more revenue per hour than US cable television. Enders Analysis says that, as a result, Google has now "more than made its money back from YouTube".

That lucre has washed through the system: OpenSlate, an online video consultancy, says that the average annual net payout to the top 1,000 producers is now $276,000 (£174,000). Mormino says that splitting ad revenues with content creators "is the base to generate revenue. The partner programme is a way to transform this creativity into something that is a professional career for people." YouTubers started making enough money from the platform to support themselves, and now a whole new video ecosystem of producers, agents and networks is emerging. VidCon, which started in 2010 with an audience of 1,000, hosted 7,000 people last year. "It felt like being at a Beatles concert in 1964," says O'Reilly, who attended the online video event. "Thousands of girls screaming for these YouTube stars as they walked out on to the stage."

Justin Gayner had worked in British television on programmes such as QI. In November 2008, he set up ChannelFlip, a network of YouTube channels. "I was privy to the audience figures for TV," he says. "I saw a big tide of activity on YouTube versus a dwindling amount on TV, and I thought, 'There's got to be a business in this.'"

Gayner's company now aggregates 136 channels across YouTube, working with native talent and also signing up content producers in traditional media. As of October 2012, there had been 1.4 billion views across ChannelFlip's YouTube properties, through 8.4 million subscribers. Gayner says his revenues have grown two to three times every year. "It's early days," he says. "But we're dealing with the largest audio-visual channel in history." In November, Base79, a UK company that now runs the largest YouTube network in EMEA, announced a funding round of $10 million, valuing the business at more than $30 million (£19 million). Dominic Smales runs Gleam Digital, a talent agency for social-media stars (Tanya Burr is on his books). "I still see this as seed planting - no one's getting minted," he says. "TV agents would laugh, but in two years' time it's going to be a different landscape. YouTube talent will be way more influential."

On the sixth floor of an orange high-rise designed by Renzo Piano in London's Bloomsbury, 30 or so young YouTubers (the oldest is 23) are hanging out. On the main set, dressed to look like a library from a period drama, another YouTube talent is acting out skits in homage to Tom Ridgewell, who is here to receive an award from YouTube for the millionth subscriber to his TomSka channel. "We all partake in a video-making experiment," says Ridgewell. "I'm here because I made a million people go..." he mimes clicking a mouse.

The jokes in the skits are sixth-form, because that's when most YouTubers started filming. But this video-production hub (which is free to any YouTuber who books in) is YouTube's attempt to grow its user-generated content into something more like professional television. The Creator's Space, which opened in May 2011, is the first of its kind in the world: there are editing suites, a stage with professional camera rigs and lighting, voice-over booths, editing suites and even a green room for special effects. "We're creating a whole new ecosystem of professional skills," Mormino says. She heads YouTube's Next Lab, which aims to unearth and develop new talent for the platform. "Our objective is to allow young people to refine their skills, help other YouTubers learn from each other, and enhance their creativity."

After being happy to let behaviours emerge on its platform, YouTube is now making efforts to steer them, as it moves from hosting amateur to more professional video. The Creator's Space is one part of that; its Original Channels are another. In November 2011, Google announced it was investing $100 million (£63 million) in 100 new channels, and it would give the money to creators -- who include Jay-Z and Madonna -- as an advance.

A month later, Google unveiled a redesigned version of YouTube, which put channels front and centre, and in October 2012 the company announced it was expanding the initiative to Europe, with another 60 channels. Many of those were pitched by native YouTube networks; ChannelFlip and Gleam Digital have both launched channels. But YouTube has also wooed traditional TV producers, with channels including ITN Productions and BBC Worldwide. "We're looking at it as an aggregated and editorialised platform where we can build up an audience," says Dan Heaf, managing director of digital at BBC Worldwide. "There's no doubt that YouTube is moving towards being a variation on the channel model." He says that digital revenue accounts for ten per cent of BBC Worldwide's turnover and adds, "I'm expecting this to grow quickly with initiatives like this." He also thinks it will allow the monetisation of BBC content beyond just selling ads -- whether through a subscription model or pay-per-view.

Ben McOwen Wilson is director of content partnerships at YouTube and led the recent European expansion, listening to about 500 pitches for Original Channels. "We see this as the third wave of TV," he says. "We're going to see tens of thousands of channels that are able to find their audience and build content specifically for that audience." The success of a YouTube video used to be measured by the number of views. At the time of writing, the latest sensation was PSY's " Gangnam Style", with more than 600 million views. But YouTube doesn't want to reward ironic K-pop: it recently tweaked its video-ranking algorithms to promote clips that keep viewers watching and engaged. According to the YouTube Creators blog post that announced the change, "this should benefit your channel if your videos drive more viewing time across YouTube." So if a You-Tuber makes a video that leads to a person clicking on another video and spending more time on the site, that video will rank higher. Conversely, the new algorithms punish videos that prompt cheap, quick clicks, but which don't keep a user interested.

In late 2012, YouTube rolled out its Project Hitchhiker redesign, aimed at making video and channel discovery easier. This redesign and the new emphasis on channels, are all part of Google's strategy to get people to spend more time on YouTube. According to a comScore report for May 2012, people in the US spend five hours watching television each day; they spend five hours watching YouTube each month. The way to be as successful as TV, YouTube reasoned, was to be more like TV. And with the Original Channels, YouTube isn't parking its tanks on the lawn of traditional TV, so much as inviting traditional TV to build its tanks for them.

In her MacTaggart lecture in 2012, Elisabeth Murdoch warned broadcasters: "Believe at your own risk that [YouTube's] platform is based on homemade videos of cats in washing machines or a dog called Fenton... Commercial broadcasters must figure out how to have a real one-to-one relationship with each and every one of their viewers -- if they don't, they are destined to become increasingly marginalised and dependent on occasional national live events."

TV, Murdoch was suggesting, should be more like YouTube. Shine, the production company that Murdoch founded and which News Corporation bought for £415 million, is investing in the new YouTube ecosystem: it bought Gayner's ChannelFlip in January 2012 and is helping with the startup's US expansion. And YouTube's emphasis on watch-time already seems to be working: the number of video views declined 28 percent from December 2011 to March 2012, according to comScore. But during the same period, users spent 61 billion minutes viewing videos -- a year-on-year increase of 57 per cent. Nielsen has reported that the average time spent per person watching TV has declined over the last four years, and during the same period, hours spent watching online TV has grown.

Ask anyone at YouTube if the company is aiming to kill traditional TV and they will make polite noises about YouTube being complementary. "YouTube is filling another space and time in people's days," says Glotzbach. Others outside Google agree. "YouTube invested $100 million (£63 million) in its channels -- that would make about 40 hours of original programming," says Lord Grade, who has served as chairman of the BBC, Channel 4 and ITV in his time. "How many hours a year do you think the BBC, NBC or CBS produces? $100 million is a drop in the bucket. I love watching YouTube, but will it replace TV? No. The demand for television content is not going to go away -- people will just consume it in a more uninhibited way, wherever, whenever they want." "It's not the death of television," says Claire Enders, the founder of Enders Analysis. "We know that for sure until 2020."

Seven years isn't long. "The notion of traditional TV is finished," says Michael Rosenblum, an online television producer and the founder of Rosenblum TV. "YouTube and internet video are not only going to encroach on traditional broadcasting companies; to my mind, they're going to destroy them. YouTube is just getting started. It's actually disappointing to me that they're going to channels, which is such an archaic, 1985-esque mentality of how to transmit video content into people's homes."

All this revolution will take is "one good product", according to Locke, one that sparks the mass adoption of smart TVs in the living room -- TV's lawn. "The big shift will be whether those online behaviours shift from laptops and tablets into the living room," he says. "As soon as we alter our behaviour in the living room to be about things such as organic search or social recommendations -- when you switch on your TV and see your subscriptions to channels, or a search box, or what friends are watching, the three ways that most people now use YouTube -- that's going to radically shift the position of traditional broadcasters."

YouTube is getting ready for that moment. In October, it quietly updated Leanback, an app that simplifies the site and makes it much more palatable for sofa viewing. The battle for viewers' attention is a zero-sum game: there are only so many minutes in a day. But TV versus YouTube may prove to be only an incidental skirmish in a much more important war for the living room, as technology companies compete for your time.

If, as expected, Apple launches some form of smart TV, and Amazon continues to focus on content-delivery devices such as the Kindle set, the struggle for audience attention will be fierce.

Those creating content aren't waiting to see whether broadcasters survive. "An industry professional gave a talk to our sixth form," Ridgewell says after receiving his award. "He said, 'I've been working in this industry for 40 years and I've just finished my first film.' I was like, 'Fuck that. I have to self-publish, I have to do this myself. I can't start as a runner and work my way up, I have to get it out there', and that's what YouTube allows. YouTube is where I want to be right now. It's evolving into this TV-esque thing, but you can't really compare it to TV because it's so new."

Ridgewell has turned down offers from traditional TV broadcasters such as Hat Trick Productions and BBC Comedy. "I'm having more fun here and not only do I have more creative freedom, I can earn more money." Day has a similar view: "I don't want to be in TV because I don't want to give up my control for no upside. That sounds harsh, but Charlie [McDonnell] gets more views than an episode of EastEnders, which is kind of weird." "The revolution won't be televised, it will be digitised," says Edwards. "Yeah, cool, I can do it on TV, but if I've done it online already, why do I need to do it on TV? I get the same amount of views, and I'm my own boss."

How to: create your own successful YouTube channel\1. Be authentic: "You shouldn't get into it unless you like making things, videos or music," says Alex Day. "If you do it to try and buy a house, then the internet detects that." \2. Be patient: "It takes at least two years to build an audience," says Justin Gayner, cofounder of Channel-Flip. You won't get rich quick: prepare for the long haul. \3. Collaborate: "A different person can bring in energy -- a fresh take or a different sense of humour," Day says. "And you can share audiences." And let's face it -- it's more fun. \4. Interact: "One of the most important things is talking to my subscribers," Tanya Burr says. "They feel like friends to me, because I chat to them every day." \5. Maintain the quality: One bad video a week is fine; two is "pushing it," says Tom Ridgewell. "Three bad videos and your audience is done." So keep tabs on viewer feedback. \6. See the bigger picture: Don't think of your channel in terms of content, says Ben McOwen Wilson: "Who's the audience? Why do they care about this, and how will it evolve?"

This article was originally published by WIRED UK