Facebook may be a latecomer to the streaming video market, but the company thinks it can generate money by making it more social.
"Video has always been social, even before the internet, when everybody was watching the same few channels," said Fidji Simo, Facebook's head of video, in an interview. "Everyone was talking about their favorite shows around the water cooler."
For Facebook, the challenge is not to mimic Netflix or YouTube, which have built successful models on the backs of consumers who binge watch, but to get people to watch shows together again, even when they're viewing from their phones or other personal devices.
"We can do that because all of your friends are on Facebook," Simo said.
There's a ton of money at stake. While digital advertising is increasing, brands only spend about $13 billion a year on online video according to Andy Fisher, chief analytics officer at marketing agency Merkle. Meanwhile, $70 billion a year in the U.S. is still spent on TV ads, said eMarketer.
To get a bigger piece of the pie, Facebook is boosting its investment in Facebook Watch, a video service announced a year ago, which includes original shows and other TV-like content. Earlier this year, the company started talking to media buyers about allowing shorter ad-supported content, and in June talked to social media stars about broadening ad opportunities.
On Thursday, Facebook expanded Watchacross the the world. Until now, it's only been available in the U.S., with shows, live sporting events and shorter clips from online creators and media companies. About 50 million people in the U.S. watched videos for at least one minute a month, according to Facebook.
Frederick M. Brown | Getty Images
Fidji Simo, Director of Product at Facebook
The company added opened Watch to all pages and creators after realizing people wanted "the ability to catch up on their favorite niche creators," Simo said.
It's also now giving creators in five countries — U.S., U.K., Ireland, Australia and New Zealand — the opportunity to earn ad revenue. To be eligible, videos must be at least three minutes long and be produced by people with 10,000 followers. Clips have to attract 30,000 views that last at least one minute over a two-month period. Creators earn 55 percent of the advertising dollars, with Facebook keeping the rest, and the company plans to add many more countries soon.
To get users together, Facebook has features like Watch Party, which lets people watch alongside friends. There's also game show-style programming and options to influence content in real-time through polling.
"We are fundamentally different," Simo said. "We are really not focused on passive consumption of video. We are focused on building communities and connections around videos."
News Feed is also becoming a bigger place for video. The more videos a user watches and shares, the more they're served.
"What we really want to prioritize is content from your friends and family," Simo said. "We expect that a lot of that will evolve to video in the future because that is the content that people want more and more."
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