YouTube and TikTok Are Amping Up the Creator Monetization Arms Race

YouTube and TikTok are going head-to-head on new ways to pay their content creators.

YouTube Shorts will now incorporate an expanded array of ads on its short-form video feed, Business Insider reported Tuesday, which could potentially lead to Shorts creators receiving a cut of ad revenues. Meanwhile, TechCrunch reported yesterday that TikTok is beta-testing LIVE Subscription, a new model which allows fans to directly compensate creators.

YouTube Shorts, which previously showed limited ads from select advertisers, will now expand to ads purchased through YouTube’s main video platform. While creators won’t immediately benefit from the change, YouTube plans on analyzing the Shorts ads’ performance to determine how it will pay creators, BI reported.

Currently, YouTube Shorts’ $100 million creator fund only pays out top performers and is set to end later this year. While creators on YouTube’s main platform receive a 55% cut of ad revenues, BI reported that Shorts creators have thus far found monetization difficult.

"The Shorts Creator fund isn't anywhere near large enough to incentivize larger creators to stick around or generate unique content for the platform,” Shorts creator Nicholas Crown told the publication. “Without ad rev sharing, creators generating millions of impressions on Shorts often make pennies from the occasional pre-roll ad that runs through AdSense on a Short.”

TikTok’s LIVE Subscriptions, on the other hand, will give creators on the video-sharing platform a chance to earn direct payments from fans, while giving paying subscribers access to exclusive chats, emotes and badges. The feature will launch with select creators on Thursday, TechCrunch reported; while pricing has not yet been announced, LIVE’s is believed to be “comparable” to livestreaming platform Twitch’s $4.99 monthly subscriptions. Instagram is currently testing a similar creator subscription model.

With TikTok and YouTube stars gaining popularity, both companies are seeking to offer new monetization models that would keep those creators on their platform. Social media influencers, for their part, have looked to spread their content across multiple platforms—as evidenced by Snap poaching TikTok stars for its own original content. In turn, both Culver City-based TikTok (which is owned by Chinese tech firm ByteDance) and Santa Monica-based Snap have introduced new ad revenue initiatives for creators this year.