YouTube put a challenge to TikTok to offer 45% of ad sales to Shorts creators

As TikTok's market share grows, YouTube introduced a new mechanism for producers to monetize short-form videos (YouTube-Shorts).  The streaming service, which is owned by Google, revealed on Tuesday that it would start running ads on its video feature Shorts and give video producers 45% of the proceeds.  This contrasts with TikTok's $1 billion fund for paying producers and its usual payout of 55% for videos other than   Shorts.

Ahsan Qadir, a former accountant who now runs the YouTube channel Gorgeous-Info, praised YouTube for allowing revenue-sharing for Shorts.  Other platforms, he noted, "are concentrated on giving people their 15 seconds of fame, which is fantastic.

 "YouTube, though, is employing a different strategy.

They assist creators in producing content in many media."

The most popular video platform on the internet has had difficulty competing with TikTok, an app that began by offering dance and lip-sync videos before ballooning to 1 billion monthly users.

In response, YouTube released Shorts in late 2020, minute-long videos that get more than 1.5 billion monthly users.

In an effort to retain talent, YouTube established a $100 million fund in April to encourage creators to produce short videos. The New York Times broke the news of the new revenue-sharing plan, which is intended to be a greater and more enduring enticement than the fund and something TikTok hasn't yet been able to match.

Vice President Tara Walpert Levy explained that YouTube is distributing a reduced percentage of sales to Shorts artists in order to balance off the huge investment it made in creating the product.

In the first half of this year, Google made $14.2 billion from YouTube ad sales, an increase of 9% from the corresponding time in 2021.

However, since the data's disclosure started three years ago, the most recent quarterly ad sales showed the slowest growth.

Financial analysts have stated that TikTok is a factor in addition to global economic considerations.