Snapchat To Stop Sharing Ad Revenue With Its Partners

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Snapchat, the popular image messaging and multimedia mobile app known for its ability to send videos and pictures that will be deleted permanently shortly after viewing, has an ever increasing user base. The social media platform regularly brings new features to its app and one of its most notable features is the Discover section, which was launched in 2015. In this Discover section, media companies may create their own content on a daily basis for users to view. These media companies receive ad revenue that section produces, but that is about to change as Snapchat says it is done sharing with media companies.

Instead of sharing ad revenue generated from the section, Snapchat is planning to pay its Discover section partners a flat license fee up front. This will allow the company to keep the ad money for itself, and will make it very similar to what TV networks do when they purchase programs. Since the inception of the Discover section, Snapchat has allowed publishers to sell ads on top of their own content. The social media platform has also done the same and it has been proposing the new terms over the past few weeks. Once the new terms come in effect, Snapchat will have full control over the ads which are posted in the app.

As for the media companies which create content for the Discover section, their pay will be guaranteed whenever they create custom content for the app. However, the new deal will limit the money publishers can earn from their content. It also seems that Snapchat is wanting to extend its new terms beyond its Discover section as it has already told media companies that it wants them to create a "Snapchat Show", and wants to use the license model instead of revenue share for the upcoming show as well. While this move by Snapchat has been well received by some of its content creators, others aren't so pleased with it, as they don't want to create content without having any control over the way it is sold. This change in terms comes at a time where the company is gearing up to go public, and it is estimated that Snapchat is valued at $25 billion.

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