Update: YouTube will give content creators 55 percent of revenues generated from subscription back to content creators. Terms of service for YouTube Partners will be updated in June. 

In a letter to content creators, YouTube revealed that it will soon be offering an ad-free subscription to its site.

The paid offering will be a monthly fee — much the way Netflix prices its subscription plans. The fee will be shared with content creators, allowing them to diversify revenues.

YouTube

The updated terms of service for YouTube program partners included how much content creators stand to gain from the new subscription:

“YouTube will pay you 55% of the total net revenues recognized by YouTube from subscription fees that are attributable to the monthly views or watchtime of your Content as a percentage of the monthly views or watchtime of all or a subset of participating content in the relevant subscription offering (as determined by YouTube). If your Content is included in and viewed by a user in multiple subscription offerings, YouTube will pay you based on the subscription offering with the highest amount of net revenues recognized by YouTube, as calculated by YouTube.”

These terms are set to go into effect by June 15th, according to TechCrunch, however there is still no official date for when YouTube will roll-out its paid service.

Google and YouTube’s paid offering comes as HBO and other channels previously restricted to cable television are making digital plays. But the field of digital video streaming is already booming with video-streaming services from Netflix, Amazon, and Hulu, and there are more to come. Earlier this year Overstock.com said it too would be making a bid for digital video.

There are also social media platforms like Vine, Snapchat, Facebook, and Twitter; even newer entrants like Meerkat and Periscope stand to take a bite out of YouTube’s viewership.

Needless to say, the building competition has not gone unnoticed.

But through a paid subscription option, YouTube will not only have an opportunity to lessen its reliance on ad dollars, it will also have a new way to lure in hot talent.

Via: Bloomberg