Mark Zuckerberg may not be running for president—not yet, at least—but his current plan for world domination is no less ambitious, or terrifying. Facebook’s ultimate goal, he explained earlier this year, was to make the social network an all-encompassing entertainment ecosystem, which nobody needs to leave to watch Netflix or YouTube. If people “want to watch videos or want to keep up to date with what’s going on with their favorite show, or what’s going on with a public figure that they want to follow . . . they can come to Facebook and go to a place knowing that that’s going to show them all the content that they’re interested in,” he told investors on a conference call. “The experience is designed to deliver on that promise— [that] you want to watch videos, you want to keep up with the content that you watch episodically week over week. This is going to be the place where you go to do that.”
If Hollywood wasn’t already frightened about getting its lunch eaten by Amazon, Netflix, and Hulu, it should be worried now. On Monday, The Wall Street Journal reported that Zuckerberg, after a few false starts, is finally diving headfirst into the streaming video business as he seeks to tap into the multi-billion dollar premium video advertising market. To lure partners, Facebook is reportedly telling studios and agencies that it is willing to commit as much as $3 million per episode in its push to develop original, television-quality shows that would debut on the social network.
As Amazon proved with Transparent, it only takes one critically acclaimed show to gain credibility as an original video producer, or one breakout hit—like Hulu’s The Handmaid’s Tale—to build momentum. And it’s easy to take risks and throw around money when you’ve got a market capitalization of nearly half a trillion dollars. Already, Facebook has plans for a millennial relationship drama called Strangers, and a game show called Last State Standing. The company appears to be targeting millennials, and it has been looking for shows like Freeform’s Pretty Little Liars, ABC’s Scandal, and The Bachelor, the Journal notes. “We’re supporting a small group of partners and creators as they experiment with the kinds of shows you can build a community around—from sports to comedy to reality to gaming,” Vice President of Media Partnerships Nick Grudin told the outlet. “We’re focused on episodic shows and helping all our partners understand what works across different verticals and topics.” The first slate of shows could begin debuting as early as this summer.
Facebook faces a slew of formidable rivals as it positions itself as a home for streaming content. Netflix, Amazon, YouTube’s Google Originals, and Apple all offer original streaming content, but Netflix and Amazon have a huge head start, with hundreds of original offerings and years of experience. Apple recently hired co-presidents of Sony Pictures Television Jamie Erlicht and Zack Van Amburg to lead its video efforts, and though it may have stumbled out of the gate with its original series Planet of the Apps, it also has “James Corden’s hit series “Carpool Karaoke” on deck. Facebook, however, appears to be taking a somewhat different path as it seeks to differentiate itself from its competitors. Instead of dropping an entire season at a time—a strategy deployed by streaming giants Amazon and Netflix—Facebook reportedly plans to take a more traditional route, releasing one episode at a time. It also plans to experiment with a variety of different kinds of series and formats, including shorter unscripted shows, longer scripted series alike, and picking up castoffs that have found success with niche audiences, just as Yahoo did when it produced a sixth season of cult-hit Community. Facebook is also differentiating itself by staying away from political dramas, shows with nudity or strong language, and shows that appeal to children and young teenagers.
Facebook appears to be offering favorable terms to Hollywood for now, promising to share viewership data and, presumably, rights. But if Facebook eventually wants to dominate the streaming space, the company will eventually want to own its content. This has been an ongoing battle between content creators and Facebook, and one only likely to be exacerbated by the new deals Facebook is inking. Facebook “will be aggressive about trying to own as much of that content as possible,” the Journal reports, which will put it at odds with Hollywood agents, who are unlikely to want to part with rights to television shows.
For Zuckerberg, making a play for video is ultimately one piece of a larger strategic vision: giving users a reason to log in to Facebook and to stay on the site. Twitter C.E.O. Jack Dorsey, who is also trying to stream more video, has had the same revelation. The traditional entertainment industry is in transition, under pressure to keep pace with a host of highly capitalized Silicon Valley upstarts even as cable subscriptions slump and viewers move online. Media, telecommunications, and technology are rapidly merging and consolidating in unprecedented ways. And legacy technology companies like Facebook, which offer an all-inclusive content experience, need to get in the game if they don’t want to lose out. Hollywood should take note.
