How YouTube monetisation of Shorts will work

YouTube will from next year open up monetisation for Shorts, its 60-second answer to TikTok and Instagram Reels. But unlike ad revenue on its longer videos, YouTube is taking a slightly different approach to how it will monetise Shorts.

Till now, YouTube has limited its YouTube Partner Program (YPP) to those creators who posted long-form videos. These were the only creators who could monetise their content. But starting in 2023, it will offer monetisation to those who are primarily posting Shorts as well, though not all Shorts creators will automatically earn revenue.

The announcement comes as social media companies from Meta’s Instagram to TikTok continue to chase short video creators, who are driving most of the engagement on these platforms. According to YouTube, each month, Shorts is seeing 30 billion views with 1.5 billion logged-in users viewing these videos.

“To get into YPP you need to have 1000 subscribers and 4000 long-form watch hours. Now, you can get in through your Shorts content with 10 million views in the last three months and 1k subscribers,” Thomas Kim, Director of Product Management, Creator Monetisation at YouTube explained.

The advertisements themselves will run between the Shorts, given it is mostly an endless scroll of content. In contrast, a typical long-form YouTube video has ads appear in the beginning, middle or end and these ads are allocated to each particular video, thus allowing the creator to make money from them. With Shorts, the ads will not be allocated to one particular video.

“We’re going to take the revenue from all those ads, and add it all together. A part of that will go to pay music licensing costs. And the other part goes into a creator pool to pay out the creators, distributed equally across the creator views. So you’re paid up based on your share of total views. Creators retain 45% of that total pooled revenue,” Amy Singer, Director, Global Partnership Enablement added.

YouTube stressed that this 45 per cent remains irrespective of whether a creator chooses to include music in their video or not. This percentage is less than what YouTube offers for longer videos where the creators get 55 per cent of ad revenue. YouTube will look at the total pooled ad revenue on a monthly basis, country by country and distribute it based on the views.

According to Singer, there are several reasons the company came at the 45 per cent share for Shorts. “There’s a sustained investment that will be required here. One area is music. The second is constant investment in the product tools, the creator tools, and the product experience. Finally, we have millions of new creators coming onto the platform with their content and we need to support them,” Singer explained.

YouTube also revealed it could lower the bar or minimum threshold to get into YPP, though the details have not been worked out yet. This could take place sometime next year, and if it does, it would mean that creators could start making some money on the platform sooner– especially those creating short-form videos.

It also plans to extend its Super Thanks feature to Shorts by 2023. In this, the creator’s audience can tip them as well and in a way fund the content. But for Super Thanks, 70 per cent of the revenue share on Shorts will go to the creator when this does roll out eventually.

And while monetisation of Shorts was long expected, getting views on Shorts is easier said than done given the increasing competition in the space.

When asked how exactly a Short video gets recommended, Kevin Ferguson, Director of Operations and Partnerships at YouTube Shorts, explained that the algorithm is still a work in process. “We are continuously learning and getting better at distributing the right content to the right user based on interest. It’s less up to the creator than it is up to our systems to ensure that content gets to the right place,” he pointed out.

Creators also get access to analytics tools in the creator studio on YouTube, which gives them an indication of what users are searching for on the platform. But in the end, it is the algorithm which will recommend the content.

And what about the issue of originality on short platforms? One problem is that many of the creators are just copy-pasting content from other platforms to all of their channels on other platforms. YouTube, however, doesn’t see this as a problem, just yet.

“We are never gonna say to creators, just post on YouTube. I think it’s good for them that they can express themselves across different platforms. They are repurposing content very often across these platforms. Again, it’s up to us to make a compelling product with amazing creative tools. I hope we have way more original content on the platform over time,” Ferguson said.

(The author is in Los Angeles on the invite of YouTube India)

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