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Choke Point Capitalism: How Amazon's Published Rates Affect Twitch
Twitch has two sets of costs: fixed costs for software development and bandwidth costs. Initially, Amazon attracted creators to Twitch by offering them a generous 70% revenue split, while others received a 50% split. However, as Twitch became the leader in its sector and creators became dependent on the platform, Amazon reduced the split for the 70%ers to 50%. The justification for this reduction was the high published rates of Amazon Web Services, which Twitch pays for hosting its platform. However, it is unlikely that Twitch is paying the published rates, as big companies rarely do. The consolidation of Twitch within Amazon allows for the suppression of creator wages, as Twitch becomes the only option for reaching a large audience. This demonstrates the self-serving nature of choke point capitalism, benefitting shareholders but not creators.
