Bulletins

There's a 'giant hole' in TikTok’s creator economy, Hank Green said

The longtime vlogger said as TikTok gets bigger, paid creators will start to see less money.

TikTok app on a phone

The creator said there’s a flaw in the way people make money on TikTok.

Photo: Andrew Harrer/Bloomberg via Getty Images

Hank Green doesn’t think creators on TikTok are getting paid well enough, and he doesn’t think the majority of the people on TikTok even realize it, the vlogger explained in a YouTube video on Thursday.


“Along with the many innovations of TikTok, there have been some creator monetization innovations that I think are really worrying and bad for creators,” he said in the video. “It’s a bit of a giant hole in the creator economy.”

Green has a huge presence on the video-sharing platform: He’s racked up over 6 million followers and has been making TikToks since 2019. He’s been creating videos for far longer than that; in 2007, Green and his brother started a video blog, and he’s branched out to several platforms like YouTube since then.

The creator said there’s a flaw in the way people make money on TikTok: As the platform continues to grow, creators will start to make less money. That’s because creators who get enough views to be paid make money through TikTok’s Creator Fund, which is a set amount of money the platform reserves each year, is static, whereas TikTok is growing. As TikTok gets bigger and the pool of money for the fund stays the same, those who can get paid won’t make as much. “When TikTok becomes more successful, TikTokers become less successful … What?” Green pointed out.

He said he experienced this issue himself. At one point, he was making 5 cents per 1,000 views on TikTok. Now, he said he makes about 2.5 cents per 1,000 views on the platform.

The platform has grown the amount allocated for its Creator Fund over the past few years. In 2020, TikTok set aside $200 million for the fund, and the platform had planned for it to grow to $1 billion in the U.S. over the following three years. At the same time, the number of users exploded from 700 million in 2020 to 1 billion monthly active users last year.

A TikTok spokesperson said the Creator Fund is one of many ways creators can make money off the platform; users can connect with brands through the Creator Marketplace, give tips and more "We continue to listen to and seek feedback from our creator community and evolve our features to improve the experience for those in the program," the spokesperson told Protocol.

But Green argued that creators will always make less than, say, YouTube, because they’re paid from a static pool of cash instead of the platform’s revenue. On YouTube, creators take about half of the money from an ad posted to their video, and YouTube takes the other half. TikTok doesn’t pay creators from ads, which Green said could be because ads are posted as individual, separate clips rather than a leading segment at the beginning of a creator’s video.

Green asked his 6 million followers how many ads they see per TikTok on average, and found that most people were getting one ad per 10 or so TikToks. He said the platform could take the money made from those ads and give paid creators some of the cut, similar to the partnership YouTube has with its creators.

“Every creator who thinks to themselves, ‘Wow, $1,000 a month, that’s $12,000 a year,'” he said. “That person could be a full-time creator. They could be thinking about expanding, about hiring, about creating a business in their community for their audience. This is the economic engine that drove YouTube forward, and TikTok is just letting it leak out of the tub, into their bottom line.”

Green said creators need to work together and speak out about the issue. He said competing platforms for creators, like YouTube Shorts and Instagram Reels, could prompt some action from TikTok, adding that he currently makes more from Instagram Reels than he does on TikTok even though he gets more views on TikTok.

“So what are we going to do? I don’t know,” he said. “That depends on what the three populations here do: the creators, the audience and the platform. If I learned anything from 15 years, doing this, when those three groups get aligned, really amazing things happen. So I want those three groups to be aligned.”

This story was updated with a comment from TikTok.

Latest Bulletins

Last year saw a notable jump in ransomware attacks that included exfiltration of data as a component, highlighting an ongoing shift in the way the attacks are monetized, according to Verizon's major annual breach report.

Keep Reading Show less

Snap is the latest tech giant to join The Great Hunkering Down. Like other social media companies that flourished during lockdown, the company is struggling to meet earnings estimates and will slow hiring.

Keep Reading Show less

Spotify stopped hosting political ads on its services in early 2020, citing a lack of “robustness” in its systems, ahead of what turned out to be the ugliest U.S. election in recent history.

Two years later, as the midterm primaries get going, the company is courting political advertisers once again, according to a company presentation and marketing email viewed by Protocol.

Keep Reading Show less

Quality assurance testers at Call of Duty studio Raven Software have voted overwhelmingly to form a union with the Communications Workers of America, marking a historic labor victory for the video game industry. The vote, with the Milwaukee office of the National Labor Relations Board, was 19-3.

Keep Reading Show less

Federal labor prosecutors in California plan to file a complaint against Activision Blizzard for illegally threatening workers if the company doesn't agree to a settlement, according to National Labor Relations Board spokesperson Kayla Blado.

Keep Reading Show less

Swedish "buy now, pay later" company Klarna is laying off 10% of its workforce, CEO Sebastian Siemiatkowski told staff via a pre-recorded video call Monday. Interest in pay-later products has sagged somewhat as consumers have felt more financially strapped and advocates in the U.S. began investigating the deferred payment plans last year. Klarna has reportedly been looking for more funding, potentially at a lower valuation.

Keep Reading Show less

The New York State Common Retirement Fund, one of the nation’s largest pension funds, announced that it will vote to remove all of Twitter’s directors at this week’s annual shareholder meeting. The vote against the directors is unlikely to result in change, but it shows mounting institutional pressure for Twitter to resist Elon Musk’s vision for relaxed content moderation policies.

Keep Reading Show less

Apple is looking to boost global production outside of China as the country’s "zero-COVID" strategy cripples production facilities, the Wall Street Journal reported.

The strict lockdown, which has been described by the WHO as "not sustainable," has shut down large cities, including Shanghai, as the highly infectious omicron variant spreads.

Keep Reading Show less

As the Supreme Court weighs whether to block Texas' social media "censorship" law, a court of appeals has decided to uphold the injunction on a similar Florida law, finding that social media companies "are 'private actors' whose rights the First Amendment protects."

Keep Reading Show less

GameStop is all about Web3: The company announced on Monday that it will launch a digital wallet for crypto and NFTs.

The GameStop wallet can be used across apps without users needing to leave their browsers, the company said in a statement. The self-custodial Ethereum wallet gives users access to the keys to their digital assets rather than trusting them with a third party, and is available for download as an extension on Google Chrome's web store as well as on web browser Brave. The wallet will also be available as an iPhone app down the line, according to the GameStop wallet website. The wallet uses Loopring for transactions, a Layer 2 solution that's meant to lower transaction fees.

Keep Reading Show less

D.C. Attorney General Karl Racine is suing Mark Zuckerberg, alleging the Meta CEO was responsible for decisions that opened the door for the Cambridge Analytica scandal.

Keep Reading Show less

The U.K.'s Information Commissioner’s Office, the country's privacy watchdog, has ordered facial recognition company Clearview AI to delete all data belonging to the country's residents.

Keep Reading Show less

Meta will finally give researchers access to targeting data for political ads — information that academics have been clamoring for and using legally risky workarounds to collect on their own for years.

Keep Reading Show less

Coinbase just celebrated its 10th birthday. And the crypto powerhouse marked the milestone on a defiant note, with a snarky TV ad clapping back at crypto bashers.

Keep Reading Show less

Google is allowing some Android apps to use their own payment systems after getting into battles with both Match Group and Epic Games' Bandcamp, but the move might be temporary. The company is facing legal action for requiring apps in the Google Play Store to use its billing, and the interim solution Google came up with is to let those apps use their own payments — with a catch.

Keep Reading Show less

Larry Ellison was among the participants on a call in November 2020, during which top Trump allies discussed ways to contest the election results, according to The Washington Post. It's unclear what role Ellison played on the call, but The Post found evidence of Ellison's apparent involvement in court records and confirmed with one of the call's other participants.

Keep Reading Show less

Microsoft Bing has exported Chinese censorship abroad, according to a new report by The University of Toronto's Citizen Lab.

Bing searches for national figures, leaders within the Chinese Communist Party, dissidents and topics that Beijing considers politically sensitive did not appear in auto-suggest in North America, according to the report. Among the search terms that didn't generate autocomplete suggestions were searches for President Xi Jinping, the late human rights activist Liu Xiaobo and searches related to the Tiananmen Square massacre.

Keep Reading Show less

Google had its "best year yet" for hiring Black and Latinx employees in the U.S. as well as women globally, according to its 2022 Diversity Annual Report. The hiring rate increased for Black, Latinx, Native American and female employees, although these identities are still very underrepresented compared to white and male employees.

Keep Reading Show less

Tech companies are figuring out how to handle the upcoming historic Supreme Court decision that could overturn abortion rights. In the case of Meta, that includes telling employees to not talk about it at work. Meta VP of HR Janelle Gale told workers during an all-hands on Thursday not to talk about abortion on Workplace, the company's internal messaging platform.

Keep Reading Show less

As many tech companies face a slump and crypto looks set for a deep freeze, Coinbase is facing reality and hitting the brakes on spending. The company is halting some business projects, freezing hiring for two weeks and cutting its spending on Amazon Web Services, the Information reported Thursday.

Keep Reading Show less

AWS reached a private settlement with a female employee who accused now-former executive Joshua Burgin of discrimination and harrasement, Protocol has learned.

Keep Reading Show less

The Federal Trade Commission on Thursday unanimously reminded providers of education technology to follow federal limits on the collection and use of kids' data in an attempt to ensure that common practices in the data economy don't become the norm in schools.

Keep Reading Show less

The apocalypse is coming, at least according to one of the world's biggest startup accelerators.

Y Combinator sent an email to portfolio founders this week, obtained by TechCrunch, advising the startups to "plan for the worst" as the market turbulence has prompted many companies to initiate layoffs, cost-cutting measures and hiring slowdowns.

Keep Reading Show less

Apple just hit an important milestone in developing its mixed-reality headset as rivals like Meta are making strides in developing similar devices. Executives showed off an AR/VR device to Apple's board last week, according to Bloomberg, a sign that the product is really happening and it's inching closer to a public launch.

Keep Reading Show less

The SEC is pushing back on Ripple’s bid for access to emails and other documents that the crypto giant believes could bolster its case against the regulator.

The SEC, which sued Ripple in 2020 for failing to register $1.4 billion worth of XRP as securities, has refused to release emails related to a 2018 speech by former director William Hinman in which he argued the ether cryptocurrency was not a security. The speech sparked a rally in ether’s price and was interpreted as an endorsement of the industry’s view that cryptocurrencies are not securities.

Keep Reading Show less
Bulletins