Facebook Watch Suffers the Scroll

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Credit: Illustration by Ad Age

When Facebook this year named its YouTube-style video destination Watch, it was like a command for viewers to stop scrolling so fast and just ... watch.

Watch basketball's Ball family, watch reality dating shows, watch people travel and cook. Many of the shows came from top publishers like Business Insider, Hearst, The Atlantic and Time Inc., all striving for commercial viability in digital video.

But people have not tuned in to the Watch hub as expected, with the "vast majority" of video views still coming from the News Feed, publishers say.

"They are really struggling with how to figure out how to get users to consume the videos in Watch," says a publishing executive, speaking on condition of anonymity. "All of our views come from News Feed and not the Watch tab."

Facebook is now moving quickly to improve its offer. It is considering hiking the share of ad revenue that Watch creators get from 55 percent, a person familiar with the negotiations said.

Facebook will also test letting partners sell their own ad inventory, according to people familiar with the strategy. A Facebook representative confirmed that the company will run a limited test next year.

Letting partners sell their own shows to advertisers might help attract high-powered networks and studios to Watch, because some of the more prestigious media outlets prefer to control their content and ads on digital platforms.

Partners have asked for a while for the ability to sell their own media on Facebook. The social network has allowed them to sell brand integrations directly in videos, but otherwise has handled ad sales itself and split the revenue.

The rep declined to comment on the revenue split beyond saying it "would be competitive to other platforms."

Facebook has already announced a number of new initiatives to drive more viewers to Watch shows as well as a test of ads before programs start.

This is the dilemma: Facebook lured publishers to make and post shows to the Watch section. But issues like difficulty getting exposure in the hub have made the News Feed the easiest way to find viewers.

And that matters because the News Feed doesn't encourage the viewing habits that Facebook wants. One of the driving motivations for the video hub was to get people to turn on the volume, sit through entire shows, stick around even during ad breaks and perhaps watch something else after that. Ads on video in the hub seem to command a higher price too, twice as much as the same ads in News Feed, according to one digital video ad buyer.

In the News Feed, viewers are doing drive-bys, usually without sound, and can quickly scroll away if a commercial starts. They're also less likely to get addicted to a series. Don't even think about binge-watching.

Facebook last week acknowledged the challenges with updates in the way it promotes shows—in the feed and the hub. "We will show more videos in News Feed that people seek out or return to watch from the same publisher or creator week after week," Facebook's product team said in a post. Watch's "Discover" tab will also prioritize "shows that people come back to," the post said.

In other words: Anyone who can hook viewers will reap the rewards.

"The plans they approached partners with when they pitched the video tab and the deals for Watch programming, none of that applies today," says an executive at another publishing partner, one that has gone through two rounds of negotiations with Facebook to develop Watch programs. "It's all thrown out."

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