Twitch has long charged $4.99 for a tier one sub, and roughly translated that price into other currencies. It's meant that for years, other countries have either paid significantly more for a month's subscription, or the price has been abnormally high compared to the local cost of living. Twitch is finally addressing the pricing disparity, and is introducing local subscription costs to try and level things out.
Mexico and Turkey are the first to receive pricing more reflective of the local cost of living. A tier one sub will cost 48 pesos (around $2.42) and 9.90 Turkish lira (around $1.19). Most countries in Asia, Latin America, the Middle East, Africa, and Europe will migrate to local pricing sometime later this year. Twitch has provided a full list of the countries due to receive new pricing. It says the "vast majority of countries outside of the US" will see lowered prices.
Twitch says the reason behind local subscription pricing is a huge discrepancy between active US subscribers and those from elsewhere in the world, with the translated $4.99 price making it "difficult for many viewers" to dump money into subscriptions. "This isn't just anecdotal; it's reflected clearly in the numbers," Twitch wrote in a blog describing the changes. "The percentage of active users in Europe or Asia who support creators with a subscription is roughly 50% lower relative to North America. In Latin America, it's nearly 80% lower."
We’re rolling out one of the biggest changes in Twitch history, which will help creators build larger, more global communities: Local Subs Pricing. The price of a sub in most countries will be lowered, starting with Mexico and Turkey. Learn more: https://t.co/LzKQxynb5B pic.twitter.com/zNBeRC4WyOMay 17, 2021
While this is good news for the standard viewer, Twitch has predicted the potential pushback from creators who may see their revenue tank during the changes. "Twitch will cover 100% of baseline channel and Prime sub revenue (if needed) for three calendar months, including the month of the price change. After that, we will slowly decrease incentive payments by 25% every three months over the following nine months, totalling a 12-month period of providing revenue adjustment incentives."
Essentially, Twitch is calculating each creator's average monthly earnings. If revenue falls lower than that during these changes, Twitch will cover the entire loss for the first three months before lowering payments throughout the year.
It's great to see Twitch finally offering local pricing, but it's taken an awful long time to do so. Local pricing is something that Steam has been offering for years—take a glance at the SteamDB page for PUBG and you'll see how costs vary by country. Better late than never though, eh?
Twitch has been making a few changes to its platform recently. A bit of self-inflicted DMCA hell prompted more support for creators to deal with copyright issues. Some rogue code also revealed plans of a future "brand safety score," though there's no public announcement for it yet.