Facebook Isn’t a Real Threat to YouTube … Yet

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IN THE PAST year, Facebook has moved aggressively into online video, turf long synonymous with YouTube, leading to the inevitable boxing metaphors. Facebook and YouTube are gearing up for a fight. Which will deliver the knockout blow?

But the story isn’t that simple.

The antagonism between the two behemoths appeared to ratchet up earlier this month when YouTube celeb Hank Green vented his frustrations over Facebook’s current video setup. He complained about how Facebook measures video views; what he saw as its fast-and-loose attitude to copyright; and how its News Feed seems to prefer videos hosted on the service rather than those from somewhere else.

Green’s complaints shined a very public spotlight on the concerns of many video creators who make a living on YouTube as Facebook barrels onto the online video scene. But to say that those creators are “battling” Facebook oversimplifies the situation. Yes, these creators want to protect their work. But they want to work with Facebook—and reach its gigantic audience—too.

Despite the proliferation of cat videos on both, Facebook and YouTube are very different places in some ways. You go to Facebook to check out what’s going on with your friends. You go to YouTube to watch music videos or trailers. In theory, the two companies can coexist. The only question is where advertisers will place more of their dollars and if Facebook’s entrance into video means some of those dollars stray from YouTube.
Facebook’s Views

For Facebook, video is relatively new. But the company is touting some impressive stats. In its earnings call in April, Facebook executives said the platform was serving up four billion video views daily.

The problem, Green and others say, is in how Facebook defines “views.” A view, by Facebook’s measure, is anything longer than three seconds of an autoplayed video. That’s a pretty crazy metric when you consider the time it takes to scroll through your feed, see something moving, realize what’s happening, and decide whether to watch or move on.

YouTube, for its part, says it no longer uses “views” as its metric of choice to determine the success of its videos, opting instead for “watch time.” Since 2012, the company has said that “watch time” demonstrates a more compelling picture of user engagement—that is, whether and how much attention someone is actually paying to a video.

The metric matters—for Facebook, YouTube, and creators that have built businesses around web video—because it helps determine how much a video is worth to advertisers. If Facebook gets billions of eyeballs on its videos each day, then it can get advertisers to pay more than if it reached, say, hundreds.

Facebook defends its three second metric. Matt Pakes, a product manager for video at the company, argues that Facebook needs one consistent metric to capture a “view” for all its video content, including, say, a six second vine clip as well as a 10 minute video episode. Three seconds, the company says, is also the industry standard. And yet Facebook recently announced that it will now allow advertisers to opt to pay for a video ad only if viewers watched it for at least 10 seconds, indicating perhaps that advertisers want, well, a bit more time to make sure their message is truly seen.
Freebooting

The second issue for Facebook is the allegation that most of the company’s views are coming from content that has been ripped from other places on the web in a process known as “freebooting.” Videos uploaded on Facebook’s own system pop up in News Feeds more frequently, so users will take content from YouTube that, in the cases of “freebooting,” does not belong to them, put it into Facebook’s system, and upload it on the site.

Green cites an Ogilvy and Tubular Labs report that says that725 of the 1000 most popular Facebook videos in the first quarter of this year were stolen from somewhere else, meaning that 72.5 percent of Facebook’s popular videos during that period were actually uploaded from places like YouTube.

That’s a problem for content creators, who can’t make money off their stuff if it’s been stolen and uploaded. But it’s also a problem for Facebook, which will need those creators if it wants to host videos viewers actually want to watch. Advertisers, after all, want to be where the viewers are.

Facebook says that it’s well aware of the problem, and is working on better solutions to measures currently in place. But YouTube has already mostly solved this problem. Launched in 2007, YouTube’s Content ID system analyzes videos uploaded to the site against a massive database of known video and audio content. If a video is stolen, or a song is used that’s copyrighted, the rights holder is notified and can decide how to proceed against the violator.
Everyone’s Doing It

While it might seem like Facebook, Snapchat, Twitter, and pretty much every other social network and publisher are getting into video, YouTube says all that growth has helped, not hurt. The company says the number of people watching YouTube per day is up 40 percent year over year since March 2014. More and more users are coming to YouTube directly via the homepage, the company says, much like they’d turn on a TV.

So, sure, advertisers may want to spend more money on Facebook—and they will. Facebook is able to offer up incredible opportunities for advertisers to directly target individuals based on a host of intimate details about their lives and likes. But when it comes to video advertising, it’s not yet clear that Facebook is able to command the attention that YouTube has been able to prove with its more tailored metrics.

Yet even those comparisons suggest a winner-take-all scenario that probably doesn’t exist. Facebook and YouTube are different services, and there’s value for content creators—and advertisers—for being in both places. “Facebook is for scrolling through, talking to friends, seeing updates, distracting yourself,” Green tells me. “But when I’m on YouTube, I’m there to watch things I want to watch.”

Viewers go to YouTube explicitly to watch videos, which means advertisers looking to appeal to people who are paying attention to video may want to head there. Facebook is a place where people go when they’re bored, or want to see what’s going on in the world. That doesn’t mean people aren’t paying attention to videos in Facebook’s News Feed—they can, and many likely are. It does mean that advertisers may face a greater challenge in getting users to stop in the midst of their scroll. Still, the one thing Facebook can offer above all is the promise of eyeballs scanning for anything that will arrest their attention. If they can make videos that get people to stop and look, then Facebook is where they’ll want to be, too.