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YouTube Is About to Change Drastically

Google Inc.'s YouTube logo is displayed behind the reception desk at the company's YouTube Space studio in Tokyo, on March 30, 2013.
Kiyoshi Ota—Bloomberg/Getty Images

YouTube is introducing a new way for its legion of video creators to make money on the site. The Google division announced Thursday at Vidcon that it is launching a crowdfunding system called Fan Funding that will allow viewers to donate as much as $500 to video creators. The feature, which will function more like a tip jar than the highly coordinated campaigns on sites like Kickstarter, is being tested among a select number of channels in the United States, Mexico, Japan and Australia. Creators can apply to have their channels added to the trial.

Internet users have shown a huge appetite for funding video projects in recent years. On Kickstarter, Film and Video is the second most-funded category on the site, with people pledging $224 million to such projects over the years. Patreon, a newer startup that was launched by a YouTube creator seeking more revenue, has generated $2 million for creators since it launched early in 2013. By adding a donation model of its own, YouTube may be able to keep its stars more tightly bound to its own ecosystem, rather than seeing them venture off to other sites. But YouTube says its own donation system is meant to be additive, not a direct competitor to these other sites. “Fan funding is an addition to goal-based fundraising like Kickstarter, as well as subscription-based fundraising like Patreon, and we hope creators continue to use all these tools to reach their greatest levels of success,” YouTube spokesman Matt McLernon said in an email.

YouTube will take a 5% commission on all donations, plus a flat fee of $0.21 to cover costs, McLernon said. Kickstarter and Patreon also charge a 5% commission, while crowdfunding site Indiegogo’s fees range from 4% to 9%. In addition to the donation system, YouTube announced several other new features, such as support of video shot at 60 frames per second and a new weekly radio show on Sirius XM starring YouTube star Jenna Marbles.

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