Snap Inc has abolished its publisher licensing fees on Snapchat’s Discover channels. Instead, the company is opting for shared advertising revenues, according to sources close to the matter.
First reported by Digiday, Snapchat plans to no longer pay the upfront licensing fees for publisher content in favour of a 50-50 split on ad revenues.
A spokesperson for Snapchat said the move was part of a commitment “to help our partners build long-term, sustainable business models on Snapchat”.
The social media app last changed its publishing fee model back in September 2016 when it opted for the upfront flat fee. However, this licensing deal may have deterred more publishers than it initially attracted.
Indeed, one of the core issues was that bigger publishers would receive more favourable deals, potentially angering smaller players.
At the same time, Snap’s latest revenue results weren’t much to celebrate, which may have further weakened publisher interest. Ad revenue deals could prove more lucrative in the long run. Thus, a shared ad revenue agreement offers a better incentive for publishers to sign up to.
Snapchat currently has around 90 media partners on Discover. It remains to be seen if this number will increase throughout the year.