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Summary:

Metacafe has changed the payment conditions of its Producer Rewards program, lowering the the amount paid to video creators by more than half.

Metacafe has changed the payment conditions of its Producer Rewards program, lowering the the amount paid to video creators by more than half. According to a post on Metacafe’s blog today, under the new terms, producers accepted into the program will earn $2 for every 1,000 views. Previously, producers were paid $5 for every 1,000 views.

Additionally, Metacafe now explicitly excludes views from outside the U.S. from counting toward those producer rewards. So producers will only get that two bucks when 1,000 views from within the U.S. are reached. These new payment terms start Nov. 1 and will affect both new and existing program participants.

Echoing (almost the exactly) the words on the blog post, Michelle Cox, Metacafe’s communication director, told me in a phone interview, “The change is all about better aligning the program costs with our revenues. We are continuing to make sure that we are running the business in a prudent fashion.” Cox also said that Metacafe had been subsidizing the Producer Reward program quite heavily up until this change.

Metacafe’s newly minted focus on the U.S. is similar to an unpopular move made by Veoh earlier this year, when it blocked all but 33 countries from viewing its site. “Generally speaking, the advertisers that we are working with run U.S. specific campaigns,” said Cox. Translation: You good folks in France running up a video’s numbers aren’t really helping us earn money.

Cox says the company has paid out $1.5 million dollars to almost a thousand creators since the company launched the Producer Rewards program two years ago.

Metacafe employs 75 people across offices in Palo Alto, New York, L.A. and Tel Aviv. The company laid off 6 – 8 percent of its staff in Tel Aviv in the spring but hasn’t made layoffs since, according to Cox. In April of this year, both Metacafe founders, neither of which were involved in the day-to-day operations cashed out their shares in the company and left. (CORRECTION: Founder and chief creative officer Eyal Hertzog is still with the company)

The company has raised $45 million in funding, including a $30 million round it took in August of 2007. Cox says Metacafe is currently not seeking additional funding.

  1. Wow. The digital middleclass is a while away.

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  2. Producer Reward is dead and this is time to go now.

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  3. Sad to say it but it looks like the producer rewards program is dead. It was fun while it lasted but it is now time to move on.

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  4. Metacafe staff take too many bad decisions and kill the
    most popular Program on internet.Now Producer reward is dead.Now the best earning video site it’s Break.com.

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  5. What is upsetting producers more is that theses rules apply to videos that were already accepted under the old rules.. so producers feel their agreements are being broken.
    There were also new rules brought in February specifying the 20,000 minimum views needed to be within 6 months.
    At the time we were told that didn’t apply to videos submitted before Feb 2008 .. that promise is now being broken too…
    MC has lost the trust of many because of this.

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  6. The wrong decision in those area could be the most expensive mistake of Metacafe. …

    Here is my conclusions:

    Desicion 01: They just rely on their rating system, they want everything automatic, as you can see most of the videos in the front page are older than your mother. the same copy cat videos keep repating again and again… don’t you feel boring?

    Desicion 02: Do we really need wikicafe, how would you feel if the video you posted get amended by someone you don’t know?

    Desicion 03: Getting videos Based on API’s provided by YouTube.com is to tell people you are not the original?

    Desicion 04: When MC leading the world and telling people how great is the Producer Rewards System can change their life, now they going to Destroy it. you just killing the goose that lays the golden egg right?

    Desicion 05: You failed to deliver your promised. will you lost the trust of our Producers and viewers?

    If you say Break.com is more successful than Metacafe, I will definently agree with you, because they really know what people want to see about, they are very serious into their business, they hired somebody to make sure every video in the front page must be the newest and coolest.

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  7. [...] Metacafe has changed the payment conditions of its Producer Rewards program, lowering the the amount paid to video creators by more than half. [more] [...]

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  8. [...] move to halt payment for UGC isn’t surprising. In October of last year, the site chopped producer payments by more than half to just $2 for every 1,000 views that came from within the United [...]

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