How YouTube monetising Shorts affects the short-video space

Short-video consumption has taken the world by storm. So, while TikTok is at the top, at least outside India, more players are focusing on short-form content, including Instagram. YouTube introduced Shorts in 2020 and currently has over 1.5 billion signed-in users per month and over 30 billion daily views.

YouTube also recently came up with the ‘Shorts Fund’ that lets creators earn extra money. The platform has said that Shorts has received exponential growth.

Philipp Schindler, Senior Vice-President and Chief Business Officer at Alphabet (Google’s parent company), had said that consumers are increasingly consuming short-form videos and they are seeing this across multiple platforms, including YouTube.

“We’re continuing to see good user engagement on YouTube. Early results in Shorts’ monetisation are also encouraging, and we’re excited about the opportunities here,” Schindler said during the course of a call with analysts. 

What exactly is the Shorts Fund? 

The YouTube Shorts Fund is a $100 million fund to reward creators for their dedication to making creative, original content. Unlike the traditional advertising-based monetising opportunities seen on long YouTube videos, the Fund lets creators claim a bonus based on the channel’s performance in the Shorts segment in the previous month.

“A channel’s Shorts will count toward their monthly performance each month viewers watch them, not just the month they were uploaded,” says YouTube. 

“The level of performance needed to qualify for a bonus payment may change from month to month based on various factors, including the location of your viewers and the overall growth of Shorts,” it added. 

YouTube further states that qualifying channels can get between $100–$10,000 each month. Bonuses are adjusted based on the location of a creator’s audience. 

How does this affect the short-video space? 

According to experts, monetising Shorts is empowering creators, and it is a strategic response to Instagram Reels.

Arun Prabhudesai

Arun Prabhudesai, Founder, Armoks Media, said, “With the rise in the short format content with an average of 30 billion daily views, it was imminent that Google would announce a monetisation model for YT shorts. This will not only encourage creators to continue creating short-form content but also gives them the financial liberty to improve quality and sustain in the market. We at Shorts break (a content platform) individually garner close to 2 billion monthly average views which made it an integral platform for brands, monetisation will only take this journey a notch higher.”

Sagar Pushp

Sagar Pushp, CEO and CoFounder, ClanConnect, stated that more and more people want to consume snackable content. He said even brands have realised that short videos have much better engagement rates. 

He further said that with this the overall number of creators on YouTube will also increase.

“A few years ago, Instagram was all about IGTV but now everything is on Reels as brands see a much higher engagement rate. This is the same route Shorts will follow because a lot of branded content will be there on it. The more monetisation avenues the better it is for the creator because you see not every creator could master long-form content and similarly not every creator can master short-form content. This allows a larger category to come onto the platform and create original content,” Pushp said. 

Vivek Kumar Anand

According to Vivek Kumar Anand, Director- Business and Innovation, DViO Digital, the move also ensures that original content is present on Shorts. Asked about how the move is affecting the creator’s earnings, he said, “I am not sure if creators will look at Shorts monetisation as the most important vertical of their earning.”

“Evey platform including Meta and YouTube is struggling to get the same content creators on their platforms to create original content,” he added.