Facebook’s Next Business Should Be Video

Today’s post is brought by YesVideo’s CEO, Michael Chang – Providing his digital video expertise to support his insight on why the social media giant, Facebook, should make its towards video technology. This article was also featured on Wired.com’s Innovation Insights.

We joke that we’re not friends unless we’re Facebook friends – but there’s some truth to it, isn’t there? Facebook has firmly entrenched itself into the lives of the majority of Americans – in fact, more than 163 million Americans –52 percent of us – currently have accounts.

We’ve grown accustomed to “liking” our friends’ statuses; we send out birthday greetings; we follow the pages of companies and personalities we like; and of course we share our own updates, photos and links, a surprising number of which are related to cats. On average, Americans use Facebook for at least 13 minutes a day, every day of the year. Certainly, Facebook has answered the call to most of our digital needs – and via Facebook ads, the social network appears to have found the answer to their revenue needs.

And yet there is one area in which Facebook could provide a stronger user experience, and make money at the same time: video. I believe there could be a real revenue opportunity for Zuckerburg and Co if they move now to make a real play in the space and show YouTube that they have competition. Facebook hasn’t shied away from battling Google over the years. This is apparent with Graph Search, literally aiming to best Google at its cash cow core. But going after video could potentially cut into another rapidly rising Google asset.

While it’s true that we all can upload videos right now to Facebook, the process isn’t as quick and easy as it could be. And while we can link to videos hosted by streaming sites such as YouTube and Vimeo, creating and editing video on Facebook itself is not really an option. Facebook falls short in their assumption that we will always post something that’s already been created elsewhere.

In so doing, Facebook essentially steps back and defers to YouTube, making the tacit assumption that YouTube “owns” videos. But users of Facebook and YouTube currently spend about the same length of time on both sites each day, so there’s no clear superiority between them. We use Facebook to connect with our friends, and we watch videos on YouTube for entertainment; but these separate categories of “social” and “video” are becoming increasingly blurry.

YouTube has been making strong attempts to become more like a social network, enabling its users to set up personalized homepages where they can browse channels and set up personalized subscriptions. It tells us which videos our friends have recently shared on their Google+, Twitter and Facebook accounts. We can even post private videos on YouTube that only our friends, not the public, can see.

But Facebook is still chugging along as though nothing has changed, despite the changes in the environment. Its video capability remains so wobbly that it actually has a video instruction page entitled “Bugs & Known Issues.”
But there are some ways that Facebook can beef up its video strategy, and monetize the offerings as well.

Here’s how:

1. Video birthday cards

Facebook already reminds users about their friends’ birthdays. They have a fine system in place that sends out reminders and encourages us to quickly post birthday greetings on the walls of birthday celebrants.

In addition to these simple greetings, Facebook should consider allowing users to send video cards – Vcards – to friends also. Simply surround an embedded video with a decorative golden frame that bears a birthday greeting, and make it postable. Imagine Grandma’s delight and surprise when she receives a framed Vcard showing her twin grandkids jumping up and down on the bed, shrieking “Happy birthday, Nana!” Or if your best pal happens to be an aspiring musician, post a framed Vcard on his wall showing his favorite rockstar in mid-shred. The possibilities are endless; all Facebook needs to do is provide a small assortment of custom frames with a line for a customized greeting.

As for revenue, perhaps each user could send one Vcard free per month or year, and after that, a small cost is associated to it.

2. Provide rudimentary video editing tools

People truly want a quick on-and-off user experience, and it’s not particularly swift or easy to edit a video. But Facebook could make it easier than it is by offering novice users a suite of user-friendly, step-by-step, instructions for “Editing 101”. The results might not win Sundance awards, but they would be superior to uploads of untweaked smartphone videos. If the instructions could be made simple enough to be mastered by a fifty-something grandmother, or a 13-year-old, it would be a huge act of technical empowerment that would result in countless happy users.

Vimeo, for instance, welcomes novices and gives them fun, hands-on lessons in elementary editing on its “Vimeo Video School” pages. Vimeo would be another great acquisition target for The Social Network. But Vimeo isn’t the only option…

3. Acquire a video streaming site

Facebook paid at least $715 million for Instagram in order to better enable its users to post edited photo uploads. Perhaps it’s time for Facebook to consider purchasing one of the many websites that enable video uploads. Possible acquisitions could involve popular video hosting sites such as MetaCafe or Break.com, or live-streaming services such as Justin.tvor Ustream.

An acquisition of this type would allow Facebook to charge for certain content (or channels) that is exclusive to their users.

4. Improve Facebook’s video chat

Facebook video chat is often plagued by strobe-like intermittent motion as well as by visible lag-time between when you see your friend’s lips move and when the words are actually heard. Facebook needs to focus their time and energy on making this experience smooth and fun.

By improving v-chat and providing more sophisticated editing tools, Facebook could bring in more people like amateur and professional videographers and filmmakers. These folks could then use the network not only as a way to let their friends know about the short film they made, but also edit it, and post it easily. They could also host Q&A sessions with their fans. Imagine the millions of hours of engagement that a more robust video offering would provide for Facebook – and increased engagement translates to increased advertising opportunities.

It’s time for the world’s largest social network to improve its overall video experience and to encourage content creation by its users. And if they do it right, I believe there will be real revenue opportunities for them.
Do you think video could be a boon for Facebook? If so, how?

Read more: http://insights.wired.com/profiles/blogs/facebook-s-next-business-should-be-video-4-ways-zuck-can-make?xg_source=activity#ixzz2SC4DZ61X
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Michael Chang Photo

Michael Chang is CEO of YesVideo, the global leader in video transferring and sharing. He is responsible for defining the company’s market vision, and leading his team to continued success by creating innovative products and services for the millions of consumers that YesVideo serves.

Previously, Michael cofounded Greystripe, the largest brand focused mobile advertising network, and also served as CEO. ValueClick acquired Greystripe in 2011. Michael also worked at Incubic Venture Capital and was responsible for investments in Internet and software companies. Michael holds an MBA from Duke University’s Fuqua School of Business and a BS in EE from Carnegie Mellon University.