The online-video landscape is turning into something of a bidding war, with platforms trying to convince media companies and celebrities to use their services, and Facebook in particular seems to be willing to come up with cold, hard cash in order to get the content it wants on Facebook Live.
We already know that the giant social network is paying media outlets such as the New York Times and BuzzFeed millions of dollars each in order to produce a certain number of videos per month for its live-streaming service. BuzzFeed alone is getting $3 million, according to documents obtained by the Wall Street Journal.
But Facebook (FB) also appears to be targeting up-and-coming independent video artists, the kind that more typically show up on YouTube or Twitter’s Vine platform, and it is paying them substantial sums.
For example, the Journal says it has seen documents that show Facebook is paying Vine star John Paul Piques $119,000 to post at least five videos on its live-streaming service over the next two months. That’s the equivalent of $24,000 per video. And he is just one of about two dozen other Internet celebrities and video stars who have signed similar deals.
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The newspaper says the highest-paid independent video performer appears to be Ray William Johnson, who developed a following for a YouTube show called “The Equals Three Show,” in which he makes fun of viral videos. He could make as much as $224,000 over the next six months.
The company is also paying significant sums to celebrities from other fields to get them to use its service, including Pittsburgh Steelers football player Antonio Brown, swimmer Michael Phelps, and actor George Takei.
Justin Osofsky, Facebook’s vice president of global operations and media partnerships, told the Journal that these arrangements aren’t an “acquisition strategy to go after Vine and YouTube stars.” But that seems to be exactly what they are. If Facebook can convince enough viral stars to use its platform exclusively, then it has a built-in content machine ready to fuel its video strategy.
Facebook will be all video in 5 years:
One of the reasons for the upfront payment approach is that Facebook hasn’t rolled out a monetization strategy for video yet. The social network seems to have rejected the idea of pre-roll ads on videos, so it’s not clear how it will generate revenue, or how much it will share with creators.
YouTube (GOOG) is trying to move from an advertising-based model for its videos to a subscription approach with the recent launch of its YouTube Red service, which allows creators to share in the proceeds. But Twitter hasn’t done much to help its Vine stars generate income, which could make them easy prey for Facebook or YouTube.
Twitter seems to be spending more of its time and resources on signing deals to stream professional video content from partners such as the NFL, CBS, and the NBA. The company has announced half a dozen partnerships over the past few months, with the latest being an expanded deal with the NBA to show basketball-related content via Twitter, Vine and its other video service, Periscope.