Is Facebook Squaring Off with TV Networks for Ads?

by Dan Holden | December 20, 2012

Samsung tv

Facebook may be preparing to compete directly with TV networks and cable companies for advertising dollars. Citing “several industry executives,” Ad Age said today that the social media leader is planning to unveil a new video-ad product in the first half of next year, allowing advertisers to deliver high-quality video advertising directly into users’ news feeds.

Unnamed sources said the move to bring video ads into the news stream is the most direct play for Madison Avenue ad dollars since Facebook’s IPO.  The company is reportedly still working with ad industry pros to tweak the final product, which they said could be ready in the first or early second quarter of 2013.

Ad Age said the product will support news feeds for desktop, smart phone and tablet environments. Facebook also appears to be pushing for short segments – fifteen seconds, rather than the 30-second spots normally seen on TV. Significantly, the architecture calls for “autoplay” ads, meaning they will activate automatically as the user brings them into view.

The revelation follows news last week that traditional print news publication The Washington Post and its affiliated network of publications would be taking their social reader apps off of Facebook, instead redirecting users to a separate site called socialreader.com. The publications has used Facebook’s Open Graph technology to build their readership and acquire valuable information about reader interests, but after several rounds of adjustments to Facebook’s News Feed, much of that traffic has been lost, said insiders. The Guardian had reached a similar conclusion a week earlier.

The two developments may be connected in that a migration from Facebook by traditional print publications would leave a serious hole for Madison Avenue advertisers, unless the social network can recapture interest by drawing advertisements from another medium – specifically, television and cable producers.

Facebook missed a huge opportunity to run video ads during the political season, when millions of dollars of advertising was targeted at highly specific demographic groups during the most expensive presidential election ever. Facebook’s powerful Open Graph could have contributed immensely to the campaigns.

Another major impetus for the new development may be the integration of data streaming between TV, set-top boxes, PCs and mobile devices, including laptops, tablets and smart phones. Newer routers and remote controls are able to manipulate WiFi and Bluetooth transmissions through an in-home router to synchronize delivery of video content through all of these devices. This technology could represent an opportunity or a challenge for Facebook moving forward.

Photo: Samsung

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