In Nigeria’s fast-growing digital ecosystem, Multi-Channel Networks (MCNs) play a crucial role in connecting content creators with wider audiences while enabling monetization on platforms such as YouTube. For businesses seeking to harness digital content for marketing or revenue purposes, a clear understanding of MCN agreements is essential. This newsletter highlights key factors companies should consider when exploring partnerships with MCNs in Nigeria.
Understanding Multi-Channel Network Agreements
MCNs are organizations that affiliate with multiple channels such as YouTube, social media platforms, etc., offering services such as audience development, content programming, creator collaborations, digital rights management, monetization, and sales. They act as intermediaries between content creators and platforms, facilitating growth and revenue opportunities.
On the other hand, Multi-Channel Network Agreements are contractual arrangements between content creators and MCNs, entities that manage and support creators on platforms like YouTube. These networks provide a suite of services, including audience development, digital rights management, monetization strategies, and brand partnerships, in exchange for a portion of the revenue generated by the creator’s content. For companies, MCN agreements represent an opportunity to collaborate with influencers and creators to amplify their brand reach and engage targeted audiences. However, these agreements can be complex, often encompassing critical aspects such as revenue-sharing models, intellectual property rights, content ownership, and performance obligations. Understanding the specific terms and implications of an MCN agreement is essential for businesses to ensure alignment with their strategic goals while mitigating potential risks, such as content disputes or unclear profit-sharing terms.
Key Considerations in Multi-Channel Network Agreements
- Revenue Sharing Models: MCNs typically operate on revenue-sharing models, where earnings from advertising, sponsorships, and other monetization avenues are split between the network and the content creator. Companies should scrutinize these models to ensure transparency and fairness. It is essential to understand the percentage splits, payment schedules, and any deductions that may apply.
- Intellectual Property Rights: Clarifying ownership of content produced under the MCN partnership is vital. Companies must ensure that agreements specify who holds the rights to the content and any associated intellectual property. This clarity prevents future disputes and ensures that both parties understand their rights and obligations.[i]
- Content Control and Brand Representation: Maintaining brand integrity is paramount. Companies should ensure that MCNs adhere to brand guidelines and that there are mechanisms in place to review and approve content before publication. This control helps in maintaining the desired brand image and messaging.
- Performance Metrics and Accountability: Establishing clear Key Performance Indicators (KPIs) and prohibited activities is essential to measure the success of the partnership. Agreements should outline expectations regarding audience growth, engagement metrics, and content quality. Regular reporting and review processes should be established to monitor performance.
- Legal Compliance: Ensuring compliance with advertising laws, consumer protection standards, and privacy regulations is crucial. Companies should verify that MCNs have robust compliance frameworks to mitigate legal risks. This includes adherence to the Nigerian Copyright Act 2022 and other relevant legislation.
Risks and Challenges
As a Multi-Channel Network, engaging with companies and content creators carries its own set of risks. These include potential conflicts over revenue-sharing arrangements, disputes regarding content ownership, and reputational risks if associated companies or creators fail to meet expected standards or engage in controversial actions. To mitigate these challenges, an MCN must establish robust operational and governance frameworks, ensuring transparency in financial reporting and contractual agreements. Clear, well-drafted contracts should outline revenue distribution, intellectual property rights, and performance expectations to prevent disputes. Additionally, conducting due diligence on prospective companies and creators and implementing strict compliance measures can safeguard the MCN’s reputation and foster long-term, mutually beneficial partnerships.
Best Practices for Negotiating MCN Agreements
- Protect Intellectual Property and Revenue Streams: Clearly define ownership rights over content and establish favorable revenue-sharing terms. Ensure contracts protect the MCN’s long-term monetization interests, with detailed payment structures and mechanisms to resolve disputes.
- Ensure Legal and Market Compliance: Customize agreements to comply with Nigerian laws such as the Copyright Act and NDPR. Include provisions for content alignment with local cultural norms and implement robust data privacy measures to maintain compliance and trust.
- Establish Partner Accountability and Exit Strategies: Set measurable performance metrics for partners and include termination clauses that allow the MCN to disengage from underperforming or harmful partnerships, while safeguarding assets and reputation.
Conclusion
Multi-Channel Network agreements offer significant opportunities for companies to expand their digital presence and engage with new audiences. However, careful consideration of the factors outlined above is essential to ensure successful and legally sound partnerships. By approaching MCN agreements with due diligence and strategic planning, companies can effectively leverage these collaborations to achieve their business goals.
References
- Google Support. (n.d.). Multi-Channel Network (MCN) overview for YouTube Creators. Retrieved from https://support.google.com/youtube/answer/2737059?hl=en
- Kunkle Trademark and Legal. (n.d.). Multi-Channel Network Contracts. Retrieved from https://kunklelaw.com/lp/multi-channel-network-contracts/
- Vondran Legal. (n.d.). YouTube Lawyer for MCN Contract Review. Retrieved from https://www.vondranlegal.com/lawyer-to-review-mcn-channel-network-contracts-for-youtube-channel
- Typito Blog. (2017). Network Partnership Document: Working with an MCN – Part II. Retrieved from https://typito.com/blog/working-with-mcn-part-2/
- Videomaker. (2017). Should I Join a YouTube Multi Channel Network? Pros & Cons. Retrieved from https://www.videomaker.com/article/c05/18678-should-i-join-a-youtube-multi-channel-network-pros-cons/
- American Bar Association. (2017). The Law of YouTubers: The Next Generation of Creators and the Legal Issues They Face. Retrieved from https://www.americanbar.org/groups/intellectual_property_law/publications/landslide/2016-17/may-june/law-youtubers-next-generation-creators-legal-issues-they-face/
- Law.asia. (2023). Why MCN agencies lose influencer contract. Retrieved from https://law.asia/mcn-agencies-lose-influencer-contract/
[i] MVNO Agreements: Key Legal Considerations For Sustainable Partnerships. – Privacy Protection – Privacy – Nigeria
