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YouTube’s new process for monetizing Shorts, which will see revenue from ads displayed between Shorts clips shared among eligible creators in the app, will come into effect from February 1st, the video platform has confirmed.

As per YouTube:

“Starting February 1st, 2023, monetizing partners will be able to earn money from ads that are viewed between videos in the Shorts Feed. This new revenue sharing model will replace the YouTube Shorts Fund.

YouTube first announced the new revenue share program in September last year, and it has the potential to change the way that all platforms monetize short-form video content.

The challenge with short clips is that you can’t directly monetize them through pre- or mid-roll ads like regular video uploads, which presents a new challenge for effective monetization. In China, the local version of TikTok now generates the majority of its income via in-stream commerce, but with that same process not seeing significant take-up in western markets, alternative monetization pathways need to be established, in order to keep the top creators posting to each app.

Most social apps have reverted to creator funds to maintain a monetization pathway for creators in their apps, but that’s not a sustainable process, while the structure of such systems also sees payments decline as more creators look to draw money from that pool.

With this in mind, YouTube’s payment model could be a more sustainable, and equitable process, with the cumulative funds from Shorts ads being allocated to a much larger pool, and YouTube then splitting 45% of that total amount among Shorts creators, based on respective views.

That means that the payouts will grow as Shorts does, while the funding is not capped, as creator funds are.

Maybe that will work, maybe not – but YouTube has said that it expects the payouts to be greater than creators are currently seeing from the Creator Fund process.

Creators will be able to apply for a cut of Shorts ad revenue if they have over 1,000 subscribers, and have seen 10 million Shorts views over the preceding 90 days. Once you reach those benchmarks, YouTube will enable you to sign up to the program, with the full funding split based on performance.

YouTube will look to refine its process over time, and it’ll be interesting to see how happy creators are, and will be, with this new funding model for Shorts creation.

It could be the way forward – and if YouTube can provide more funding, and a more equitable, transparent process through which short-form creators can get paid, it could be a big tick in its favor, and increase its appeal to top emerging creators, who might then shun TikTok as a result.

And with TikTok also under increasing scrutiny over its links to the CCP, which could still see it banned in the US, this could be another factor that helps YouTube eventually win out in the short-form video stakes.

You can learn more about YouTube’s Shorts ad revenue share program here.