It was just over a year ago Facebook (NASDAQ: FB) launched Watch, the social networking company's response to YouTube. The video game platform has taken some time to get away, just roll out internationally in August. Meanwhile, Facebook launched IGTV during the summer to complete Watch, and Instagram generally has much greater growth potential than the well-known Facebook platform.
When Facebook's video enhancements grow, the company is now ready to share some updates.
400 million and counting
In a blog post today, Facebook says that Watch Now has over 400 million monthly active users (MAUs) and 75 million daily active users (DAUs). That the MAU figure is significant from the 50 million MAUs published in August, and at par value will constitute a respectable portion of the 2 billion viewers who visit Alphabet s (NASDAQ: GOOG ) 1
The DAU seems more engaged, and not just by definition. Facebooks say that DAUs spend 20 minutes a day on Watch, and "regularly returns to capture the videos they care about and watch longer periods."
Original content is part of Facebook's seeding strategy, and the company says it will renew four shows for another season: Five Points Sacred Lies Sorry for your loss and Huda Boss . Quite a lot, every tech giant is aggressively hunting for high quality original content in an effort to separate their respective video platforms and services. For example, Sorry for your loss which stars Elizabeth Olsen has been criticized and has 96% score on rotten tomatoes.
Revenue generation is a completely different challenge, but Facebook's apparent strategy will be to monetize Watch with ads, not as opposed to YouTube. By contrast, Apple is expected to complete a subscription fee for the upcoming video streaming service after an initial period of time when all content is available for free on Apple devices. That challenge is particularly true when it comes to news, which Facebook also contains on Watch. The information (subscription required) reports that Facebook reduces its payments to news, since the ad revenue has been relatively inadequate.
Facebook Watch is looking for a respectable start, but important questions about the platform's long-term viability remain. How much of your deduction will continue? Will content partners be able to monetize their videos as well as on YouTube? Would it make sense to consider a paid subscription option, even if the core Facebook platform is still available? Will expensive original content actually help make viewers see? Only time will tell.
Suzanne Frey, a leader in the Alphabet, is a member of The Motley Fool's Board. Evan Niu, CFA owns shares of AAPL and Facebook. Motley Fool owns and recommends Alphabet (A-shares), Alphabet (C-shares), AAPL and Facebook. Motley Fool has the following options: long January 2020 $ 150 calls on AAPL and short January 2020 $ 155 call AAPL. Motley Fool has an information rules.