Mercurial media

28 Jun 2017  |  Raymond Snoddy 
Mercurial media

Facebook wants to go to Hollywood, Twitter wants to be a newsbrand and Google is facing a fine of eye-watering sums. It's been an interesting week for social media, writes Ray Snoddy.

If a week is a long time in politics then a couple of days can be pretty dramatic in the life of three social media networks - or should that be two?

In an intriguing development Facebook has said, according to the Wall Street Journal, that it is preparing to spend up to £2.3 million for 30-minute episodes of online television series.

With 2 billion users around the world the odd £2.3 million may come into the peanuts category but is a significant indicator of intent – if Facebook actually does such a thing this summer as promised as opposed to merely talking about it as they have for ages.

The social media giant, which is hiring 3,000 people to try to weed out violent and inappropriate material from its output to protect its advertising revenues, says it is interested in everything from sports and comedy to entertainment and gaming.

It’s one of those wake-up moments that points to an accelerating trend as Facebook plans to join Netflix and Amazon in the prime online video market but with an advertiser-financed model.

Amazon in particular has already earned the traditional seal of success - no less than three Oscars for the movie Manchester by the Sea.

Of course such international content will not wipe out the audiences or the finances of national broadcasters anytime soon, or even at all, but over time they will keep nibbling away and intensify competition at the margins.

They have one obvious but powerful advantage. The costs of a production or acquisition of sports rights can be spread over a global advertising or subscriber base.

The content can be international, high-end entertainment such as House of Cards or local - Facebook is believed to be the favourite to win online rights for England and online cricket clips.

According to market research group eMarketer, adults in the UK will spend 53 minutes a day with digital video this year, twice as much as five years ago but still dwarfed by conventional television.

Advertising could still leak slowly away to Facebook to communities of interest assembled by, not just the £2.3 million episodes, but short-form efforts from the likes of Vox and BuzzFeed.

Not the end of the world but signs of the imminent arrival of yet another powerful player in the online video market which is further good news for independent content creators.

From the “peanuts” of the £2.3 million 30-minute episode to the eye-watering £2.15 billion fine imposed on Google by the European Union for allegedly exploiting its market dominance in search shopping.

The TV angle here of course is that the European Competition Commissioner, the Dane Margrethe Vestager, is said to have been the inspiration for the fictional Danish prime minster Birgitte Nyborg in the splendid TV series Borgen.

The investigation straddled seven years and 1.7 billion emails and found that Google had favoured its own shopping service at the expense of rivals.

Cue a huge row between Europe and the US and possible retaliation from President Trump.

Whatever happens, this is likely to be the first episode in a running series with more years to come of appeals and a litany of further cases waiting in the wings involving everything from travel, Google maps and images.

More billions of fines could be on the way on top of the $10 million a day that can be levied on the current case after a 90-day grace period to enable compliance.

Then there is the allegation that competitors providing online advertising are disadvantaged by Google websites and that the company ties phone manufacturers and network operators to its Android software system.

Google naturally argues “respectfully” that the European Union is wrong and denies everything but Margrethe Vestager does not appear to be the sort of lady who lets go once she had got her teeth into an issue.

One of the few things that Brexit secretary David Davis can be relieved about is that the Competition Commissioner is not the one in charge of the UK’s divorce settlement from Europe.

Once the dust has settled it is possible that a new more co-operative relationship could emerge between Google and the EU and between Google and its would be rivals.

Just as Facebook was setting out its video ambitions and Google was facing up to a record fine Twitter was saying some extraordinary things.

After about 10 years or so it had finally worked out what its core function is - or so it hopes - and can now concentrate on developing its brand and increasing its relatively slow rate of increasing the number of regular users.

The problem has been Joel Lunenfeld, Twitter’s global vice-president of brand strategy told Marketing Week at the Cannes Lions, that if you ask 100 people they’d tell you 100 different “use cases”.

Twitter has emerged from some deep thought to announce that it’s not just a social network. People do network on Twitter but it’s not the main reason people come to the sign of the little birds.

It’s a newsbrand rather than a social network and Twitter is now spending serious money on advertising with its first brand-level advertising in the US, a campaign that will be taken to the rest of the world including the UK.

The campaign has started with music but will move on to sport, entertainment and news.

Under the hashtag #SeeEverySide the aim is to emphasise that every side of what is happening is developed rather than the creation of echo-chambers and fake news.

Streaming partners range from a 24-hour news network and live online National Football League games to the launch of a new show WhatsHappening - a daily show built for Twitter.

Like the others Twitter too is going for live video and in the first quarter of this year streamed more than 800 hours of video content from partners across 450 events.

The challenge remains considerable. Despite the excitement of the US presidential election, Twitter increased its number of active users by only 4 per cent to 319 million.

But it will all probably be different next week.

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