As TikTok eats the world, YouTube makes a bid for creators’ hearts — and wallets

Collected in the company historic Spruce Goose hangar On Tuesday morning, a host of YouTube executives laid out a roadmap for the platform’s evolving relationship with video creators and the music industry, announcing new monetization tools and industry partnerships in the cavernous events space where Howard Hughes once built a giant wooden airplane.

But while tech executives seemed eager to outline their plans for the future of the creator economythey’ve been far more reluctant to acknowledge the aggressively scaling industry upstart that’s taken a massive bite out of the online video ecosystem in recent years: TikTok.

In fact, the Google subsidiary’s “Made on YouTube” press event lasted about an hour before anyone explicitly quoted TikTok — and even then, it was a viewer who called the elephant first during a question-and-answer period in the room.

TikTok, owned by Chinese tech company ByteDance, is largely responsible for popularizing the short-form video format that YouTube, among other imitators, is now aping with its microvideo shorts platform. And while Shorts has become a serious TikTok competitor – YouTube recently claimed 1.5 billion monthly viewers, around the level where TikTok is expected – the medium is still largely synonymous with its pioneer.

“We’ve always worked in a fairly competitive market,” he said Tara Walpert Levy, YouTube’s Vice President for Americas and Global Content, in response to a journalist’s question about the ongoing expansion of TikTok in the United States, including Los Angeles. “Our approach has always been…that we want to be the home for creators.”

It was a point that management kept coming back to. YouTube CEO Susan Wojcicki said in a video that the company was “doubling down on performance [its] Commitment to Empowering Creators.” Chief Product Officer Neal Mohan later described YouTubers as the “heart” of YouTube.

The day’s big announcements seemed poised to refine that creator-centric approach – and as YouTube scales back its ambitions for scripted content, a renewed emphasis on user-generated video fits with the company’s broader direction.

A change coming soon will allow shorts creators to hit 10 million views within 90 days apply for membership in the YouTube Partner Program, a revenue-sharing model the company launched in 2007 to allow YouTubers a share of profits from ads served for their content. (Short filmmakers used to be paid out of a $100 million fund based on their engagement metrics, not ad revenue.)

The shorts revenue share “marks the first time that true short-form video revenue share is offered at scale on any platform,” Mohan said, adding that revenue from ads running between shorts is pooled and donated to shorts creators disbursed are also used to cover music licensing costs.

Short film makers will keep 45% of the money, Mohan said. For long-form videos, this truncation has historically been 55%; YouTube executives partially attributed the smaller cut for shorts to efforts to keep the program sustainable.

Another change adds a new layer to the affiliate program, allowing creators with smaller fan bases to continue making money from their fans through features like membership programs.

As the creators’ economy continues to grow and digital artists demand better and fairer ways to get paid, YouTube’s announcements suggest the company believes short filmmakers will play a significant role in the company’s future — and they might also be discouraged from TikTok is a business imperative.

It’s a move that benefits from the goodwill YouTube already has with some YouTubers. In January, a video posting him by longtime vlogger Hank Green went viral compared favorably YouTube’s revenue sharing model to TikTok’s Creator Fund, a static pool of money that the company divides among top creators.

TikTok’s approach is “a huge hole in the creators’ economy,” Green said at the time, because with a fixed amount of money up for grabs, payouts per person go down as the number of eligible creators increases. (Tick Tock subsequently announced its own revenue sharing system, TikTok Pulse, which was more in line with the YouTube model.)

At Tuesday’s event, the company also announced new infrastructure to help long-form video creators incorporate licensed music into their content — with singer-songwriter Jason Derulo on deck to explain how closer collaboration between artists and creators will work benefit both.

“The biggest problem [with tapping into social media fan bases] have always been the rights,” said Derulo, who wore a red jacket covered in Marvel movie-themed patches. “And from an artist’s point of view: I want my music to be heard. I want my music to be on your side.”

In the past, YouTubers have had to forego advertising revenue when incorporating licensed music into their videos, said Amjad Hanif, YouTube’s vice president of product management and creator products. But through the company’s new platform, Creator Music, creators will soon be able to browse songs and then either license them directly or enter into a revenue sharing agreement with the original musicians, Hanif said.

According to Derulo, this is a step that indicates how the entertainment industry as a whole is evolving in the age of internet-created celebrities.

“Growing up, a lot of people had Britney Spears or NSYNC on their wall,” the singer said. “But now… they might have a Bryce Hall or a Jake Paul.

“The modern rock star,” Derulo continued, “has changed.”

https://www.latimes.com/entertainment-arts/business/story/2022-09-21/as-tiktok-eats-the-world-youtube-makes-a-bid-for-creators-hearts-and-wallets As TikTok eats the world, YouTube makes a bid for creators’ hearts — and wallets

Sarah Ridley

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