The US video platform will now give creators 45% of ad revenue on its short-form video feature known as Shorts. That comes on top of the existing 55% of ad revenue it offers creators of long-form videos.
TikTok has surpassed YouTube for time spent on the app by younger generations around the world, and is especially popular in the United States and the United Kingdom.
Young eyeballs rested on the app for 91 minutes a day in 2021 – well above YouTube’s 56 minutes, according to research by Qustodio.
The Chinese video platoform started out with a 15-second video limit but that has now expanded to 3 minutes, eating into YouTube’s market. It currently offers $1 billion in funds to pay to video creators.
YouTube responded in late 2020 with Shorts, minute-long videos that attract more than 1.5 billion monthly viewers, biting back at TikTok.
Hairstylist-turned-YouTube-creator Kris Collins, who goes by the pseudonym 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.”
In April, YouTube created a $100 million fund to entice creators to make bite-sized videos in its bid to hang onto talent.
The new revenue-sharing plan, first reported by the New York Times, is meant to be a bigger and more sustainable lure than the fund and is something TikTok has yet to match.
YouTube is sharing a smaller proportion of sales with Shorts creators to offset its significant investment in developing the feature, vice-president Tara Walpert Levy said.
Google generated $14.2 billion in YouTube ad sales during the first half of this year, up 9% from the same period in 2021.
But the most recent quarterly ad sales reflected the slowest growth since disclosure of that data began three years ago. Though global economic factors are at play, financial analysts have said TikTok also is a factor.
- Reuters, with additional editing from Alfie Habershon