Facebook’s reach broadens with retail, payments and entertainment in its sights
At the end of August Facebook, Inc. launched its new Watch video service to US users – as part of a strategy to compete with YouTube for advertising revenue – as more and more budget gets diverted away from television to online.
Facebook began testing Watch in early August, allowing users view content provided by Vox; Buzzfeed; Discovery Communications, Inc.; Walt Disney Co’s ABC and Major League Baseball. Facebook itself is not about to rival Netflix in the sphere of producing original content, rather be the channel for distribution.
The market is large as Americans spend over 73 minutes per day watching digital video, according to eMarketer data, up 7% from last year. Television viewing has dropped off by 2% to 244 minutes per day, and both trends are expected to continue.
Dan Rose, VP of Partnerships, announced that Facebook plans to eventually open the platform up to all to submit shows for approval and content providers will receive a 55% share of ad revenue.
A virtual marketplace
Also in August, Facebook rolled out Marketplace to 17 countries across Europe (Austria, Belgium, the Czech Republic, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden and Switzerland). Marketplace had already expanded to six countries (Australia, Canada, Chile, Mexico, New Zealand and the UK). Marketplace is, as the name suggests, an online marketplace for users to discover, buy and sell goods in their local communities, with the aim of giving users a greater sense of security about buying from a stranger, being able to view their public profile or mutual friends.
Feeling out the fintech space
These moves into the entertainment and retail spaces follow successful 2015 US rollout of a payments feature in Facebook Messenger, which allows users to connect Visa or Mastercard debit card and send money to friends, with no transaction fees. In April this year the service expanded to allow group payments. Facebook has claimed its interest is not in building a payments business, but rather making Messenger more useful to gain a competitive edge against rivals – for example China’s WeChat already supports in-app payments.
Facebook: the facts
Be it payments or entertainment, any move by Facebook into a sector is cause for other players to worry. Globally, there are more than 2.01 billion monthly active Facebook users, with figures growing 17% since last year. On average 1.32 billion of those users log on once a day. The scope is phenomenal, and while Watch and the payments feature are currently local to US users, it is surely only a matter of time until that global user-base is included.
Facebook’s Dublin headquarters is an important hub of activity, with their operations here having mushroomed from 30 employees in 2008 to the current figure standing at over 1,500 employees and headed up by country lead Gareth Lambe. Lambe also sits on the Board of Directors for Facebook Ireland, Oculus VR Ireland and Facebook Payments International, placing him in the midst of some of the most exciting tech sectors – virtual reality and fintech.