In the face of increasing competition from TikTok, Google-owned YouTube said it will introduce advertising on its Shorts video offering and give video creators 45% of the revenue. They are also launching an option where viewers can tip creators.
Ad revenue from Shorts will be pooled together each month and then divvied amongst creators. After YouTube factors in the cost of music licensing fees, creators will get 45% of the total pool. According to YouTube, the popularity of short-form video has “exploded” with over 30 billion daily views and 1.5B monthly logged-in users.
The YouTube Partner Program (YPP) was first launched in 2007 to allow creators to share in revenue and earn money from their content. According to YouTube, over the past three years alone, they have paid over 2 million creators, artists, and media companies over $50 billion.
“To start rewarding this new creative class, we launched a temporary Shorts Fund,” said Amjad Hanif, Vice President of Creator Products, YouTube in a blog post.
“Now, we’re expanding our unique business model to this new format: revenue sharing is coming to Shorts.”
“We expect the majority of our Shorts Fund recipients to earn more money under this new model, which was built for long-term sustainability. Instead of a fixed fund, we’re doubling down on the revenue-sharing model that has supercharged the creator economy and enabled creators to benefit from the platform’s success,” Hanif added.
Here’s how it’ll work according to YouTube:
- Beginning in early 2023, current and future YPP creators will be eligible for revenue sharing on Shorts.
- In Shorts, ads run between videos in the Shorts Feed. So, every month, revenue from these ads will be added together and used to reward Shorts creators and help cover costs of music licensing.
- From the overall amount allocated to creators, they will keep 45% of the revenue, distributed based on their share of total Shorts views. The revenue share remains the same, no matter if they use music or not.
YouTube additionally announced the introduction of Creator Music, “a new destination in YouTube Studio that gives YouTube creators easy access to an ever-growing catalog of music for use in their long-form videos.”
Creators can now buy music licenses that offer them full monetizing potential and they will keep the same revenue share they’d usually make on videos without any music, said YouTube.
Creator Music is currently in beta in the US and will expand to more countries in 2023, they added.