YouTube woos creators away from TikTok with 45% cash incentives for short clips

‘Shorts Monetization Process’ comes into effect today, which will see creators earn up to a 45% share of the revenue from ads viewed between an uncapped shorts video fund.

YouTube has launched a new scheme that will see revenue from ads displayed between Shorts clips shared among eligible creators in the app.

In its blog annoucing the news, YouTube said: “Starting February 1st, 2023, monetizing partners will be able to earn money from ads that are viewed between videos in the Shorts Feed. This new revenue sharing model will replace the YouTube Shorts Fund.”

YouTube first announced the new revenue share program in September last year, and it has the potential to change the way that all platforms monetise short-form video content.

As short clips can’t feature pre- or mid-roll ads like regular video uploads, established, most social apps have reverted to creator funds to maintain a monetisation pathway to encourage creators in their apps, but that’s not a sustainable process.

YouTube’s new payment model will make the cumulative funds from Shorts ads  allocated to a much larger pool, with the video sharing site then splitting 45% of that total amount among Shorts creators, based on respective views.

That means that the payouts will grow as Shorts does, while the funding is not capped, as creator funds are.

Creators will be able to apply for a cut of Shorts ad revenue if they have over 1,000 subscribers, and have seen 10 million Shorts views over the preceding 90 days. 

“Clearest indication yet that YouTube is willing to throw its financial weight behind creators. This will concern other platforms, especially TikTok”

Commenting on the move, Thomas Walters, Europe CEO and co-founder of Billion Dollar Boy, said: “The launch of YouTube’s new revenue sharing model on Shorts content could significantly disrupt the creator economy. It’s already creating a huge buzz in the industry among creators, brands and agencies and we could see other platforms replicating the approach if it’s successful. 

“That’s because the model is not only more sustainable and equitable than existing creator fund models, but also more flexible and offers creators significantly more earning potential. Put simply, the better your content performs, the more you can earn. And if Shorts grows, the amount creators earn grows too.

“It makes sense for YouTube too. By lowering the eligibility threshold for creators to monetise their content and by increasing their earning potential in excess of key competitors, YouTube is incentivising more creators to invest time and resources into the platform - while at the same time diverting them away from rivals. It’s a clear attempt to stake a bigger claim in the creator economy.

“History shows us that ultimately people follow the money, and the new revenue sharing model is the clearest indication yet that YouTube is willing to throw its financial weight behind creators. This will concern other platforms, especially TikTok, whose USP is the short form video format. Despite its continued popularity and growing brand investment, the looming threat of a potential US ban and YouTube’s increasingly competitive creator offering, could curtail TikTok’s rising influence in the creator economy.

“It’ll be interesting to see how both platforms and creators respond to YouTube’s new Partner Program. For now though, we are seeing more and more enquiries about YouTube Shorts as excitement grows about its potential.”