Meta is pausing its program which rewards creators by paying them for making Reels and meeting certain benchmarks. The program, which began in 2021, incentivized content creators to create more short video content. The shutdown will affect all Reels creators on Facebook and Instagram creators who are US-based — the Instagram program was only available to US-based creators.
Meta’s decision to discontinue the program was first reported by Business Insider, which suggests that platforms are looking to pull back payments from creators based on the popularity of their short videos. According to the report, Meta will honor any bonus commitments for the next 30 days.
Meta told the publication that if Reels enters a new market, it may reintroduce the program in “targeted” ways. This is surprising given that the short video product is already available in over 150 countries.
Previously, creators received substantial bonuses through this program. Several creators received bonuses in excess of $10,000, with some claiming to have received up to $35,000 in a single month. However, these creators needed millions of views on their Reels, and Meta was happy to distribute money to help the format gain popularity.
Given that short video is one of the most popular formats on social media today, Meta is most likely trying to bank ad money. Last year, it expanded its overlay ads experiment to creators in over 50 countries, in addition to displaying in-stream ads. For both of these ad formats, the company splits 55% of the revenue with the creators.
Mark Zuckerberg announced last year that Reels had reached a $1 billion annual revenue rate. However, the company hopes that the format will generate more revenue while it spends money on metaverse efforts.
On the investor call for Meta’s Q4 2022 results, Zuckerberg asserted that Reels is not yet profitable enough.
“The next bottleneck that we are focused on to continue growing Reels is improving monetization efficiency or the revenue that’s generated per minute of Reels watched. Currently, the monetization efficiency of Reels is much less than Feed. So the more that Reels grows, even though it adds engagement to the system overall, it takes some time away from Feed and we actually lose money,” he said.
Because the company is removing bonuses, creators will need incentives to post short videos on Meta’s platforms instead of TikTok or YouTube Shorts. Facebook has promised to provide more monetization tools for creators to earn money on Reels.
“This year, we’re focused on adapting and enhancing these [monetization] tools for short-form video. We’ll continue expanding our ads on Facebook Reels tests to help more creators earn ad revenue for their Reels and grow virtual gifting via Stars on Reels,” Facebook head Tom Alison said in a blog post earlier this week.
However, Meta is not an outlier when it comes to halting creator bonuses for short videos. Instead of splashing the money in creator funds, Snapchat and YouTube Shorts have shifted to ad revenue-sharing models.