In a bid to further its push into the world of original content, Facebook Inc (FB - Free Report) has unveiled a new tab called “Watch” that will be exclusively dedicated to video viewing.
Per Facebook’s blog post, Watch will help users find videos from outside their news feed and will be available on mobile, TV apps and desktops/laptop. Watchlist feature of the tab will help users to easily follow their favorite shows. Apart from Watchlist, there will be other tabs like “Most Talked About”, “What’s Making People Laugh,” and “What Friends Are Watching” to help users discover a variety of new shows, adds the company’s blog post. “Watch” will be initially rolled out to selected users in the U.S.
Shows that will be available on Watch will include variety of genres ranging from cooking shows to documentaries to reality shows. Per reports, some of the shows that will be available on Watch include Tastemade’s Kitchen Little (cooking show for kids), National Geographic’s “Safari Live”, NASA’s “Science @ NASA”, Gabby Bernstein (motivational series), A&E’s “Bae or Bail” (reality show). Also, Major League Baseball games and Liga MX games will also be available on Watch.
In a blog post, Facebook said that creators will be able to make money by inserting ad breaks over time. Facebook is currently testing ad breaks. Facebook will reportedly be sharing revenues with creators in the 55:45 ratio, similar to Alphabet’s (GOOGL - Free Report) YouTube.
Why the Push into Original Programming?
Many tech giants are eyeing the lucrative market of original programming. As the number of cord cutters increase, streaming services are become the next big business opportunity.
Facebook remains hawk eyed on boosting video viewing on its platform. This is to bring in more ad dollars, which remain the mainstay of the company’s revenues with over 95% contribution. In May this year, Facebook reportedly brought on board several content creators like ATTN, Vox Media, BuzzFeed and Group Nine Media(which target mostly millennials) to produce shows for its upcoming video service.
Facebook had also unveiled a new TV app to enhance the video viewing experience. The app will be initially available on app stores on Apple TV, Amazon Fire TV and Samsung Smart TV and will be rolled out to other platforms gradually.
Other Tech Behemoths Eyeing this Lucrative Field
Besides Facebook, a host of other social media sites like Twitter and Snap Inc (SNAP - Free Report) are trying to incorporate more and more video oriented content to bring in more ad dollars.
Recently, Snap, the parent company of Snapchat, inked a two-year $100 million content deal with media giant, Time Warner Inc. Under the terms of the deal, Time Warner will be creating 10 shows for Snapchat across various genres. Popular talk shows like Ellen DeGeneres and Samantha Bee could also be available on Snapchat, per reports.
Even tech behemoths like Apple Inc are foraying into this arena. In Jun 2017, close on the heels of announcing its first reality TV series, Planet of the Apps, the Cupertino-based tech giant also brought on board two top TV executives – Jamie Erlicht and Zack Van Amburg – to manage its video-programming efforts. Both Erlicht and Amburg were with Sony Corp (SNE) for the last 12 years, serving as presidents of Sony Pictures Television.
In addition to Planet of Apps, other series in the pipeline include documentaries on Sean Combs and Clive Davis, as well as Carpool Karaoke, a series based on a segment of James Corden’s Late Late Show.
Despite being lucrative, this field is highly competitive. It is a well-known fact that YouTube is synonymous to video viewing. Also, Netflix (NFLX - Free Report) and Amazon are the other top competitors in this arena with their award winning series. Reportedly, Netflix and Amazon will be spending $6 billion and $4.5 billion on content this year, respectively.
Zacks Rank and Share Price Movement
At present, Facebook carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company has outperformed the industry in the last one year. Facebook’s shares have increased 37.1% compared with the industry’s gain of 13.9%.
One Simple Trading Idea
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
This proven stock-picking system is grounded on a single big idea that can be fortune shaping and life changing. You can apply it to your portfolio starting today.
Learn more >>