YouTube is testing ads on its short-form answer to TikTok, Shorts

YouTube is starting to test advertisements on Shorts, a short-form video feature the company introduced in 2020 that’s similar to what TikTok and Instagram offer.

The company is specifically experimenting with app-install ads and other promotions, Google’s chief business officer, Philipp Schindler, told investors on Tuesday.

“We are experiencing a slight headwind to revenue growth as Shorts viewership grows as a percentage of total YouTube time,” Alphabet CFO Ruth Porat said. “We are testing monetization on shorts, and early advertiser feedback and results are encouraging.”

According to Google, YouTube’s Shorts is generating 30 billion daily views, which is four times that of last year’s.

Meanwhile, YouTube’s ad-revenue growth went up, reaching $6.86 billion, its first-quarter earnings report reveals, but that was below analyst expectations. The video-sharing site says it also witnessed a drop in direct response ads, such as app-install campaigns.

The news comes after YouTube introduced a $100 million creator fund for Shorts last year, hoping to lure creators into using its platform.

YouTube announced in August that it would pay creators making popular videos up to $10,000 per month. The company, at the time, considered it an alternate way to ads of paying creators while the company fleshed out a long-term, scalable monetization program for them.

During his February appearance on The Vergecast with Nilay Patel and Catie Keck, YouTube chief product officer Neal Mohan discussed further plans for creators to make money from Shorts. These include adding branded content, making it possible for consumers to shop from a Short, and bringing Super Chat to the service. You can listen to him talk about these plans in more detail on the podcast here.