Is Facebook's new video property an advertising goldmine?

Facebook Watch goes live in the US bringing TV style long-form content to the platform. How long before it comes to India?

e4m by Abhinn Shreshtha
Published: Sep 7, 2017 7:53 AM  | 4 min read

Facebook is quietly taking its battle for online video supremacy with Google to the next level. The company announced on Wednesday that its new video content platform, Facebook Watch, which has been beta testing for a few months, has gone live for all US users. Watch is basically a reformatting of Facebook’s existing video tab but what makes it interesting is that it’s not just another content platform; this is a dedicated effort to collar the episodic and long form online video content market.

According to a report on Digiday, shows on Facebook Watch will fall under two categories; half-hour programs and shorter series with episodes running between five and 15 minutes. With Facebook Watch, the social media platform is giving creators, both amateurs and established publishers, the opportunity to develop shows that are subsidized by Facebook. Facebook users will now be able to subscribe to their favourite shows and content creators, similar to YouTube.

There are also reports circulating that Facebook will soon provide content creators the option to bring on-board advertisers on their shows. Some of the big names already a part of the program include the likes of Business Insider, Discovery, Hearst, Bleacher Report and Conde Nast among others.

Though there is no word yet on when we can expect a global launch, this launch should be of definite interest to video marketers and content creators in India.

“I expect that Facebook Watch will take at least a year to expand its reach to the targeted millennials driving video consumption in India. The expansion and outreach of Facebook Watch will also depend on the engagement, content and experience of the consumers,” said Vikas Katoch, Founder and CEO, Adomantra Digital India.

Video has become one of the most significant content types on Facebook and it is also something that the company is focusing extensively on. Given the size of Facebook’s user base and the fact that it promises to bring down the cost of creating video content for publishers, it seems like YouTube has its work cut out. But for the advertiser, the opportunity to insert ads into content that is subscribed and does not randomly appear on the timeline, smells like a great marketing opportunity.

“If the offered content is successful, this is an advertising goldmine. Facebook allows advertisers advanced micro targeting with the drawback that you have to create your own content to leverage it and the launch of Facebook Watch changes that. Content developed will spread across a wide spectrum of target groups allowing advertisers to select the content most suitable to their brand,” opined Abhishek Gupta, Founder & CEO, Sterling AG.

The likes of Netflix, Amazon, Vuclip, Voot and a plethora of other OTT players are spending huge amounts in creating, acquiring and marketing exclusive content. The entry of Facebook with its financial muscle might create imbalance in the current equation.

“The biggest threat to OTT players will be the massive user base that Facebook commands. While OTT players normally have to raise a large amount of capital to create their content (Netflix raised a cool $20 billion,) recovering the capital is a different story all together. If Facebook operates mostly on a revenue share basis, this allows them to propel a massive amount of content with relatively low downsides,” opined Gupta.

However, Subrat Kar, Co-founder and CEO at Vidooly, feels that Facebook Watch might not be the game changer that it wants to portray itself as. “OTT players like Netflix, VOOT and Amazon Prime are leagues ahead in terms of production value. YouTube TV’s key demographic audience are millennials. Even though Facebook Watch is trying to lure as many quality content creators as possible, they can’t create binge worthy content like Game of Thrones or Narcos,” he told us.

Katoch also pointed out that given the huge market for online video content and a market only expected to expand, there was low possibility of any major impact on OTT players in the medium to short term.

On the technical side, Kar also explained why he felt that videos worked differently on Facebook and YouTube. “In this analytics obsessed world, there is a lot of difference between sharing a YouTube video on Facebook and embedding a video natively on Facebook. The other most important factor is the ‘View’ count. Facebook counts the ‘View’ at the three-second mark, whereas YouTube counts views in a logical way. So, in the long run, creators might understand the difference but right now they are trying to ride the wave,” he said.

However, he did agree that with Facebook promising creators the major portion of revenue earned from ‘ad breaks,’ the vast social footfall could be enough to divert many brands there.

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