Islamabad: Popular Chinese short-videos-sharing platform TikTok and American online video sharing company YouTube have entered a new competition.
TikTok has already announced that it will start sharing advertisement revenue with creators who produce the top 4% of best-performing videos.
While that is an extremely high bar to hit, those creators now have an opportunity to make substantial revenue from their content. TikTok wants to attract those billions of advertising dollars dedicated to online campaigns.
TikTok already has a Creator Fund in place, but the payout is restricted to US $ 200 million per year. While that works out to approximately $ US 550, 000 available per day, every creator in the fund has to share any funds granted with the rest of the creators eligible for a payout.
Now the YouTube unveiled a new way for creators to make money on short-form videos, as it faces intensifying competition from TikTok.
The Google-owned streaming service has announced that it would introduce advertising on its video feature Shorts and give video creators 45% of the revenue. That compares with its standard distribution of 55% for videos outside of Shorts and TikTok’s US $1 billion fund for paying creators.
The internet’s dominant video site has struggled to compete with TikTok, the app that got its start hosting lip-sync and dance videos and has subsequently burgeoned to 1 billion monthly users.
YouTube responded in late 2020 with Shorts, minute-long videos that attract more than 1.5 billion monthly viewers.
In April, YouTube created a US $100 million fund to entice creators to make bite-sized videos in its bid to hang onto talent. The new revenue-sharing plan is meant to be a bigger and more sustainable lure than the fund and 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 US $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 advertisement 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.