On January 26th, Facebook’s newsroom posted an article explaining how the Menlo Park company ‘accounts for video completion rates‘ on their social network. In it, they detail a recent change to newsfeed where video completion rate for longer videos is weighted more strongly then that of shorter videos, leading to an increase in views for longform video-content. Combined with tests of mid-roll video ads, revenue sharing for publishers and an influx of new content creators, Facebook is going head to head with YouTube, the world’s biggest video platform (for now). In the following article, we’ll dive a bit deeper into this clash of titans.
Apples and Pears: The Current State of the Industry
People are watching a ton of videos on Facebook. Billions of views per day, reportedly. There’s an issue though. A Facebook video view is not the same thing as a YouTube video view and a Snapchat video view is something else entirely. As such, comparing where and how much video is watched, can only be done using hours viewed:
An average of 100 million hours of video is watched on Facebook daily (Jan 2016)
‘Guesstimates’ put YouTube’s daily hours of video watched at roughly 650 million (Jan 2016)
Both numbers are somewhat outdated and both have likely grown quite a bit since these numbers were reported. It’s safe to assume that YouTube still leads by a fair margin, though. Even though Snapchat has started reporting on the number of daily video views they generate (a reported 10 billion), their content is inherently different from the content being presented on YouTube and Facebook. Snapchat videos are (usually) presented in portrait mode and are generally shorter. A Snapchat video view is also much more likely to be a user-to-user video, in stead of videos shared publicly.
What’s coming for video on Facebook
Facebook is all about video. Late last year, Facebook COO Sheryl Sandberg stated that the social network expects 70% of their mobile traffic to be generated by videos by 2020. To further this goal, Facebook is constantly developing their video-proposition. These are the most important recent developments and developments we can expect in the near future.
2017 won’t be about live video for Facebook
2016 was the year of live video. Telescope, YouTube Live and Facebook Live grabbed headlines by showing massive growth. Facebook reportedly fueled quite a bit of that growth by pulling out its wallet and paying publishers more than $50 million to create live content. Even though live social video worked wonders for some traditional broadcasters and content creators, in 2017 Facebook is de-emphasizing live video as they look for longform content in the vain of full-fledged TV-style shows. Over the last couple of weeks reports started leaking that content creators that got paid specifically to create live video for the platform, are noticing no mention of the format in new conversations with the social network. Apparently the guys and girls from Menlo Park are still spending heavily on an ad campaign promoting live video, but do so targeting ‘regular users’, not publishers or celebrities.
Mid-rolls help monetize video content
Last year, Facebook made the creation of video content for their platform quite a bit more lucrative when it allowed creators to publish branded content. Verified profiles and pages can use this feature to tag sponsored content that was produced in cooperation with – or for – an advertiser. Facebook doesn’t get a revenue share on these deals, but as they require direct cooperation with an advertiser their use is rather limited. Even before then, select creators would receive a revenue share on ads shown between the videos in the suggested videos feed. Those two programs are set to be expanded on in 2017 as stories have surfaced that the social network will start incorporating mid-roll ads in videos 90 seconds and longer. When enabled, 15 second video ads will play after 20 seconds of the main video have elapsed, presenting a powerful new way to monetize video content on the platform. Content creators will receive 55% of the revenue generated by these ads, which is on par with the rev share in place for participants in the YouTube partner program. Time will tell if this is enough to tease away some of the YouTube stars that have found Google’s video platform
Longer videos get some newsfeed love
Facebook’s newsfeed algorithm is the stuff of legends. Nobody knows exactly how it works, but every so often, the big blue network gives us a peek under the hood. On January 26th, product manager Abhishek Bapna and research scientist Seyoung Parktook to the Facebook newsroom to explain a recent change to how video is handled in newsfeed. Alongside fullscreen use, enabling sound and obvious social signals like ‘Liking’, the network also looks at completion rate when judging how engaged viewers are with a video. As this was previously looked at as a percentage of the total video, it actually favored shortform video as a user is much more likely to complete a 30 second video then a 3 minute video. From now on, completion rate on those longer videos will be weighted more heavily, likely resulting in an increase in views for longer videos over shorter videos. Together with mid-roll ads only triggering for videos over 90 seconds long, this should motivate creators to post longer video content.
Facebook on your set-top box?
Through sources at Apple, the Wall Street Journal recently learned that Facebook is working on an app for AppleTV, as well for other set-top boxes and smart TV’s. The app will focus on long-form video content and could be the place where original video content will flourish for the social network. Ricky van Veen, CollegeHumor alumni, joined Facebook last year in a position many expect to be centered around the acquisition of original scripted and unscripted video content.
Soon on YouTube
With Facebook breathing down it’s neck, Google isn’t sitting still and has quite a lot planned for YouTube in the near future.
YouTube as Google’s social network
Apparently this functionality is already live in the iOS and Android YouTube apps in Canada, but the rest of the world is likely soon to follow: In-app messaging on YouTube. It seems to have all the standard bells and whistles you’d expect from a messaging app, with the ability to send text, videos and links, but from within the YouTube application. As YouTube videos make up a sizable chunk of all content shared through other messaging apps, this simply seems to be a play to keep those users within the YouTube environment.
Leveraging search intel for YouTube ad targeting
According to a recent post to the Google Inside AdWords blog by Diya Jolly, YouTube product management director, Google will soon allow advertisers to target ads based on ‘cloud tracking’. This means nothing more then using Google account data to target ads on YouTube. If you’re logged in while you search on Google and then visit YouTube while logged in to the same account, that search activity can be used to target the ads you’re shown. This will, in time, replace YouTube’s reliance on pixels and cookies. As better tracking and targeting directly correlated to the revenue generated by ads, this will likely result in an increase in average eCPMs on YouTube. Thanks to rev sharing, this should in turn ‘trickle down’ to content creators that are part of the YouTube partnership program.
As ‘intentional data’ (Someone has the intent to buy something, as evident by them entering a certain Google search) tends to be more valuable then data on interests (Someone might fall into the target demographic for this product, as evident by them liking a certain brand or item on Facebook), this development might further widen the gap in revenues generated by video on both platforms. To illustrate, in April of 2016 Moz ran an experiment comparing video ad CPM’s on Facebook and YouTube, which turned out that the latter’s CPM’s were roughly 4 times higher.
If Facebook wants to tease away creators from YouTube, this will be an area that’ll need some work. Even if the rev share percentages on both platform are the same (55% to the creator), a viewer will generate a lot less revenue on Facebook.
Going after Twitch’s live video audience
Earlier this year, YouTube launched the beta for Super Chat. A functionality reserved for live video viewing that allows commentors to have their comments pinned to the top of chat for a maximum of 5 hours…. For a price. Purchases will generate additional revenue for content creators, in a fashion similar to what’s found in the popular live (gaming) video platform Twitch. This is the latest move YouTube has made in efforts to gain foothold in the lucrative live streaming business. At the same time Twitch, once a gaming-specific subset of groundbreaking live streaming platform Justin.tv, is ramping up their efforts to appeal to a broader, non-gaming-specific audience.
YouTube Red roll-out in Europe and further
YouTube Red, YouTube’s subscription service, was launched in the US last year. Currently with a reported 1,5 million subs, the service allows ad-free access to YouTube, YouTube Music and original content created specifically for the paid service. According to the Telegraph, the service is about to launch in Europe with the UK set to launch first and the rest of the continent to follow at some later point.
Who will win: YouTube or Facebook?
It’s to early to say who will win the battle for internet video – or if there will even be a single winner. In the foreseeable future, higher CPMs and a more robust suite of monetization options for creators will probably keep YouTube the network of choice for creators. At the same time, Facebook will see growth in content from traditional publishers who value reach over CPMs, live video and end-user generated content. On the long term, Facebook will need to offer better discovery and recommendation features for video content, as it takes aim – not just at YouTube – but also at other video services that vie for the attention of end-users.
Divitel and Social Video
At Divitel we pride ourself on being able to work with – and on – video delivery in every possible format. In our capacity as independent video systems integrator and all-round video solutions providers we’ve helped multiple broadcasters integrate social video streaming capabilities. By modifying existing internal software, unique stream keys could be generated and transferred to the encoding software off premises, without the necessity of direct access. This allows directors to switch or duplicate a video feed to the live streaming service of their choice with the flick of a button.