The problem is people hate paying for what was once free. YT will lose a lot of potential future creators if now they have to pay to sign up.At this point, nobody knows anything for certain, as things are changing on a daily basis. But this much I do know, YT will find a way to make money off of kids' content, so what is happening now, is not the way it will always be.
Let's face it, kid's are the overwhelming majority of traffic on YT. YT knew this and targeted them and this is why we are here today. If YT was a road system, kid's channels were the Interstate Highway of YT and the Ads were Billboards on those Highways. YT has effectively shut down their Interstate Highways with all the things they have done to kids channels in the last week. This means that YT is losing millions a day in ad revenue because nobody is driving down those interstate highways seeing those billboard ads. Does this make sense being put in this form?
Okay, YT is not going to let this go on for long. It takes time to adapt to such a huge change and programing takes a lot of work. But I am telling you that YT has a vested interest to figure how how to get their kid's channels interstate highways and billboards back up and running. Now, just because they can't place Targeted ads on kid's content, does not mean they cannot place any ads at all. YT can still place Contextual ads. YT had no reason to negotiate for Contextual ads before this because the money for Targeted ads was so much better, but now they those are no longer an option, YT will renegotiate ad contracts for the kid's ad space.
So I believe that the Ad revenue will come back for Kids channels eventually. A lot of what YT is doing right now, as far as the features they are turning off, is simply them trying to make it look like they are very proactive in stopping targeted ads to children, because they are under the microscope of the FTC. These features will come back.
I think that they are going about it the wrong way and they are working way harder than they need to. All YT needs to do to solve this whole problem is to move all kid's content off of YT main and onto YT Kids and renegotiate the ad space for Contextual Ads or make it a subscription-based platform. Boom problem solved.