With the launch of the Miramax Facebook App that enables streaming rental of some of their titles, it brings up a number of fascinating elements to consider. As we see the rush on video distribution formats that enable consumers to consume however they want – whenever they want, Facebook adds a new dimension that could have future implications in more ways than just watching a movie here or there.
You can check out the limited details about the release here, but these are some of those things to keep an eye on as we move further into the experiment.
- Forget about second-screen application that utilize Facebook Connect to enable conversation during movies. This application has the ability, if done correctly, to have everything happen within the same interface.
- Not just related to this Miramax deal, by being web-based, they are able to leverage the cloud and truly make the anytime, anywhere (with a connection) more seamless than other digital video streaming options out there – with an already-huge user base. The user conversion expense should be mitigated to just internal communications. And, the incremental costs of streaming should also not be as hard of a hit that other video streaming sites feel due to Facebook’s already huge traffic threshold.
- A fantastic component that provides a “wait and see” mentality is the fact that they are promoting this as an iPad feature – but only within an optimized web-version that can be viewed via the Safari browser on the iPad. It is an ingenious way to get around the 30% revenue split with Apple. The wait and see part is that we don’t know whether the quality will be consistently good with streaming/connectivity concerns and the lack of an iOS-native interface. Additionally, we are seeing a bifurcation of quality tastes among users – some wanting great HD quality and some not really caring at all.
- Another look toward the future is in the handling of the payments for this product. The option of paying $3 or 30 Facebook credits enables consumers to use virtual currency for even more goods. A key factor of this is when it comes to profit participation. How do you share that profit when it is a FB credit that might have been accrued by the user for participating in other marketing functions – where there was never any monetary transaction? Another interesting aside to this is that a user could ostensibly “earn” the currency to pay for this by watching videos or trailers from other studios. Certainly an interesting dynamic.
- We know that Facebook does not let anything slide by them in terms of capturing information about consumer usage and tastes. An embedded video player adds depth to their knowledge base about each consumer – how much they watch, what they watch, when they watch, etc. For a company that wanted to shy away from advertising at its inception, they have become masters in pulling as much information as possible to enable them to target successfully and charge for it – privacy be damned.
Ultimately, there are a LOT of business complexities that need to be shaken out in the realm of online movies – both in viewing and distribution platforms. Facebook is uniquely positioned to be the bellweather for how consumers want to consume video online due to their penetration and technical prowess. Hopefully, we’ll all be able to learn from consumer reaction to any and all of the elements listed above and move forward.