Views of YouTube Shorts videos hit 30 billion per day in the first quarter of 2022, which is up four times from Q1 2021.
In addition, YouTube confirms it’s now testing ads in Shorts, which will finally allow creators to monetize short-form videos.
This is revealed in parent company Alphabet’s quarterly earnings call for Q1 2022.
The decision to put ads in Shorts isn’t motivated by the 4x increase in views. Rather, it’s prompted by YouTube missing its revenue target.
To be sure, YouTube earned plenty of revenue last quarter and even surpassed the amount earned in Q1 2021.
Since YouTube didn’t hit its target, earning $6.87 billion vs $7.51 billion, the company has to make up for it to appease shareholders.
Ads in Shorts is YouTube’s answer to taking revenue growth to new heights. In turn, creator earnings may hit new highs as well.
Here are the highlights regarding YouTube Shorts from Alphabet’s Q1 2022 earnings call.
YouTube Confirms Ads Are Coming To Shorts
Ruth Porat, CFO of Alphabet and Google, confirms the testing of ads in YouTube Shorts:
“We are experiencing a slight headwind to revenue growth as Shorts viewership grows as a percentage of total YouTube time. We are testing monetization on shorts, and early advertiser feedback and results are encouraging.”
Ads in Shorts would give creators in the YouTube Partner Program the ability to earn more revenue on the platform.
Currently, the only way to make money by creating Shorts is through YouTube’s Shorts Fund. The Shorts fund allocates $100 million to paying creators for content that goes viral.
All creators, even if they’re not in the YouTube Partner Program, can get paid from the Shorts Fund.
In fact, 40% of creators who received a payout from the Shorts Fund in 2021 weren’t in the YouTube Partner Program.
Whether the Shorts Fund will remain in place once ads are rolled out more widely is unknown at this time.
Earnings Potential – YouTube Shorts Vs. TikTok
Ads could significantly increase the value proposition of YouTube Shorts for creators.
Excluding sponsorships and merchandise sales, there are limited options on the web when it comes to making money with short-form video.
Like YouTube, TikTok has a fund from which it pays creators for popular content.
TikTok is less transparent about how much it pays out, though creators report feeling dissatisfied with the revenue split.
Here’s a tweet from @SuperSaf, who has 400,000 followers on TikTok, sharing his feelings about revenue sharing:
This is how much I've made from the TikTok Creator Fund since April 2021 with over 25 million views in that time
— Safwan AhmedMia (@SuperSaf) January 21, 2022
He references a video from YouTuber Hank Green, which is something of a video essay breaking down how TikTok pays creators.
Green makes a case that YouTube is better at paying creators for content, suggesting TikTok’s creator fund isn’t the best way to pay people for their work.
It will be interesting to see if any popular TikTokers make their way to YouTube once ads in Shorts roll out to everyone.
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