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Facebook Targets YouTube with Revenue Sharing for Video Creators

Tim Maytom

Facebook Suggested VideoFacebook has been making massive strides over the last few years in including more video in its News Feed, but has been held back by the fact that YouTube is still the platform of choice for those making videos.

That may all change soon, however, with the announcement that Facebook will begin sharing ad revenue with video creators in a similar way to YouTube, in an effort to draw more polished content and, in turn, more eyes on its adverts.

The new mobile-first feature, called Suggested Videos, will differ to the standard video ads inserted into users' News Feeds. Instead, ads will be included between video content that has been produced professionally by major media companies, in a similar fashion to TV advertisements.

Mobile users who view a video in their News Feed will be targeted with a follow-up link to videos that Facebook thinks they might be interested, which will take them into the Suggested Video feature.

Video creators featured through Suggested Videos will receive 55 per cent of the ad revenues, the same proportion that creators receive on YouTube. However, the initiative seems largely aimed at professional media partners, rather than the legion of vloggers and creators who have made YouTube their home.

Initial media partners for the feature include the National Basketball Association, Hearst Corp., Funny or Die, Fox Sports and Tastemade, and reaction to the announcement from marketers has been positive, with many excited by the prospect of showing ads alongside high-quality content that, crucially, has the sound switched on by default, unlike Facebook's News Feed ads.

However, the feature may not have media partners knocking down Facebook's door to take part. The 55 per cent of ad revenues will be split among all video creators who produce content adjacent to a given ad, based on how long users watch each video.

For example, if a user spends one minute watching Fox Sports content, then two minutes watching NBA footage, with an advert inserted between the two, Facebook would take 55 per cent of that ad revenue, and give a third to Fox Sports and two thirds to the NBA.

Whether the move brings more video creators to Facebook remains to be seen, but regardless the announcement reaffirms Facebook's commitment to both mobile and video as the key to the future.