YouTube Looks to Beat TikTok by Offering More Chances to Make Money – Business Insider

The dramatic rise of TikTok may have thrown its social-media competitors into a frenzy, but YouTube could come out on top by playing the long game. Emphasis: long game.
Last month, YouTube finally released its plans to drop ads into its TikTok competitor, Shorts. The plan would give creators who are part of YouTube’s Partner Program a 45% cut of ad revenue generated from their short-form videos. YouTube also lowered the bar for some creators to make money off YouTube, with fewer qualifications on subscribers and watch time and a new, lower threshold that the company is set to detail next year.
The announcement kicked off an unofficial war for the monetization of short-form video. So far, short-form videos have proved to help creators build audiences quickly — but money is another story. Numerous TikTok stars with huge followings have said their work on the platform nets them pennies in revenue.
Whether YouTube can significantly change that remains to be seen. It won’t start rolling ads out until next year, but conversations with former YouTube executives and media companies indicated YouTube could come out a winner in the short-form competition — even if it didn’t displace TikTok. More importantly, it could drive the oncoming rush of short-form creators to post long-form videos to rake in even more money. 
Insider spoke with multiple former YouTube executives, creators, and media executives. They spoke anonymously because some were under nondisclosure agreements, and others were not authorized to speak publicly about YouTube.
One advantage YouTube has in the monetization drive is its likelihood to be more capable of selling ads for short form than the competition. It has a far more sophisticated ad-sales business than its rivals, especially TikTok. Last year, YouTube generated $28.8 billion in revenue. The company can sell a new vertical ad format to marketers as a package deal on top of the ads it’s already selling for traditional long-form YouTube.
But the bigger play for YouTube is its ability to draw in more creators. TikTok poses a threat to YouTube because it could cut off its funnel of up-and-coming creators. If YouTube has a successful short-form-video product — and one that makes creators more money — it can keep creators engaged with the platform.
For YouTube, winning would mean becoming a successful No. 2 player in the space. YouTube doesn’t have to become the top short-form-video product, “but they just have to not lose,” one former YouTube executive said.
Recent data from Sensor Tower showed that YouTube had emerged from the growth of TikTok mostly unscathed. In August, people spent an average of 73 minutes a day watching YouTube, the data showed. That trailed TikTok’s 94 minutes. But YouTube was still growing 3% compared with the same month last year — an impressive showing for a much older app than TikTok.
And as more TikTok creators simultaneously post their videos as YouTube Shorts to take advantage of the monetization, YouTube is hoping it will eventually drive them to post full-length YouTube videos (or “longs,” as they are referred to internally at YouTube), a former YouTube executive said. The moneymaking systems through traditional YouTube, though imperfect, are a well-established way for creators to turn audiences into revenue.
“A bunch of creators that tried to start on YouTube but didn’t get anywhere with 3- to 10-minute videos went to TikTok. Now those users may try to start on YouTube. If they keep at it, they become a long-form creator,” this former executive said. 
For media companies creating videos on YouTube, the platform’s recent emphasis on short form has been bumpy. One media executive at a company that runs several top YouTube channels said they felt forced to start creating for Shorts when YouTube’s algorithm began favoring them and that some of their channels had dips in engagement.
They’ve since made up the losses by making more content for Shorts. The media company has an active presence on TikTok as well. But the money, he said, will likely always come from long-form YouTube. And if YouTube is smart, it won’t forget that, he added.
Short-form videos “will never be as lucrative as the long-form stuff,” the executive said, adding: “If that dominates the YouTube landscape, it’ll be a problem for us.”
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