By Jack Nicas 

YouTube canceled its top star's show on Tuesday over his anti-Semitic jokes, complicating its efforts to court television advertisers while also retaining its edgy video stars.

YouTube, a unit of Alphabet Inc.'s Google, distanced itself from its most popular creator -- 27-year-old Felix Kjellberg, who goes by PewDiePie -- after The Wall Street Journal reported he made anti-Semitic jokes or showed Nazi imagery in nine videos since August. Walt Disney Co., which helped run Mr. Kjellberg's business, severed ties after the revelations.

YouTube canceled the second season of Mr. Kjellberg's show, "Scare PewDiePie," which anchored YouTube's $10-a-month subscription service. The company also pulled his YouTube channel from its Google Preferred program that lets advertisers buy space before "some of the most engaging and brand safe" videos on YouTube. The PewDiePie channel has amassed 53 million subscribers, nearly double the next most popular YouTube channel.

However, Mr. Kjellberg can still maintain a significant presence on YouTube. He will be able to post videos to his channel and ads can appear before his videos, generating income for him through shared advertising revenue with YouTube. Most ads on the site are placed through automated auctions that match ads with the demographic of viewers marketers choose. In Mr. Kjellberg's case, his viewers are mostly male teenagers. Companies can blacklist his channel.

One advertiser who worked with Mr. Kjellberg has already distanced itself. The YouTube star in December posted a paid promotion for Nissan Motor Co.'s Micra compact car. "We strongly condemn this highly offensive content and will not work with him again," a Nissan spokeswoman said in an email Tuesday. She said that Nissan had paid him for the creation of the one ad spot but had no ongoing relationship.

YouTube has positioned itself as advertisers' preferred alternative to television by cultivating its video creators, or so-called influencers, who draw teenage audiences. But the sheer variety and unpredictability of much of YouTube's content still makes advertisers wary of shifting more of their spending away from proven TV commercials.

"YouTube and even Disney have some blame in this situation," said Adam Kleinberg, head of San Francisco ad agency Traction Corp. "YouTube is marketing their influencer network as a safe place for brands to interact...and [PewDiePie] is their biggest property."

He said beyond the anti-Semitic content, PewDiePie has for years posted profane and sexual videos. Mr. Kleinberg said his firm has spent several million dollars on YouTube ads over the past year and would likely blacklist PewDiePie's channel on all future campaigns. By pulling the ads that run before videos, thereby depriving creators of shared revenue, or by removing the videos outright, YouTube risks angering its influencers.

"Influencers are saying YouTube is too strict, and advertisers say it isn't strict enough," said Jesse Leimgruber, chief executive of NeoReach, which helps companies advertise on social media influencers' content.

YouTube's crackdown on PewDiePie "is definitely going to have a ripple effect in the influencer community," he said.

Like other social media firms, YouTube is caught between satisfying its users and its advertisers. Companies such as YouTube, Facebook Inc. and Twitter Inc. sell advertising on user-generated content, over which they have little control, sometimes ensnaring them in controversies. Facebook has battled false-news sites, while Twitter is grappling with online bullying.

YouTube moved tentatively on Mr. Kjellberg's videos before Tuesday. It deleted ads within days of the posting of one of the most controversial videos, in which two men held a sign for 23 seconds that read, "Death to all Jews."

But the company left ads running before the other eight videos played until after the Journal reported on them, when the online-video platform determined they had violated its "advertiser-friendly content guidelines."

YouTube said it left the videos on its site because it determined they don't violate a separate set of rules, their community guidelines, which have a higher bar for removal. Those rules ban content that "promotes or condones violence against individuals or groups based on race or ethnic origin [or] religion." But in reviewing videos, the company says it also considers the intent of the creator, and content intended to be provocative or satirical may remain online.

Mr. Kjellberg's account pulled three of the nine videos in question after the Journal contacted Disney on Friday, and then reinstated one on Tuesday.

In a video responding to media criticism of the "Death to all Jews" sign, he said it was a joke and that he wasn't an anti-Semite. Mr. Kjellberg wrote in a Tumblr post Sunday that he doesn't support "any kind of hateful attitudes" and understands "these jokes were ultimately offensive." Mr. Kjellberg didn't responded to direct requests for comment on the videos.

On Tuesday, Mr. Kjellberg was silent on the controversy surrounding him, only making one public post: a YouTube video titled "Valentine's Special!" in which he and his girlfriend play a videogame as penis-shaped characters that fight each other.

Write to Jack Nicas at jack.nicas@wsj.com

 

(END) Dow Jones Newswires

February 14, 2017 19:31 ET (00:31 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
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