Facebook unveils video streaming service

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Social media giant Facebook introduced its Watch video service to US users on Thursday with plans to allow the consumer to submit shows, as it competes with Alphabet’s YouTube for advertising revenue.

Advertisers are shifting more of their budgets from television to online as viewers have migrated to watching shows on smartphones and tablets.

On Watch, which Facebook began testing earlier this month, users can see hundreds of shows from the likes of Vox, Buzzfeed, Discovery Communications Inc, A&E Networks, Walt Disney Co’s ABC, as well as live sports like Major League Baseball.

Watch on mobile /Facebook Photo

Americans spend more than 73 minutes a day watching digital video, up more than 7 percent from last year, according to eMarketer data. TV watching has dropped 2 percent from last year to 244 minutes a day, a trend that is expected to continue.

Facebook is initially paying some content creators for shows to drive interest. The company is paying 10,000-35,000 US dollars for shorter form shows and up to 250,000 US dollars for longer shows, sources told reporters in May.

The company declined to comment on how much it was spending on shows.

Watch on PC /Facebook Photo

Facebook does not intend to make buying content a core piece of its strategy, Dan Rose, vice president of partnerships at Facebook, told reporters.

“We are not focused on acquiring exclusive rights,” he said. “The idea is to seed this with good content.”

Facebook plans to eventually open the platform to everyone to submit shows for approval and share 55 percent of ad revenue, Rose said.

The company is testing how ads will work within the shows, he added.

Reuters Photo

Watch should help Facebook solidify its position alongside YouTube, the leader in the digital video space, for advertisers, said Paul Verna, a senior analyst with eMarketer.

Facebook said Watch is more personal and community-oriented than competitors. For example, it can suggest shows based on a user’s interests and friends can share their thoughts as they watch a video.

For example, fans of the exercise program “CrossFit” can watch and share commentary on live CrossFit events streamed on Facebook while chatting in groups, Rose said.

Similarly, fans of Spanish soccer can watch and chat online about “Hala Madrid,” a show about Real Madrid.

“We think our unique opportunity is around community and engaging with people on topics they love to talk about,” said Rose.

YouTube CEO Susan Wojcicki and Facebook CEO Mark Zuckerberg are now direct rivals, due to Facebook’s new Watch service. /Reuters Photo

Source(s): Reuters