Metaverse can’t save meta, can “block tiktok”?

Now it seems that meta doesn’t hesitate to abandon its old name to bind metaverse to itself, which is more like “talking about him around”.

At the beginning of February, meta (formerly Facebook) announced the fourth quarter financial report of 2021. Due to the performance not in line with expectations, meta’s share price plunged 26% at the close of the day, the largest one-day decline in 10 years since it was listed.

“Speech” is to face the strong posture of metaverse and avoid the social face that once shaped the company but is now full of fatigue. There is no metaverse in the financial report. Meta’s weakness cannot be concealed, and even vaguely reminds people of the decline of Yahoo more than a decade ago.

Or tiktok.

In recent years, tiktok’s rapid pace in downloads and user activity has put a thorn in the back of Facebook. Zuckerberg has no choice but to admit that tiktok’s increasing competitive pressure on Facebook is one of the reasons why the financial report is less than expected. Half a month after the financial report, meta decided to open the short video function reels to all Facebook users around the world. Zuckerberg hopes to beat tiktok with another tiktok.

A6021 source: meta official website

Sexy vision, skinny stock price

On February 7, meta (FB. US) released the fourth quarter financial report of fiscal year 2021. Let’s take a look at the “collapse” of the first financial report renamed meta by Facebook.

According to the financial report, the revenue of meta in the fourth quarter of last year was $33.67 billion, slightly higher than the $33.4 billion expected by analysts. However, the 20% year-on-year increase in revenue was significantly lower than the 47.6%, 55.6% and 35% increase in the first three quarters of fiscal 2021.

At the level of net profit, meta failed to hold the rise and fell for the first time since the second quarter of 2019. In the fourth quarter, its net profit was US $10.29 billion, a year-on-year decrease of 8%. EPS per share was $3.67, down 5% year-on-year, well below the 2% expected by the market.

Meta2021q4 financial report

Shrouded in the shadow of meta’s revenue outlook is that users are leaving Facebook.

From the third quarter to the fourth quarter, the number of daily active users of meta’s social matrix (including Facebook, instagram, WhatsApp, Messenger and other services) was 2.82 billion, an increase of 8% over the same period last year. In the overall rise, the distribution of active users in various products has not changed substantially. Nearly 2 billion daily active users still come from Facebook. Therefore, The sudden decline in the performance of Facebook users has become the focus of concern.

In addition, the change of IOS privacy policy is another dark cloud over meta’s head.

Last April, ios14 5. The new privacy regulations of the system release, including the app tracking transparency, will be implemented with this version update. After the implementation of the new regulations, users will receive the query of “whether to allow app to read user data” when opening the application for the first time, which means that technology companies that previously relied on user data information to push personalized advertisements will not be able to accurately feed advertisements to users, which will have a great impact on the advertising business in which meta accounts for more than 90% of the total revenue.

Cheryl, chief operating officer of Facebook, said in the financial report that the tightening of IOS privacy policy “means that the accuracy of our advertising positioning users has decreased, the cost of getting customers has increased, and it has become more difficult to measure the advertising effect, which has led to the decline of meta’s appeal to advertisers”.

图源:Appleinsider source: Appleinsider

As global users pay more and more attention to the security of private data, the potential decline of meta advertising revenue prospect is difficult to reverse. In this changing year, Zuckerberg opened the curtain of the transformation of meta to metaverse. However, according to the first data disclosure of meta to metaverse department, this new business is still in the starting stage of increasing investment, continuing the trend of loss month on month expansion for four consecutive quarters, which is still far from starting the beam.

Metaverse makes meta maintain the image of a cutting-edge and sexy technology company, but the capital market does not pay for this vision. The evaporation of $200 billion means that social networking is still the basic market of meta.

In the face of skinny stock prices, meta needs to face its social difficulties after all. Zuckerberg admitted at the earnings meeting that the ferocity of tiktok was one of the reasons for the decline of share price.

Meta will put its hopes on reels for the way to recover the decline.

Tiktok and reels, Xishi and Dongshi

Reels, which was launched on instagram as early as August 2020, is nothing new.

When the user enters the instagram stories page, a parallel entry of “reels” will appear. Reels allows the user to shoot or upload video materials for 3-15 seconds, and provides the insertion effect of background music, filters and various graphic elements in the editing process. In terms of presentation effect, the video is browsed by sliding up and down. The title and text parts of the video are placed at the bottom of the screen, and the “like”, “comment” and “share” buttons are placed vertically on the right.

图源:Entrepreneur source: Entrepreneur

It’s very much like a replica of tiktok.

Copy the core play method, and then use the huge user basic disk to catch up from behind and reverse the user’s mind. This is Zuckerberg’s consistent trick to consolidate his social territory. Instagram stories itself is a plagiarized product of snapchat stories, and meta also uses this to curb snapchat. From this point, the meta that transformed metaverse still retains its own tradition.

In fact, this is not the first time meta has tried to beat tiktok by plagiarism.

After the unveiling of meta’s new logo, which is similar to “infinity”, many people feel that this logo is deja vu. If you try to rotate meta’s icon by 100 degrees counterclockwise and change the background color, you will find that it is very similar to lasso, another social product launched by meta in the Facebook era.

——A more powerful but closed tiktok clone product completely independent of the current meta social products.

In June 2018, Facebook added lip sync live to its existing live broadcast function. Five months later, lip sync live was separated from Facebook and became a short video social product called lasso. Like tiktok, Lasso is led by the recommendation algorithm, which allows users to shoot videos lasting 15 seconds and provides an optional music library. This is considered to be an attempt by meta to face tiktok after Facebook was gradually abandoned by young people.

图源:That source: that' s

After lasso’s release, meta has been draining the former through Facebook and instagram. The U.S. region became the first region to launch Lasso, and has successively entered Colombia, Mexico and other markets since then. However, the product that Zuckerberg placed high hopes on did not turn up. According to the data of sensor tower, the total downloads of lasso since its launch have been only 300000 times.

The failure of this product seems to have been doomed in the chaos at the beginning. Brady Voss, the team leader, left the team four days after the product was launched and switched to Netflix. Lasso, which added Hindi to the language, hastily announced its shutdown two years after it was launched.

Reels’ status soared, and meta made heavy bets

At the one hour earnings meeting, reels was mentioned 40 times by executives and analysts, equivalent to once every 1.5mins. For comparison, metaverse (metaverse) has only been mentioned 15 times.

Meta raised reels to an unprecedented priority, and this status improvement is traceable.

At first, reels, as an in app function, has been embedded in instagram, which can still be regarded as a reserved experimental attempt to some extent. After all, the most concentrated user group of meta is not in instagram, but with Facebook and instagram, the proportion of browsing video content in the user time has gradually increased, Reels is playing an increasingly important role.

Meta announced last quarter that its internal focus is further shifting to young people. Zuckerberg also said that “meta expects instagram and Facebook to further tilt towards video in the future, and reels will become a more core part of the experience”. By this quarter, video content accounted for more than half of users’ time on Facebook and instagram. Zuckerberg said at the financial report meeting that reels is the fastest-growing content form of meta at present, and has been the largest contributor to the growth of instagram participation.

It is expected that meta will open reels to all Facebook users around the world at this time. The inclination of resources provided by meta in cooperation with the opening of reels can also clearly feel the determination of this re injection.

First, the video duration of Facebook reels has been extended to 60 seconds and will be open to Facebook users in more than 150 countries in the future. In addition, in order to stimulate more content creators to come in, the launch of Facebook reels is accompanied by a very tempting incentive mechanism.

Facebook reels is determined to be included in the previous $1 billion incentive plan of meta for Facebook and instagram. This time, meta has introduced a monthly incentive mechanism of up to $35000 for Facebook reels to reward high-quality content creators on reels, and the bonus is linked to the viewing times of works on reels.

图源:Meta官网 source: meta official website

Meta also optimized the advertising sharing mechanism for Facebook reels. Facebook reels will try to introduce two new forms of advertising. Banner advertising will appear at the bottom of reels’ page in translucent form; Another kind of static picture advertisement can be placed anywhere in the picture at the discretion of the content creator. Through a more flexible advertising mechanism, reels will provide more revenue potential for content creators in the ecosystem.

In addition, Facebook reels content creators in the United States, Canada and Mexico will automatically join meta’s existing plug-in advertising sharing plan, and creators in more regions will be included in the plan in mid March. Another “Star” reward program will also be tested on Facebook reels in the next few weeks. Viewers can buy stars while watching short videos and transfer them to video authors. These received stars will be converted into reward income for content creators.

In November last year, instagram launched an incentive program for the creators of reels content, “reels assurance”. Instagram will reward 150 American creators up to $10000 a week to encourage their production " Inspiring and interesting " Short video;

Adam moseri, the person in charge of instagram, has also publicly said that the platform will “double its investment” in the video field in the future and focus on reels in 2022.

A series of momentum building plans since last year have paved the way for reels to log on to Facebook. Considering the continuous impact of the new IOS privacy policy on meta’s revenue growth, meta not only needs to retain users with reels, but also needs to reflect its ability and determination in the field of short video, so as to seize the share of short video advertising and retain advertisers.

The market is still on the sidelines

But whether the bet will work on reels remains to be seen.

Meta’s focus shifted from reels to lasso and then back to reels, which seems to be following a repeated path. Both play very similar to tiktok from to, and previous failed attempts have proved that Facebook’s boost is not enough to be the decisive chip for reels to bring down tiktok.

The capital market did not respond positively to meta’s social actions.

On February 22, meta said that it would open reels to all Facebook users around the world in the future. The news did not boost market confidence. On the same day, meta’s share price continued to fall by 2%.

Source: cnBeta

In fact, the encirclement and suppression faced by tiktok in the world is far beyond the meta family. YouTube said at the second quarter earnings conference last year that its embedded short video module, shorts, has been viewed more than 15 billion times a day around the world; Snapchat also launched a short video product spotlight with a material duration of up to 60 seconds at the end of 2020. Within two months after its launch, the monthly live users of the latter have exceeded 100 million.

These new opponents in the field of short video can’t threaten tiktok at present, but they are the enemy that reels has to face.

It’s embarrassing that meta, which lost its first chance in several confrontations, has no better way to deal with it at this time, except to continue to tap the potential of Facebook and instagram. The continued decline in share prices has put Zuckerberg’s advocacy of reels into a dilemma.

The outside world is waiting for meta’s next answer, which will determine whether “trust reels” is a deliberate choice or just a helpless way.

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