YouTube’s Shorts Are Killing Its Core Business

Date: September 04, 2023

YouTube, the video content giant, has witnessed a sharp Year-On-Year downfall in long-form video content since it introduced shorts to compete with TikTok and Instagram.

In its quest to trump competition, YouTube recently introduced a new video format called Shorts.  It involved 30 to 60-second-long videos in a vertical design, similar to TikTok’s base UX and Instagram’s Reels. But now, an internal staff member has revealed that it is instead facing a backlash in revenues due to the growing popularity of the Shorts.

YouTube has always been a leader in long-form content, with one of the world's biggest and most diverse libraries. However, the leader is losing its Year-on-Year revenues from long videos as creators switch to shorts as their primary format. The company logged more than 2 billion logged-in users, which is a relatively much bigger number than garnered by TikTok or Instagram. But its growing popularity among the YouTube Shorts audience cannibalizes its core business format, one of its biggest USPs.

What’s Happening To YouTube?

Google reported that in the second quarter of 2023, YouTube brought in $7.67 Billion in advertising revenue. This is 4 percent higher than the previous year’s clockings. However, when revenue from Shorts was compared with the revenue from long-form videos, they underperformed. 

Long-Form Vs Short-Form

The content trend is dropping in long-form video formats as content creators are getting better deals and more profits for creating Shorts. The relative effort and expense of creating Shorts is lower too. And, in terms of originality of content, Shorts don’t actually need that much of it.

The core business and one of the top USPs of YouTube is long-form. We can see content from 10-15 minute vlogs to hours-long documentaries on YouTube. The purpose of Shorts was to complement these original content forms either as trailers or content attractors. But now there is not much difference left between the Shorts and other social media platforms. YouTube recently introduced monetization in Shorts that grew its popularity even further. The steep decline in long videos is now becoming an unavoidable evil for YouTube’s team as they have already grown manifold in gaining an audience. It has to further support the Shorts community to keep the revenue growing, while strategizing how to retain long-form content attraction from a global audience.