Facebook Inc (NASDAQ:FB) may be in the process of mounting an under-the-radar challenge to YouTube in video. While much has been made of Amazon’s recent purchase of Twitch and the challenge it may signal to YouTube coming from the online retail giant, as Re/Code reported today, a more imminent and worrisome challenge is being launched by Facebook Inc (NASDAQ:FB).
The initial growth in video views on Facebook Inc (NASDAQ:FB) was a result of the social media giant’s switch to autoplaying videos last fall. From there they slowly ramped up video playback for those users who seemed to be engaged in the content. The results have been exceptional this summer, in part thanks to the Ice Bucket Challenge phemonemon, which has single-handedly generated 10 billion video views this summer.
One of Facebook Inc (NASDAQ:FB)’s major content providers, BuzzFeed, has grown from 130 million views in June this year, to just under 600 million views in August, a more than four-fold increase in the span of just two months. In terms of sharing, Facebook Inc (NASDAQ:FB) has seen 50% growth in organic views over each of the two months from May to July. The additions of hit-counters and like buttons on videos are bringing further engagement to video viewing audiences on the site.
The big challenge for Facebook Inc (NASDAQ:FB) will be maintaining interest in their video content and making the site a destination for video, not just a new way for advertisers to reach users. The advantage Facebook Inc (NASDAQ:FB) has even over YouTube is the embedded culture of sharing and engagement on the site, and the ability to comment on and share content amongst your own friends in a more organic way, which greatly trumps getting a link to a YouTube video in your email and feeling rather disconnected from the whole process.
The Citadel Investment Group is one of the largest shareholders in Facebook Inc (NASDAQ:FB), with just over 4.5 million shares in the social media giant as of their June 30, 13F filing. The hedge fund is managed by Ken Griffin.
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