WSJ: Facebook building video app for Apple TV and other set-top boxes as it ramps up its original programming efforts
Facebook is developing an app for set-top boxes including Apple TV, as a way to bring longer-form video content — and video ads — to big-screen TVs in consumers' living rooms, the Wall Street Journal reported.
Context & Ripple Effects
Facebook's move onto the television is the third step of a deliberate sequence. In late 2015 it shipped a tvOS SDK letting developers add Facebook login, sharing, and analytics to Apple TV apps, and in November 2016 it began testing TV-style ads delivered through its ad network to apps on devices like Apple TV and Roku. A dedicated video app closes the loop: Facebook gets its own surface on the big screen rather than renting space inside others' apps.
First-order effects
- Longer-form video and video ads gain a living-room distribution channel, giving Facebook first-party inventory for the TV-ad tests it started running via its ad network in November 2016.
- Apple TV and rival set-top boxes add a high-traffic social-video app at no content cost, strengthening their value proposition against cable boxes in the same living rooms.
Second-order effects
- Advertisers can now extend Facebook's targeting from phones to the TV screen, putting direct pricing pressure on traditional TV ad sales that have never had per-user targeting.
- Content owners and talent whose long-form video currently flows to YouTube and broadcasters face a second deep-pocketed bidder, a dynamic that foreshadows the [[a:920080|TV-quality shows with budgets up to $3M per episode Facebook was later reported courting agencies for]].
Third-order effects
- If the pattern holds, the boundary between social feeds and broadcast television dissolves: whoever owns user-level ad targeting plus content distribution consolidates the living room, forcing legacy TV to compete on data rather than reach.
The trend: Social platforms are porting their mobile advertising machines onto connected TVs, using apps and original programming to turn the living room into their next ad market.