YouTube is kicking off its new revenue sharing model for YouTube Shorts next month – a key step in the platform’s short-form video ambitions. This week, it released guidelines explaining how exactly Shorts creators can monetize their content.
Each month, YouTube will collect Shorts ad revenue and then disperse it to creators, as well as the platform’s music partners if the videos contain licensed music. If a creator uploads a Short with no music, all of the revenue associated with its views will go into the Creator Pool – the overall revenue amount allocated to creators.
If the Short does have music, YouTube will split the revenue between the Creator Pool and music partners, depending on how many tracks are used. For instance, a Short with one track will have half of its associated revenue go towards music licensing costs, with the remaining half allocated to the Creator Pool.
Each Shorts creator will then be allocated a revenue share based on how many times their video was viewed in their respective country. As YouTube previously announced, Shorts creators retain 45% of monthly ad revenue, regardless of whether their videos use licensed music or not.
YouTube also pointed out which Shorts won’t be eligible for monetization. Those include videos containing unedited clips from movies or TV shows, reuploaded content from YouTube or another platform, views that come from automated click or scroll bots and Shorts that don’t comply with YouTube’s advertiser-friendly content guidelines.
YouTube elaborated on how revenue sharing works by offering a hypothetical example. Say a country has 100 million Shorts views and 20% of those Shorts use a single music track. Out of $100,000 total ad revenue, YouTube allocates $90,000 to creators and $10,000 to cover music licensing costs.
If a creator’s Short is viewed 1 million times, they are allocated 1% of the Creator Pool, or $900. The creator will earn 45% of that amount, which would be $405, YouTube explained.
But before creators can begin making money off shorts, they will need to accept the base terms of YouTube’s Partner Program (YPP) as well as the Shorts Monetization Module. All creators in the program – even if they’re not Shorts creators – need to agree to the base terms by July 10, 2023.
YouTube first unveiled its updated YPP last fall, making it easier for short form content creators to monetize their content. Shorts creators with at least 1,000 subscribers and 10 million Shorts views in the last 90 days are eligible to apply.
The new Shorts revenue sharing model replaces YouTube’s $100 million Shorts Fund, a fixed funding model established back in 2021. Parent company Google has expressed optimism in Shorts monetization, despite YouTube’s ad revenue decline in Q3 2022.
“It’s still early but we’re encouraged by the progress we’ve made this year in Shorts monetization and support for sustaining the creator ecosystem,” Google CBO Philipp Schindler said on the company’s Q3 earnings call.
While short form videos are typically associated with mobile devices, YouTube in November announced Shorts are now available to watch on smart TVs, streaming devices and gaming consoles. Shorts competitor TikTok made a similar move last summer, integrating its software onto Vizio TV sets.
YouTube Shorts boasts 1.5 billion monthly signed-in users as of June 2022.