South America Creator Economy Market Analysis

The South America Creator Economy market size was valued at US$ 2.68 Bn in 2023 and is expected to reach US$ 14.67 Bn by 2030, grow at a compound annual growth rate (CAGR) of 27.5% from 2023 to 2030. The creator economy refers to the class of entrepreneurs, content creators, influencers, bloggers, artists and social media personalities who monetize their content online. It is driven by the explosion of social media, allowing individual content creators to build audiences, monetize and have viable careers. Key drivers include the rising internet and smartphone penetration, popularity of social media platforms like YouTube, Instagram and TikTok, and growth of the digital economy in South America.

The South America Creator Economy Market is segmented by content type, revenue model and creator category. By content type, the videos segment accounted for the largest share in 2022. The rapid growth is attributed to the rising popularity of short form videos on platforms like YouTube and TikTok. Videos allow creators to showcase their talent and engage audiences across niches like comedy, music, gaming and more.

South America Creator Economy Market Drivers:

Growing Internet and Smartphone Penetration: The rapid growth in internet and smartphone penetration across South America is a major factor driving the creator economy market. Internet users in South America have grown from 67% in 2015 to over 80% in 2022. This provides easy access to social media and content platforms like YouTube, Instagram, TikTok where creators reach their audiences. High speed 4G/5G networks allow content consumption and creation. From comedy sketches to musical performances, creators are leveraging internet and smartphones to produce engaging content.

Popularity of Social Media and Content Platforms: The rising popularity of social media and content platforms like YouTube, Instagram, TikTok, and Twitch is enabling the growth of creator economy across South America. Younger demographics are spending more time on these platforms viewing content across genres like comedy, music, fashion, gaming and more. For instance, YouTube has over 125 million monthly active users in Brazil. Instagram has over 100 million monthly active users in Brazil. The huge user base and time spent on these platforms allows creators to build loyal follower bases who consume their content.

According to UNESCO, United Nations Educational, Scientific and Cultural Organization data, the percentage of households in countries like Brazil with access to the internet increased from 40% in 2020 to over 70% in 2022.

Desire for Entrepreneurship and Flexible Careers: Many individuals, especially younger demographics are moving away from traditional 9-5 jobs and seeking entrepreneurship opportunities and flexible careers. Creating content full-time allows setting own schedules and pursuing passions without rigid work constraints. Passion economy platforms like Substack, Patreon, OnlyFans are empowering creators to monetize content directly from fans and build their personal brands. All this drives interest in entering the creator economy. Emerging startups are also providing support infrastructure from content creation tools to legal and tax help.

According to a 2022 survey by the Organization for Economic Co-operation and Development (OECD), 62% of South American internet users prefer local creators and content from their own country over international options.

South America Creator Economy Market Opportunities:

Local Language Content and Creators: There is significant potential to expand regional language creator economies catering to Spanish and Portuguese native speakers across South America. While English content is rising, local language creators tailored for these audiences can drive higher engagement. This presents opportunities across user generated content, music, podcasts, comedy and more. Platforms can expand by identifying and supporting local language creators through funding, workshops and relevant monetization models. Startups can also launch services to discover and manage rising local language talent.

According to data from the ITU (International Telecommunication Union), the percentage of individuals using the internet in South America rose from 58% in 2019 to 61% in 2021.

Integration of Emerging Tech like AI, VR and Blockchain: Emerging technologies like artificial intelligence, virtual reality and blockchain hold significant potential to open up new opportunities in the South America creator economy. For instance, AI can power recommendation algorithms to improve creator discoverability and matchmaking with brands for sponsorships. VR can enable more immersive content formats. Blockchain has scope to facilitate creator transactions, verify credentials and enable newer models like NFTs. As these technologies evolve, they can transform workflows and experiences across creator content, audience engagement and monetization.

According to data from the United Nations, in 2022, over 63% of the total population in South America is aged below 30 years as of 2020.

South America Creator Economy Market Restraints:

• Copyright and Licensing Challenges: Copyright infringement and unlicensed use of content is a major problem. Piracy of videos, music and images hampers revenues. Lack of control over content once shared online also causes issues. Complex copyright laws vary across regions creating confusion. Platform policies need to balance protection and openness. Resolving licensing issues between platforms and creators has been difficult. Addressing content protection through technology and updated IP laws will be crucial going forward.
• Counterbalance: Creators should be educated about copyright laws and licensing agreements. This can help them understand their rights and responsibilities, and avoid potential legal issues.
• Taxation Complexities and Uncertainty: The creator economy poses new challenges for taxation frameworks designed historically for traditional businesses. Complexities arise in classifying full-time vs part-time creators, changing remuneration models and issuance of Form 1099s. For creators with global digital presence, questions around nexus and residency create compliance issues. Ambiguity exists in applying direct vs indirect taxes. Policy initiatives are needed to develop progressive tax structures for individuals earning income via online platforms.
• Counterbalance: Creators and businesses can seek the help of tax professionals who are familiar with the specific tax laws and regulations in South America. These professionals can provide advice and guidance on how to comply with these laws and minimize tax liabilities.
• Mental Health Challenges and Toxicity: The pressure to continuously produce content and stay relevant on social media is causing burnout and mental health issues for many creators. Dealing with comments, unhealthy comparisons with peers and toxicity also takes a toll. The always-on pressure is further exacerbated by opaque platform algorithms that can drastically reduce reach and revenue without warning. While awareness around creator well-being is improving, far more action is needed by platforms in terms of monitoring toxic behaviors and support programs.
• Counterbalance: Creators can seek professional mental health support to help manage stress, anxiety, and other mental health issues. This could include therapy, counseling, or support groups.