CNCB's Julia Boorstin joined this morning's "Squawk Alley" to report on the details surrounding the announcement from Twitter.
"Twitter is expanding its amplified publishing program beyond companies to allow individual content creators, once they're approved by the company, to check a box to have pre-roll ads run before their videos," Boorstin reported.
Creators will get 70% of the revenue, according to Boorstin's sources, a much more competitive rate than Alphabet's (GOOGL) YouTube, which she says is closer to 50-50.
"Twitter says its targeting the 35,000 content creators who are apart of Niche, which is the startup it bought last year which connects influencers on Vine and other platforms with brands," Boorstin noted.
Moreover, Twitter's plan is a way to strengthen itself against its competitors such as Facebook (FB) and YouTube for elite content creators that often bring in millions of devoted fans.
"Twitter is announcing this move to catch up with its rivals amid concern over disappointing revenue guidance, stagnated user growth, and harassment on the service," Boorstin said.
Shares of Twitter were higher during mid-morning trading on Tuesday.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate TWITTER INC as a Sell with a ratings score of D. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.
You can view the full analysis from the report here: TWTR