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Facebook to Test Video Download Tools in India from Jul 11

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Facebook, Inc. (FB - Free Report) will apparently test a new video download option for offline viewing in India. Per media reports, beginning Jul 11, select Indian users will be able to download videos on the social media app, which can be viewed later in offline mode.

Per media reports, Facebook had notified publishers through an email saying “In markets like India, mobile data and connectivity are limited, which can leave people with poor video experiences or no streaming ability at all. We want to make the video experience on Facebook great for people in all parts of the world.”

Details of the Program

Publishers on their part will have the option of opting out of this arrangement as per their preference though the social media company believes that this move will ensure a wider audience for the content. As far as piracy issues are concerned, these video will only be available for viewing on the Facebook app, thereby curbing the scope of unauthorized distribution.

We believe that this is an important move for the company as it strives to deepen its foothold in emerging nations like India. Increasing data costs for viewing videos online is one of the chief headwinds in developing nations. With this move, users can download videos whenever they are using Wi-Fi connections and can watch them later offline.  In fact, it would probably also open doors for the company to make a push into the lucrative video ads space.

The Background

India, with a population over 1.2 billion, has only about 354 million Internet users (as per Sep 2015 data), of which a large section uses 2G or poor speed connections.,

To address this problem, Facebook had earlier taken initiatives like launching the Facebook Lite app (for lower speed networks), Free Basics (the controversial program that was scrapped in India), Acquila Drones (to beam free Internet in remote areas) and Slideshow (which gives a video like experience on using lower bandwidth). Moreover, recently, the company also initiated its OpenCellular project designed to provide wireless access in remote areas.

Even with low Internet penetration, India is already the second largest market for Facebook just after the U.S.  Furthermore, the rapid adoption of smartphones in India will undoubtedly lead to further growth. This has obviously drawn the interest of all major tech companies including Facebook, Twitter (TWTR - Free Report) , Alphabet (GOOGL - Free Report) and Amazon (AMZN - Free Report) .

At present, Facebook carries a Zacks Rank #3 (Hold).

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