Facebook Inc (FB - Free Report) has set up monetization eligibility standards to make it clear that creators and publishers, which meet its strict guidelines, will be eligible to earn money on its platform. The social media giant called it part of its efforts to improve products/experience for all its users and creators/advertisers by bringing more “clarity” and “transparency''.
Per Facebook, creator/publishers have to abide by its Community Standards, Payment Terms and Page Terms. Repeated failure to comply with these terms will result into removal of access to the company’s monetization features.
In the blog post, Facebook stated, “Creators and publishers must have an authentic, established presence on Facebook — they are who they represent themselves to be, and have had a profile or Page on Facebook for at least one month. Additionally, some of our features like Ad Breaks require a sufficient follower base, something that could extend to other features over time."
The company further added, “Those who share content that repeatedly violates our Content Guidelines for Monetization, share clickbait or sensationalism, or post misinformation and false news may be ineligible or may lose their eligibility to monetize.”
This move is widely seen as Facebook’s efforts to avoid brand safety issues, which plagued Google’s YouTube earlier this year.
This year in March, YouTube ran into trouble with advertisers as it was reported that some ads ran before some extremist videos, prompting advertisers to withdraw their ad spots, per media reports. Consequently, Google had to tighten its ad policy to lure advertisers back.
Per a Bloomberg report, the recent uproar caused by Facebook’s revelation of Russian accounts spending nearly $100,000 in ads ahead of the U.S. election has mounted advertisers' concerns. Already, advertisers have been wary as the service has been under fire for quite some time now given the extensive dissemination of fake news on its platform. The victory of Donald Trump is widely credited to fake news circulation on social media. Plus, there has been widespread speculation that Russia indeed meddled with 2016 U.S Presidential elections resulting in Trump’s victory.
Putting in place stringent measures like this is the need of the hour for Facebook as it launches its dedicated video viewing tab, Watch. The company is currently testing in-stream video ad breaks with publishers creating content for Watch.
Zacks Rank and Share Price Movement
Facebook carries a Zacks Rank #3 (Hold).
Notably, the company has outperformed the industry in the past year. Shares of Facebook have surged 35.4% compared with the industry’s 16.8% increase.
Stocks to Consider
Better-ranked stocks in the broader technology sector include Applied Materials (AMAT - Free Report) , Activision Blizzard (ATVI - Free Report) and FormFactor Inc (FORM - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Applied Materials, Activision and FormFactor is currently projected to be 17.1%, 13.6% and 16%, respectively.
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