Many people are making You tube money and soon we will have Facebook money. Facebook will start paying video creators who upload videos on the platform. That sounds amazing right? The company is launching a Suggested Videos feed that curates a sequence of clips, interspersed with adverts.
Videos that keep people watching for longer will earn a greater share of the revenue from the ads, with Facebook keeping 45% for itself. Facebook says its users clock up four billion video views daily. One expert said it posed a threat to YouTube.
“Facebook is aggressively moving into the video space,” said Eleni Marouli, advertising analyst at IHS consultancy.
“In December 2014, Facebook surpassed YouTube in views for the first time, and we predict YouTube will lose share from next year onwards.”
Some media industries have shown interest to it like the HBO said it would stream some of its programmes on Facebook. Offering a cash incentive could encourage more publishers to upload on the platform. While YouTube gives content creators 55% of the revenue from ads displayed before their videos, Facebook will split the 55% it is offering between several creators reports BBC.
YouTube gives content creators 55% of the revenue from ads displayed before their videos but Facebook will split the 55% it is offering between several creators.
“It’s not an unusual, or generous model,” said Ms Marouli. “But we could see a monetisation battle between Facebook and YouTube, to entice creators onto the platform. Facebook made $3.3bn (£2.1bn) in ad revenue in the first quarter of 2015, 73% of it from mobile ads.
“Facebook is very adaptable,” said Ms Marouli. “In 2012, they had zero mobile-ad revenue. In two years, they’ve raised that to over 60% of their ad income.
“Based on our forecasts, by 2018 Facebook will have 25% of online video ad revenue in Europe, and more in the US,” said Ms Marouli.
Facebook says it is testing the Suggested Videos feed for iPhone users in the US and that the revenue-sharing arrangement will not begin immediately. While YouTube allows most users to monetise their videos, Facebook says it is working with a group of media companies and chosen individuals for the time being. One likely concern for video creators is that it is more difficult to search for videos on Facebook than YouTube at the moment.
“The big players don’t need tech companies like Facebook and YouTube to get their content out,” she added.
“If they aren’t happy with the deal on offer, they could pull out completely, like Channel 4 did with YouTube.”