---
title: 'Twitch Responds to the Adpocalypse: Will It Save Them?'
source: 'https://youtube.com/watch?v=XNaMGDnM10U'
video_id: 'XNaMGDnM10U'
date: 2026-07-23
duration_sec: 1352
channel: 'Devin Nash'
---

# Twitch Responds to the Adpocalypse: Will It Save Them?

> Source: [Twitch Responds to the Adpocalypse: Will It Save Them?](https://youtube.com/watch?v=XNaMGDnM10U)

## Summary

The video analyzes Twitch's response to the ongoing adpocalypse, comparing it to YouTube's earlier crisis. The speaker argues that Twitch's content classification labels are a lazy half-measure that won't satisfy advertisers because the platform's kingmaker system keeps controversial streams in discovery. He explains why political content is more toxic to advertisers than softcore content, and discusses the financial pressures from payment processors on NSFW content.

### Key Points

- **Advertisers pulling budget from Twitch** [00:01] — Advertisers are pulling budget from Twitch due to extreme content, and Twitch responded by removing ads from those streams, but the speaker argues this doesn't fix the discovery problem.
- **Content classification labels as a solution** [00:14] — Content classification labels worked for YouTube because offensive videos were demonetized and removed from discovery. On Twitch, even if a stream is demonetized, it still appears in top categories due to the kingmaker system.
- **PornHub analogy** [01:55] — The speaker compares Twitch's problem to PornHub: even if you categorize content, advertisers won't run ads adjacent to controversial material because they support the platform as a whole.
- **Need to deprioritize controversial content** [03:07] — Content classification is a good step but insufficient. Twitch must either ban all political content or create a separate category removed from discovery, similar to YouTube's approach.
- **Political content more toxic than softcore** [04:16] — Extreme political content is more toxic to advertisers than softcore content because it divides audiences, potentially alienating 50% of customers. Softcore content is less divisive.
- **Bank and payment processor issues** [06:12] — NSFW content faces higher transaction fees (5-8%) due to chargeback risks and bank regulations. This is why platforms like OnlyFans almost went safe for work.
- **Twitch Prime not converting young users** [11:55] — Twitch Prime was intended to convert young users to Amazon Prime, but data shows it fails because younger demographics use parents' accounts and have less disposable income. Groceries are Amazon's highest converting product.
- **Twitch Prime likely to be cut** [16:41] — Twitch Prime costs Amazon $20-50 million per month and has not proven effective as a conversion funnel. The speaker predicts it will be removed within a year.
- **Twitch's place within Amazon** [18:06] — Twitch is now under Prime Video, not AWS, making it a small line item in Amazon's balance sheet. The CEO of Amazon likely doesn't focus on Twitch.
- **Speaker's credibility and response to critics** [20:22] — The speaker defends his expertise, stating he has spent millions on advertising and built companies. He dismisses critics like Ludwig and Destiny as entertainers, not authorities.

### Conclusion

Twitch's content classification labels are a superficial fix that won't satisfy advertisers. The platform must either fully ban or fully isolate controversial content from discovery to retain ad revenue, but its position within Amazon makes it a low priority for drastic changes.

## Transcript

website is unacceptable we're going to pull budget or we or we have pulled budget and so twitch responds okay well now you don't have to serve ads this industry can help advertisers better align their ads with content that
content classification labels are actually the solution but the problem is well this worked for YouTube because with YouTube you had a situation where video is offensive not only is it
monetized but it's also taken out of Discovery and only relevant to the people that want to watch that content so a way to understand this is like if I'm Samsung and I advertise on YouTube there's no Universe where my ad appears
there's no Universe where my ad appears next to extreme or controversial content and this was the entire reason why there was an ad Apocalypse in 2017 on YouTube because YouTube couldn't differentiate
the content and even if you were to demonetize a single video Samsung's ad would appear on like content that was like adjacent to it but the problem with twitch is like twitch is trying to implement YouTube's feature
in like the most lazy way possible but the problem is that twitch is what's called a kingmaker system which means that the top viewership streams always go to the top of Discovery meaning that like a stream like a politics stream
with 20,000 viewers for example will appear in like top category of just appear in like top category of just chatting or recommended or Discovery right and so even if you demonetize the content from that stream ads will still
advertisers this is kind of the important part will still support that rhetoric so let me give you another example one that you guys have never heard of because I know that you guys are super upstanding citizens um there
is a website on the internet called porthub and that's a website where certain acts happen of questionable ethical and moral presence why don't ads run here like why doesn't Samsung run ads here right uh
it's not because they don't convert actually they convert quite well the reason is actually because and then let's say that like okay we as pH are going to categorize our content and you
can go into the category to see it uh and the rest of the website will be dedicated to cute kittens not those cute kittens not those kind um actual cats okay now advertise
please why doesn't this work it doesn't work because they have a system where if work because they have a system where if you run adjacent to the actual content that's on PornHub you are still like as an overall entity supporting what this
is now in exactly the same way if you keep Hassan obi's stream at 20,000 chatting or in recommended or in Discovery it actually doesn't really matter if you demonetize the stream itself because the content is still
there and so it doesn't really fix the problem at all I'm guessing that the currently angry probably they don't feel like it's fixed and if they don't feel like it's fixed it's because they're correct actually content classification
labels are a pretty good step but advertisers will not be satisfied with that just like they weren't satisfied with it on YouTube you need to actually deprioritize the content in terms of Discovery uh which goes back to my
Discovery uh which goes back to my Nuclear option either you ban it all or you let it all through if you ban it all you've got to drop out all of the other political broadcasters and people right and left and if you allow it maybe you
have to force everybody into that particular category you have to remove that category from Discovery and then you have to unban certain Mal contents like Destiny or other people have been banned and throw them all in the
dumpster that is the New Politics category but you cannot do a half measure that will not suffice so advertisers will continue to leave or probably won't come back isn't this just like the hot tub streamer issue it is
similar but the issue is a lot worse because extreme and controversial content in forms of politics is way more toxic to advertisers than softcore sexy content so like Americans are used to seeing a pair of boobs that's thinly
veiled that's that's that's kind of okayish and there are advertising there aren't but compared to like extreme content right or left that is super toxic to advertisers and think about why okay so let's just say guys I
my political view I've never told you all but I am a super left guy I'm the leftest of the left the uh the I'm I'm the leftist I'm so left that I'm right and then everybody is like everybody like you know maybe the left people are
but then there's some percentage of my audience also that's like right that's like hey that's not okay I don't agree with that thing so I'm angry now and I won't watch you or pay for your services right so the problem and what makes
political content so divisive and toxic to advertisers is that if you take a certain position you literally cut your audience in half right like if your audience was this and you know roughly 50% of the people are voting Kamala and
roughly half of the percentage of people are voting Trump right over here well you cut a line in half and now you just lost 50% of your people so if Samsung puts an ad on a stream that's really far right then that gets associated with
really far right values and the left hates them and vice versa and so the hates them and vice versa and so the problem is that like ads like but you so politics there's a huge divisive issue but everybody can appreciate boobs okay
not allowed to do anything like that in advertising because not safe for work not good the real problem with not safe for work and the reason why everybody is super not safe for work is actually because of banks it's because of payment
so federal banks are not allowed to pornographic transactions which is why you see like stripe go after only fans and stuff like that so the real reason uh like everything for why we are toxic
uh like everything for why we are toxic towards pornography is because of um money uh but the the the reason why we're toxic to politics is actually also money but scarier in that um I can potentially lose 50% of my Audience by
payment processor just dropped me because of that without advertising it at all kind of yep 100% exactly there you go Ariel is one of those content now Finance industry just absolutely cannot deal with not safeer work it's
processor problem so everybody's saying like oh all the off girls on on are are destroying twitch no like it's not a problem it's not it's not an issue um that's totally fine the content that is on Twitch even the most like racy
content that's on Twitch for only fans girls is well within Advertiser like like dude if I go on YouTube right now and I go to like here okay like there's a lot more crazy on YouTube that I can't even show you on Twitch all right try
youtubing naked yoga for example but I'll just do bikini trons there is a ton I'll just do bikini trons there is a ton of [ __ ] on this website that is as crazy or crazier than twitch and it has in like
this bikini Tryon has 3.6 million views the video is educational by the way and and no meant is way is meant to be sexual anyway um this is fine like the perspective we're totally cool with this kind of [ __ ] but so so like everybody
that's like oh like blah like only fans is destroying twitch like that's not what's really destroying twitch is Extreme controversial stuff because you cut audiences in half with that and so if you cut an audience in half that
means as a brand I'm very sad interestingly it's kind of like the same and that's what I wrote in my thingy does only fans get Bank problems extensively only fans actually almost went safe for work because they were so
only fans made that announcement where they're like hey guys we're going to take a step back from this por stuff and we're going to actually become a safer safeer website the reason they Fu did that was cuz they're so scared of the
banks that's why that happened because what what what ends up yeah like two or three years ago yeah because what ends up happening is like um your transaction if you have like um if you have a transaction fee where it's like you know
you know I might have like one to 3% transaction fees but on pornography is so much higher and the charge backs are so much more significant and there's literally paying like 5 to 8% per transaction so the way to understand
that is that if somebody gives you $10 $100 in a normal transaction like doing anything in the financial economy you're taking like $1 to $3 of that $10 of that $100 but in not safe for work content you're taking five to eight of those
dollars so it's like way higher and that's there's a lot of reasons for that that just pornography transactions are like really dangerous because like it's like oh like this was actually a 25-year-old that had his mom's credit
card and decided to you know give an only fans girl like $4,000 and then they more liability in dealing with this number and there there's a good reason why this number is um so High um and there there's a reason why Banks try to
avoid this kind of not safe for work content uh so yeah like suffice to say the adult industry is great like the adult industry is like totally fine relationship with it I I have a I have two clients right now that are adult
oriented and they do great like we do influencer marketing for them we have um we have a lot of like fans girls we have some fin Dom girls we have some crazyit we sponsor on YouTube and Instagram and and and and Tik Tok is great totally
fine obviously my other sponsors like my health brand that I have that's doing um I'm probably not going to put an only fans girl on that but maybe I might you know um just kind of depends on on their um their personal volatility towards
those types of advertising assets anyway twitch has a problem where they are allowing some of this extreme content and not others uh but if you allow any and not others uh but if you allow any of it really doesn't matter what um you
are going to run into this advertising problem so the short of it is that this I said I was going to do which is like it it kind of addresses the problem oh hey well since this is not like categorized but the people that are
still like sending clips into to advertisers from extreme content streams and saying hey your toothpaste ad is showing next to this particular clip of extreme content that will continue to happen and so this is a very lazy way of
couple big streamers that like came to me or came at me I guess I should say takes things like this with like content classification labels and such and were happen like I I'd get I'd bet you like
like bro I don't bet people I'm not a gambler like if I get money I'm going to use it to build my business there's you know how many huge streamers have a twitch most of them are public about it too it's like literally giving money to
like these broadcasters to just gam to piss away on slots or whatever and then the fom people come on do you think YouTube isn't making discoverability for the same issue twitch does with that crazy [ __ ] being said no it's not that
it's more just like um YouTube is just carouses right now their team is more interested on in producing um results in those fields and and and they don't have a lot of um production overhead to like
right now where where you're where you're seeing live be featured as a discoverability tool is in the vertical feed right now so do you know why twitch never built out their ad delivery System earlier on because they're lazy bro
to get rid of and that it's a major loss leader for them to get people younger people sub to Prime does that sound right no that is not right I I don't business understand the term lost leader they think it has something to do with
would probably make sense to anybody that's even not in business right you you are losing money in business it's not good okay losing money is
not good okay losing money is bad I get sad when I lose money I don't like loss lead leaders right now I could go through a whole explanation uh in terms of like corporate stuff as to why loss leaders are not good uh but to the
second part of that younger people sub to Prime so twitch tried that there were many initiatives from like 2017 to like 2022 is so there was stuff
2017 to like 2022 is so there was stuff like twitch music twitch Sports twitch student which I was a part of Etc and the goal was all to convert young people to Twitch Prime uh the idea was like so for example with like twitch student you
would uh have people go into schools you'd give talks You' do Esports stuff just trying to get people to be excited about twitch and then the idea was that about twitch and then the idea was that um twitch Prime which is a part of the
um twitch Prime which is a part of the larger Amazon package of Amazon Prime would get young people to subscribe up but they have since run the data on that for the past like I don't know how many years and unequivocally determined that
don't convert people up through twitch Prime and the reason is because younger demographics just use their parents account uh have less disposable income account uh have less disposable income the price of Amazon Prime is increasing
but the weight of younger people isn't so more of younger people isn't so more inflation more CP higher CPI uh equals less spending and also just some practical stuff which is just like the I
guess like like culturally like twitch audience is different from Amazon audience and like what there is crossover in in buying because everybody that watch Twitch on like a regular basis and like the 18 to 25y Old crowd
going to be spending compulsively on Amazon and so Amazon realized that there was way better verticals so for example the uh chat you guys want to know what the uh chat you guys want to know what the highest converting product on Amazon
is uh type any guesses I'll see if anybody gets it right what is the um what is the product that makes Amazon the most money it is not AWS good guess the most money it is not AWS good guess though movies audible
Prime beauty products books good guesses nobody's got it yet the number one highest converting product is groceries if you spend even $1 on groceries on
Amazon AKA you make your first order the average return over a year from that $111,000 and 993 the average return basically saying
to buying groceries on Amazon they buy all their groceries on Amazon and this by far beats any kind of upward conversion funnel that Amazon has so suffice to say that there are now lots of reasons why Amazon is not really
get people because there are so many other advertising verticals where you company did that during Co and that was honestly great yeah this is wild because there yep you would not think it and I
would not know this if I wasn't told this by an EVP at Amazon who who who do you think twitch Prime has left before it's removed uh I don't know I'd don't listen to to streamers and entertainers about like how business
works I understand why they think that I understand why they think that Amazon uh the twitch Prime is a potential convert funnel for Amazon Prime but that has been tested tried and true for the past like four or five years and it is
unequal the data is unequivocal that that is that is not upcon converting about from my perspective we were literally running ads with twitch with convert up to Amazon Prime so I literally have personal hard data on
unequivalent this is not true if I were to guess I would say that twitch Prime is probably gone in a year or less but every time I guess something and I tell making a prediction from like an informed data perspective everyone's
like oh Devon got that one wrong you know so I'm not making like a a super Prime would push people to Prime but it didn't work right yes I mean that's the idea of any kind of package right so like the problem is like twitch Prime is
costing Amazon it's at least 20 million a month by some estimates it's like north of 50 so I'm like I'm shocked that it's already it hasn't already been huge amount of money people think that twitch is such a big deal and they don't
this to them that like if you were to go ask Andy jasse about twitch right now like hey man like what do you think about twitch he probably wouldn't have a take now the CEO of entertainment might know a little bit more but even he knows
this as like a kind of small line item and it's so funny like these streamers like twitch that as if like the whole conversation is about them it's one of the big streamers they think that everything is about them and nobody
trillion dollar company so this is like not even a line item of a line item somewhere on a balance sheet and probably the reason why it exists still and been like oh that's losing this money we should just cut that and the
day that happens which could be tomorrow or could be in 5 years they'll just cut the profits aren't as High they'll just audit all of these Services literally they'll be like oh well that was one of the ones that's like burning a lot of
data driven company so they'll just be like hey like give me the white paper on again there's four years of data showing that it doesn't and then that'll be that it's actually like really simple is Twitch still involved in AWS IVs no that
product is completely spun out you can go see it over here so IVs is actually not even in the same category as twitch anymore twitch is under Prime video and literally under the Prime video and entertainment category here so the CEO
that runs uh with an Amazon that runs twitch and the VP and an executive that oversees twitch technically um that oversees uh Dan Clancy and that vp's concern is Prime Video in a completely different department is AWS uh twitch
used to be under AWS while it was integrating its uh video service and Jesse I don't know who the current CEO of AWS is after he moved up to CEO so under AWS it was actually quite important but now you can just use it um
as a portion of AWS and so twitch isn't even even part of AWS anymore which is considered to be not generally considered it is a more important part some of the recent bad press and politics go higher than twitch or is it
contained to Twitch only um Clancy is aware of it and the VP Who currently know if it goes further than that I I sincerely doubt it I doubt that any other like I think that's I think it's probably like an L6 L7 issue um and
beyond that probably nobody knows what do you say about the people who tell you for years genuinely curious my predictions are in line with most experts in their respective Fields experts get it right about 70% of the
time that's pretty much where I'm at every single thing I've said that was manifested pretty much on the exact same time frame I've said it I don't have a industry you're always going to have like detractors and haters that say like
arguments I've never said twitch is ever going to shut down like literally point me to a single video where I said twitch is going to shut down haven't said that uh still not saying that right I there have been times where I've been worried
unless I say like if something doesn't happen um but that's just an overs simplication of my arguments and my content by simpletons that I don't care
to engage with I'm not threatened by people that are not experts in the field uh I saw lwig say it so I thought was some truth to it lwig is an Entertainer lwig is not an authority on these subjects lwig should not be listened to
stuff Amazon can burn money so they don't need to sell it a lot to Silk and Valley based on their perceived worth yeah maybe yeah there are there are plenty of major content creators that will come after me because I am talking
about their income streams and that's not good they want to keep making money like I said like my the the current meta that I'm in right now is that most
content creators um just shouldn't be in the business of like talking about meta and Industry issues being a business owner doesn't make you an expert lwig is a business owner lwig is a equity holder
in businesses that are run by people other than him Nick Allen is The Mastermind behind offbrand not lwig Nick Allen is a legit CEO he comes in here and talks a lot about stuff if you listen if you want to listen to Somebody
listen to Nick he is the absolute real Authority probably like my level or this kind of stuff if he says I'm wrong then I'll listen I'm so over like sparring with like people that aren't in authority on things like I'm not going
to like people like destiny that like take on the debates and stuff like that I'm like over it I don't if a person is not an expert on something I don't care going to engage with them they're not in the business everybody has a hot take
practitioner or [ __ ] off really like that's that's where I'm at right now like i' I've spent millions of dollars of advertising I have two companies behind me that i' I've literally built from the ground up Brick by Brick that
somebody else run it for me I ran it right like I'm I'm done with it they can it just brings more attention to my content and people will know it's legit because I'm data driven so that just gets more people to watch my videos it's
gets more people to watch my videos it's great