The algorithm has nothing to do with the largest unsolved mystery in a short-form video. The truth is that you can’t get wealthy on TikTok since even the most popular producers only receive a small fraction of their cash from the app.
Over the imitative short-form video feeds that rival social media giants like Instagram Reels and Snapchat Spotlight have launched in recent years, TikTok continues to hold a significant lead. However, The New York Times is reporting that YouTube Shorts is getting ready to introduce an ad revenue-sharing arrangement that may revolutionize short-form video and give TikTok a run for its money.
Possibly the first website that allowed creators to support themselves by publishing valuable material online was YouTube. Three years after its launch, YouTube launched its Partner Program in 2007, giving creators a 55% share of the money made from the ads that appear before or during their videos.
However, TikTok rewards its artists through its $200 million Creator Fund, which was launched in the summer of 2020. At the time, TikTok stated that it intended to double that pool globally and increase it to $1 billion in the United States over the following three years.
That might seem like a lot of money, but over the previous three years, YouTube has paid artists more than $30 billion in ad income.
It’s more difficult to decide how to appropriately divide ad money on an algorithmically generated feed of short videos, which is one major reason why TikTok and other short-form video apps haven’t introduced a comparable revenue-sharing scheme yet. Who would receive the income split if you placed advertising between two videos? You can’t put an ad in the middle of a video – try viewing a 30-second film with an 8-second ad in the centre. the artist whose video came first or second in the sequence? Or, since their work inspired you to keep scrolling, wouldn’t a creative whose video you had previously seen in the feed also deserve a cut?
This summer, Jim Louderback, the former CEO of VidCon, told that the industry would find out how to monetize this content. “We’re still in such early days on how we commercialize this stuff, but I am an optimist, and I think that the industry will figure it out,” he said. They will have to do so because, in the absence of it, creators will follow the money.
However, it appears that YouTube has discovered it. At its Made on YouTube event on Tuesday, the firm is apparently planning to reveal an advertising income-sharing arrangement akin to the Partner Program. If the allegations are accurate, makers of YouTube Shorts would receive 45% of advertising income, a larger share than they already receive for YouTube videos but a vast improvement over the pitiful Creator Fund payment. Like Louderback mentioned, creators will pursue profitability.