Snapchat launches Spotlight, a TikTok competitor

Why it matters: TikTok's explosive growth has put dominant American social media platforms on notice. In August, Facebook launched its TikTok competitor, called Reels. Several other apps, like Byte, Dubsmash and Triller, are trying to win over TikTok users with similar products.

Details: Beginning Monday, users in the U.S., Canada, Australia, New Zealand, the U.K., Ireland, Norway, Sweden, Denmark, Germany, and France will be able to see and submit videos to Spotlight, which will exist in a tab on the right side of their Snapchat home screen.

• Anyone can upload a video to Spotlight, but videos will only be visible to users' friends unless they specifically set them to be public (and eligible for the reward).
• The Spotlight algorithm works by surfacing the most engaging Snaps based on a users' personal preferences, including whether a user has positively or negatively engaged with similar content.
• It's built to avoid monotony by surfacing different types of videos, regardless of whether a user has engaged with them, that are intentionally inclusive of different types of content and creators.
• Each video gets distributed to at least 100 viewers. Those that get the highest engagement get elevated to the next distribution tier of 1000 views. The tournament-style algorithm means that every piece of content is treated equally by Snapchat's distribution algorithm at the start.
• Snapchat will moderate all videos within their first 100 views. That initial review process includes both humans and software. All videos must adhere to Snapchat's existing community guidelines and content rules.

The $1 million cash prize is designed to reward creativity among a diverse set of users. To qualify, users must be 16 or older, and where applicable, obtain parental consent to earn the money. Snapchat says it will actively monitor for fraud and make sure the winners are original work.

• A spokesperson says that every piece of original content will be digitally watermarked to make sure that only the original creators can win the reward. The $1 million can be spread amongst multiple creators in a day.
• Snapchat isn’t alone in incentivizing creators with cash. In July, TikTok announced a $200 million creator fund that it says will grow to over $1 billion in the U.S. in the next 3 years.
• Facebook’s Instagram has also paid to lure TikTok creators to its platform.

Be smart: Snapchat realized it had to create something like Spotlight when it saw users creating videos with the Snap camera and then putting them on other platforms that had this type of algorithm.

• More than 4 billion videos are taken using Snapchat's camera on average daily, and those videos and pictures are often cross-posted elsewhere.

Between the lines: Snapchat already has video tabs, but they serve separate functions, and Spotlight won't replace them.

• Users will still be able to upload videos to Snapchat's Our Stories tab to get them featured on Snapchat's Snap Map, which features content about places and events. For example, first responders have in the past looked to Our Stories to find videos of people trapped in buildings during disasters.
• Users will also still be able to upload content to My Stories to be able to share videos privately with friends who follow them.
• Snapchat's curated video section, Discover, which features professional-grade content, will also remain. In the future, a Snapchat spokesperson says it does plan to integrate premium content into Spotlight.

Snapchat has two big ways to differentiate Spotlight from TikTok.

• Spotlight is private by default, and doesn't include public comments — both unlike TikTok. These choices align Spotlight with Snapchat's emphasis on privacy and positive incentives for creators.
• Snapchat also hopes Spotlight will help its users leverage its augmented reality tools, like 3D filters. These features have always been Snapchat's strong suit.