Saturday, July 4, 2015

(The Big Disrupt) Facebook: Facebook Squares Up Against YouTube As Its Plan To Consume Our Time and Attention Takes Shape

It might sound obvious to say that we live in a world where time and data have because just as or even more important to businesses than their bottom line but looking at Facebook’s recent moves to offer publishers and video content creators a share of ad revenue derived from their content and the rumors of the social media giant talking to record labels about video content, it’s clear that Facebook has taken this observation to heart more than most.

Facebook plan to get content creators on side is obvious as Facebook makes its money off the time and information their users spend and share on their site and partnering with publishers and video creators to post content on their site directly helps Facebook sell its ad inventory to advertisers as their users spend and share more time and information on consuming the content they love.

Facebook’s strategy puts them in direct competition with YouTube, who are owned by Facebook’s real competitor, Google. It’s long been predicted that Facebook would at some point go up against YouTube but it’s a lopsided match up as Facebook has the huge advantage of not being as dependent on content creators as YouTube is as Facebook users engage with other as well the content. YouTube does have a comment section but it’s notoriously hostile and troll friendly.

Entrepreneur and investor Jason Calacanis was one of the few who saw this coming and right now must be rejoicing that Facebook is wooing content creators. Calacanis has been a long standing critic of the Google owned company’s attitude towards content creators from its revenue stunting 55/45 split to its tendency to favor its own key metrics over the key metrics of content creators.

Calacanis has also been particularly critical of YouTube’s reliance on Google regarding attracting advertisers and because of this, content creators are hit with the double whammy of having no real relationship with either advertisers or consumers as according to Calacanis ““You don’t own your customers. YouTube does,””[1].

While Facebook are offering video creators the same 55/45 split YouTube is offering, Facebook can offer more money despite the split to due to their reach. Facebook could offer a better user experience and make videos easier to find as according to Re/code “People don’t have to hunt to find your video — Facebook will show it to them. And those people don’t need to be following your Facebook Page, either”[2].

With its deal with HBO, it’s only a matter of time before Facebook make deals other cable and broadcast networks that see the promise of exposing their content to the company’s 4 billion a day audience.

In sum, if YouTube executives aren’t scrambling their brains attempting to come up with ways to compete with Facebook, it better start brainstorming and quickly as Facebook are clearly coming for blood.

[1] Quote by E. Vlessing, 2013,’s Jason Calacanis On Why He Turned Down YouTube Funding,
[2] K. Wagner, 2015, YouTube Beware: Facebook Will Start Sharing Ad Revenue With Video Creators,

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