Numlock Sunday: Julia Alexander on the most dominant cultural force in our entire media ecosystem
By Walt Hickey
Welcome to the Numlock Sunday edition.
This week, I spoke to Julia Alexander who writes the wonderful newsletter Posting Nexus. Here's a recent Numlock appearance:
Epic Games, the company behind Fortnite, announced the state of its creator business, where the now 70,000 users who designed some 200,000 unique in-game islands for players can get paid for their efforts depending on how they’re used. This means that some 60,000 creator-made islands are played each day, and some of them are making a real killing on the hobby. According to Epic, 12,909 creators cleared over $100 in payouts from their work in 2024, while 418 managed to make over $100,000, 37 cleared $1 million, and seven creators managed to make over $10 million from their work. While Epic paid out $350 million to creators last year, it’s getting its money’s worth: Players spent 5.23 billion hours playing on creator-made islands, 36.5 percent of total Fortnite playtime.
Julia’s brilliant, her newsletter is all about attention and where we allocate it, she has a really keen eye on media and the ways we consume it and whenever we chat I feel like we could talk all day.
We spoke about the evolving economy of user-generated content online and the increasingly apparent friction between people who are skilled at making things for the internet and institutions that are built for centralizing and commodifying content through existing (lucrative!) channels.
Julia can be found at Posting Nexus.
This interview has been condensed and edited.
Julia Alexander, you write a favorite newsletter of mine called Posting Nexus. Thank you for coming back on.
Thank you so much for having me, that is extremely kind of you.
Oh no, it's so good. We just had you recently in the newsletter about your incredible story about Fortnite and the user-generated content there that I thought was actually really interesting in terms of just how much these gaming companies are actually getting out of people making games. Did you want to talk about how games became platforms for other games and what that kind of means for their economics?
Yeah, and let me set this up for people who may not know what Epic announced. So Epic Games (who owns and publishes Fortnite), they started a program, a creator program, that's part of their Unreal Engine. This is a game engine that they own. Basically, they gave creators the ability to go in and make islands within Fortnite. People, other players can come to these islands and play these different games.
If you've ever played a Grand Theft Auto 5 mod or like a game within Roblox, you know exactly what these look like. And Epic is catering more and more to these types of in-game experiences. And they announced that they actually paid out more than $350 million to these creators in 2024, which was up 11 percent compared to 2023.
More than 37 creators were paid more than a million dollars. And they actually had seven creators who collected more than $10 million as part of those payouts. I thought, you know, it's super interesting. There were nearly 200,000 in-game islands for players to experience, which was up an astounding like 60 percent year over year from when they were kind of looking at it. And what was really interesting to me was as I was reading through Epic talking about this and the effort that they're putting into these creator-made in-game experiences — which by the way, is such a huge turnaround from what the gaming industry used to be, right? When mods were basically seen as a copyright infringement and you'd have all these companies like Rockstar (who does Grand Theft Auto), like Nintendo, kind of coming out and saying, “Look, you can't do this.” And they would shut them down.
What really spoke to me is that this is just a YouTube strategy. Inherently, what this is saying is “We understand that as power laws that surround media come into play, the number of platforms that see the most increased levels of engagement are going to become much fewer as we go forward.”
The idea of saying you're gonna have 10 platforms might become one platform. At Epic Games and their team, when they look around and see what's happening, they're looking at time spent within a game like Roblox increasing. They're seeing in-game spending within a game like Roblox increasing. They're seeing their game kind of stagnant in terms of levels of players that are within those games. And they're saying, “Well if we can't just build ourselves better or more enhanced games for people to enjoy, what if we gave individual creators the ability to build within it and we're going to share within the monetization of it?”
I think that to me was really interesting. It was the first time that a non-UGC or user-generated content platform or industry like gaming is taking direct lessons from YouTube, which is now the most dominant cultural force within our entire media ecosystem.
Yeah, it also feels like, it's a bit of a throwback too, because it’s almost like, you want to talk about whose business model they're taking. This is what McDonald's looks like, right? Franchising out, letting other people do the work for you. This is a very interesting kind of step for the gaming industry that, as you mentioned, used to detest this kind of stuff.
If you go back to like the late 1800s, early 1900s, which is where I'd spent a lot of my favorite media time, you kind of see the birth of the centralized media environment that we're currently in. This was in part due to the government realizing how important communication through things like telephone, but as well as radio and television, was going to be to Americans. They said, we need to have a system that works. You need to be able to oversee and regulate a lot of events. You see companies like AT&T back in the day come in and kind of own companies like NBC Universal before they got rid of it and divested it many, many years down the line. There's this world in which all the media that we're used to came up within this centralized environment.
Ironically, while all this other decentralization was happening — to your point about like franchising of fast food restaurants, which are still within this one corporate bucket, but are existing within different management, within different owners in order to kind of feed the gigantic octopus bringing to the top of it — media was never like that. What we saw happening was streaming and then what we saw happening with the user-generated content, and of course, which all stemmed from the internet was the first time that we saw and gave access to this kind of democratized, decentralized environment.
What happened within that was the earliest people to realizing that if you are going to take attention given… If you're gonna take all this attention that's being given to you and find ways to increase the monetization which typically comes from advertising, which means you therefore have to increase the number of people coming to your platform each day. The best way to do that was not to necessarily go out and hire Hollywood actors and pay them a ton of revenue or give them a lot of money and figure out health benefits, whatever it might be. The best thing to do was just to split some of the monetization with this army of creators who were coming up.
All of a sudden, you've got a platform like YouTube, which is really. It's not even the first video platform on the internet, but it's the first one to say that we're going to be a galaxy. And within this galaxy, there are different stars and different planets that we are going to basically ensure within our umbrella. As we build it, we're going to ensure that creators are coming to our platform because they're incentivized to do so because we have the best ad payout. And with all that level of attention, we're going to be the dominant form of advertising– or the dominant form, sorry, for advertisers to come to.
Fortnite and Roblox are just the realization of that, of saying like, okay, well, if we can just be the galaxy, then we can have all these different islands and they're still contributing to the giant octopus that is our major corporate revenue. They're still contributing to our bottom line. We're just splitting it with them as opposed to having to hire hundreds of developers to then go and build something that we're not sure will even work.
Yeah. You just reminded me of another post that you wrote about Mr. Beast and essentially the attempt to procure a show on Amazon after really kind of dominating YouTube.
I have been very, very, I guess, I'll just say enchanted by this phenomenon: all of the YouTube-originated, sometimes influencer-type of performers all want to be doing movie star deals while all the movie stars, like Reese Witherspoon and whatnot, are all trying to become relatable people on Instagram.
And you talk a little bit about some of that idea and that story, but again, that's a really selling example of this trend that you're talking about. What's going on with that?
The creators don't need the traditional players so much as the traditional players need the creators. If you look at someone like Mr. Beast, whose show came out on Amazon, it did pretty well for Amazon. It was one of their top-performing unscripted shows. It landed in the Nielsen top 10 weekly streaming reporting, which is a very good astute measurement of kind of attention and viewership across all these different platforms. Now that it's not all within one kind of centralized pay TV or broadcast system.
For that to land within the top 10 was really important for Amazon. For it to be a number one unscripted show was really important. I made the argument that if Mr. Beast could convert like 10 percent of his huge (like hundreds of millions of subscribers on YouTube), over to Amazon Prime Video engaged viewers, it would be a really strong success for Amazon. Especially so when you consider that Amazon decided to lean into an opt out strategy for its new advertising program. Which means that if you're a Prime Video subscriber and you don't want ads, you have to actually opt out of it as opposed to opting in, which is what a lot of the opt-out other streamers have done. Which means Amazon Prime Video overnight became one of the largest aid bots in the world, right? There's a huge amount of advertising money. Advertising money is increasingly going to be dependent on the amount of viewership you have. If creators can bring those audiences over, it's really important.
But what was interesting about that was I would argue that the show was a failure for Mr. Beast. Like that show did not, it wasn't a huge performer. That show gave him a lot of money to do something that he probably could have done on YouTube. He was gonna get a lot more help with it. It didn't really expose him to an audience that was going to necessarily follow him over to YouTube. And in fact, the reviews around it were pretty negative outside of his core fan base, which is to be expected for his fanbase to be very supportive.
And so it didn't actually help Mr. Beast. And it may have harmed him, but I think what really, what that spoke to is trying to combine these two worlds, trying to combine the YouTube world with the traditional world, doesn't necessarily work. The incentive for the YouTubers aren't there, other than straight-up money upfront. Saying like, “Hey, we're gonna give you this amount of cash that you might not be able to get elsewhere.” Mr. Beast can use that to invest in his other projects on YouTube. He can use that money to invest in other companies that he wants to fund, which is what he's been doing.
You're seeing it now with the Paul brothers. So they have a new series on Max. You're seeing companies like Netflix who are partnered with Sidemen out of the UK. And for these YouTubers — who for a long time, the end goal was getting back to traditional television in Hollywood — actually, they're doing these companies a favor.
The hard part for these companies, with the exception of Mr. Beast (which has always kind of been spectacle-driven,) is that these creators are not necessarily interesting within that 30-minute to 60-minute setting. They're interesting within a 15 to 20-minute setting. They're interesting when they can kind of control the character that they're portraying. And that doesn't necessarily flow to a more traditional style of television, which is not necessarily spectacle-driven. It is very character-driven.
It's very much based within this kind of more rigid format. And so I think the question of “will we see more creators on streaming” is yes, because it's beneficial to the streamers. But I do think you'll start to see that a lot of these creators don't necessarily need to be there.
And as the value of traditional television continues to potentially diminish amongst the Gen Z, Gen Alpha audience, you'll also see stronger disincentive for those creators to stop putting stuff out on their own platforms to focus on bigger projects for an audience that may not be as relevant or important to them.
Yeah, that's interesting. I love that insight that like, there really is a stylistic difference between 30 minutes– Obviously like we know that there's a difference between like 30 minutes and an hour, which is why we put comedies in one and dramas in the other. But like there's a phenomenal difference between any of this kind of YouTube-oriented, “as long as it ought to be, potentially rather short, in fact.” And a mismatch between that and kind of what these existing companies are accustomed to.
Yeah, I think that's why, for example, if you look at like the Paul brothers, they work in their post-YouTube — I would argue they're in their post-YouTube era, very much so. It's why they work in their current roles: Logan Paul plays a heel on WWE. And he's spectacular in that role because he's played the villain for so many years. He's also a podcaster. And so he gets to kind of just be himself and talking to a microphone, but he's surrounded by his friends and he's bringing in other creators. And so that collaboration aspect is still there. Jake Paul has become a boxer and he gets to kind of play this hated boxer, but he seems to be a talented athlete.
They've taken what was essentially this goal on YouTube to keep one-upping their level of spectacle; what they've done is remove the need to do that every single day or every single week. Now they've put it into venues and arenas where that level of spectacle, of being one-upping, whether it's WWE or whether it is boxing works for them at a much higher level of revenue. That is not true for the vast majority of YouTubers, which is why you're seeing it's much more difficult for them to make that jump over.
And also the question of like, “Will a new audience who doesn't care about these YouTubers, or will that YouTuber's current audience, go to a platform that they don't already have?” So like, take out Netflix and they're going to like a Peacock or Paramount Plus. We actually don't know, especially when access to these creators is super open. I think when we look at the incentive or disincentives that really surround some of these deals, the creators for the first time in a long time have a very, very, very strong advantage over the kind of traditional multi-billion dollar system that is centralized Hollywood.
Fascinating. I guess just to kind of back it out and wrap it up, all this conversation that was based on a couple articles that you've written on your outstanding blog, Posting Nexus. It's all about attention. I've just been such a big fan of it since you launched it last year. Can you tell folks a little bit about it, what you've been up to lately and what you’ve got coming up and maybe where folks can find you going forward?
Oh, that's so nice of you. So Posting Nexus is really about where and why we give our attention. And so when you think about that, that kind of boils down to entertainment, gaming and user-generated content. And within that realm, the incentives and disincentives to participate in those structures, both voluntarily and involuntarily. So that's everything from streaming to Fortnite, as we were just talking about, to YouTube and TikTok.
Next week, as we're talking about this, I have a piece coming up, kind of looking at how copyright and generative AI is going to affect both the films that you see in Hollywood (the type of films that you see) as well as the type of content that appears on your YouTube feed, and kind of the incentive structures and the monetization around it for a lot of people getting into it. The way I like to think of Posting Nexus is: If you're looking at your screen and you're giving your attention to something, if you stop and ask yourself, “Why am I doing that” or “Why am I participating in it?” That's what I spend a lot of my time thinking about.
It's on Substack, at Posting Nexus. And I am unfortunately still on Twitter mostly, @loudmouthjulia, but also on LinkedIn, because I'm in my 30s. So that's where I am.
Hell yeah. I mean, LinkedIn, that's the rare social network where they actually let people click on stuff, so. All right, well, hey, thank you.
Thank you so much for having me.
Edited by Crystal Wang.
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