YouTube will share revenue with short film creators while increasing TikTok

YouTube Chief Product Officer Neil Mohan, left, with YouTube stars Cassey Ho, center, and iJustine, foreground second to right, on the Nasdaq on May 5, 2016.

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As YouTube tries to chase TikTok into the short video market, the Google-owned company says it will start handing a larger slice of ad revenue to popular content creators.

Starting next year, the company will pay a portion of the revenue from the shorts, which are distributed based on the videos that get the most hits, Neil Mohan, YouTube’s chief product officer, said Tuesday at the creator’s annual Made on YouTube event. Views.

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“This is the first time that real revenue sharing of short-term videos has been shown on a large scale,” Mohan said.

It is not yet clear how profitable the opportunity will be for short film creators because YouTube provides limited information about returns. YouTube said that each month it will collect ad revenue from short films. Of this amount, an undisclosed percentage is allocated to creators, and YouTube will pay them 45% of this amount.

Popular content creators have always been able to make money on the main YouTube website by showing ads in their videos and keeping a portion of the revenue. Google launched the YouTube Partner Program (YPP) in 2007 to make this happen.

So far, the only way to make money in shorts has been with a $100 million shorts fund launched last year.

“Starting in early 2023, creators focused on short films can apply to YPP by meeting the limit of 1,000 subscribers and 10 million short views over a 90-day period,” YouTube said in a blog post on Tuesday.

“We started with the Shorts Fund as a first step, but the Creator Funds just can’t keep up with the incredible growth we are seeing in the short video,” Mohan said.

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YouTube is feeling the pressure from TikTok, which has gained market share by providing an outlet for people to create viral short videos with music. In the second quarter, YouTube saw the slowest rate of quarterly revenue expansion since Alphabet began outperforming video unit sales in the fourth quarter of 2019. The company said it was testing monetization models for shorts, and CFO Ruth Porat previously said YouTube was challenging Through changes in consumer behavior that preferred short videos.

In the new revenue-sharing model on short films, creators will get the same amount of money regardless of whether their videos include copyrighted music, which requires YouTube to pay a licensing fee.

“This allows us to remove all the traditional complications associated with licensing music,” Mohan said.

Regular YouTube video creators earn 55% of revenue from ads that run before or during their videos. In short films, ads are not attached to specific videos but work between the video and the short film feeds.

Mohan said Short has 30 billion views per day and 1.5 billion logged-in viewers per month, which is unchanged from the numbers the company shared in April.

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