NEW YORK: YouTube says Facebook is not creating hurdles for its dominance of online video and both companies will be able to grow rapidly for years by cannibalising the television advertising market.
Robert Kyncl, head of content and business operations at YouTube, was quoted as saying by the Financial Times that the online video market was expanding so fast that “it will be a decade before we bump into each other”. He said Facebook’s and other players’ arrival shows that online video is “becoming mainstream”, but it would not derail the YouTube juggernaut.
Facebook, which has 1.4 billion monthly active users, has been putting video ads into users’ feeds for more than a year. Recently, it muscled further into YouTube’s territory with a trial to share advertising revenue with video creators who publish on the social network.
Facebook will match the revenue split offered by YouTube, giving content creators 55 percent of the proceeds of ads that run next to their videos.
According to a previous report, Facebook confirmed that it is dabbling in video ads and sharing revenue with content creators, in a move that would compete with Google-owned YouTube. An advertising model being tested by the leading online social network is part of a “Suggested Videos” feature designed to recommend clips for people based on snippets they tune into in News Feed at Facebook.
Suggested videos are related to what is watched by members of the social network, perhaps focused on the same topics or posted by similar publishers. The feature is being tested for some people accessing the social network with iPhones, according to Facebook.
Revenue from ads appearing in the Suggested Videos feed will be shared, with 55% of the money going to those providing the content, according to Facebook. The California-based social network said that it is not taking any money in from advertising while it tinkers with the formula for serving up video marketing messages.
