YouTube will reward Shorts creators 45% of ad sales in response to TikTok’s growing competition
The streaming service, which is owned by Google, revealed on Tuesday that it would start running ads on its video feature Shorts and give video producers 45% of the money.
The Google-owned streaming service announced Tuesday that it would introduce advertising on its video feature Shorts and give video creators 45% of the revenue. That compares with its standard distribution of 55% for videos outside of Shorts and TikTok’s $1 billion fund for paying creators.
Hairstylist-turned-YouTube-creator Kris Collins, who goes by Kallmekris, lauded YouTube for offering revenue-sharing for Shorts.
“Other platforms are focused on getting people their 15 seconds of fame, which is great,” she said. “But YouTube is taking a different approach. They’re helping creators make stuff in multiple formats.”
The internet’s dominant video site has struggled to compete with TikTok, the app that got its start hosting lip-sync and dance videos and has subsequently burgeoned to 1 billion monthly users.
In response, YouTube released Shorts in late 2020, minute-long videos that get more than 1.5 billion monthly users.
In an effort to retain talent, YouTube established a $100 million fund in April to encourage creators to produce short videos. The New York Times broke the news of the new revenue-sharing plan, which is intended to be a greater and more enduring enticement than the fund and something TikTok hasn’t yet been able to match.
According to Vice President Tara Walpert Levy, YouTube is distributing a smaller percentage of profits to Shorts creators in order to balance out the large investment it made in creating the service.
In the first half of this year, Google made $14.2 billion from YouTube ad sales, an increase of 9% from the corresponding time in 2021.
However, since the data’s disclosure started three years ago, the most recent quarterly ad sales showed the slowest growth. Financial analysts have stated that TikTok is a factor in addition to global economic considerations.