Senior employees express concerns that focusing on shorts could potentially harm YouTube’s primary business

Senior employees express concerns that focusing on shorts could potentially harm YouTube's primary business

Concerns have been voiced about how YouTube’s response to TikTok, called Shorts, is diverting audiences away from the platform’s lengthier video content.

Shorts, which was launched in 2021 and has garnered over 2 billion users, has reportedly siphoned viewers away from YouTube’s traditional long-form videos, as per sources familiar with the statistics.

Recent strategic discussions at YouTube have revolved around the possibility that extended videos, which generate more revenue for the company, are dwindling in popularity as a format. This shift is attributed to the growing popularity of short-form videos driven by mobile phone usage and the rapid ascent of TikTok, particularly among younger demographics.

In October of the previous year, YouTube reported its first-ever quarterly drop in advertising revenue since it began disclosing its performance separately in 2020. Subsequent quarters also witnessed further declines in comparison to the same periods in the preceding year.

Nevertheless, in July, YouTube announced a 4.4 percent increase in ad sales to $7.7 billion for the second quarter, constituting approximately 13 percent of Google’s ad revenue.

Despite this recent improvement, internal data at YouTube has raised concerns among staff, indicating that content creators are producing fewer long-form videos due to reduced consumer demand and a preference for short-form content favored by brands for product placement.

In one meeting, a senior staff member drew a parallel between the decline in long video viewership on YouTube and the decreasing interest in reading books, as both activities demand more time and focus.

YouTube has stated that Shorts is “designed to complement, not compete with, all the other formats creators use” on the platform, such as audio and livestreams. The company emphasized that this approach creates “a virtuous cycle that drives new viewers to different formats.”

Established social media companies like YouTube and Meta, which owns Instagram, introduced their short-form offerings in 2021 to counter the threat from TikTok. According to Joseph Teasdale, head of tech at Enders Analysis, YouTube is aggressively promoting Shorts to its vast user base, even if it comes at the expense of ad revenue, as a defensive strategy.

Longer videos offer more opportunities for advertising and tend to have higher click-through rates on ads leading to e-commerce sites, according to individuals familiar with YouTube’s business.

To attract new creators, YouTube has implemented payment mechanisms that are more lucrative than TikTok’s and has introduced editing tools within the platform.

The video division has also partnered with Google DeepMind, its parent company’s AI branch, to develop artificial intelligence solutions that bring cost savings and performance enhancements to the platform, such as faster video compression before users can upload videos.

However, less than 10 percent of creators utilize YouTube’s in-app editing tools for Shorts, as reported by one individual with knowledge of the figures. Additionally, the platform downgrades videos that feature TikTok branding.

Many influencers and content creators find it easier to maintain engaging, relatable content for shorter durations, often lasting just a minute, as opposed to the energy required for longer, 30-minute videos.

YouTube operates on a revenue-sharing model with creators, offering 45 percent for Shorts and 55 percent for long-form content. However, for many creators, the bulk of their income comes from brand deals for product endorsements in their videos.