Instagram’s meteoric rise continues, dwarfing the stagnant growth rates of Snapchat and Facebook. Today Instagram announced that it has reached 1 billion monthly active users, after reaching 800 million in September 2017 with 500 million daily users.
That massive audience could be a powerful draw for IGTV, the longer-form video hub its launching for creators today. While IGTV monetization options are expected in the future, content makers may flock to it early just to get exposure and build their fan base.
While Snapchat’s daily user count grew just 2.13 percent in Q1 2018 to 191 million, and Facebook’s monthly count grew 3.14 percent to reach 2.196 billion, Instagram is growing closer to 5 percent per quarter.
Hitting the 1 billion user milestone could put more pressure on Instagram to carry its weight in the Facebook family and bring home more cash. Facebook doesn’t break out Instagram’s revenue and has never given any guidance about it. But eMarketer estimates that Instagram will generate $5.48 billion in US ad revenue in 2018, up 70 percent from last year. It reports that Instagram makes up 28.2 pecent of Facebook’s mobile ad revenue.
The Instagram brand increasingly looks like Facebook’s life raft. Sentiment towards Facebook, especially amongst teens, has been in decline, and its constantly rocked by privacy scandals. But many users don’t even realize Facebook owns Instagram, and still love the photo sharing app. With the 1 billion user badge, businesses and content creators may take the photo and video app even more seriously. Selling windows into your friends’ worlds is a lucrative business.
Instagram is ready to compete head on with YouTube. Today at a flashy event in San Francisco, the company announced it will begin allowing users to upload videos up to 1 hour in length, up from the previous 1 minute limit. And to house the new longer-form videos from star content creators, Instagram is launching IGTV. Accessible from a button atop the Instagram homescreen or a standalone app, IGTV will spotlight popular videos from Instagram celebrities.
IGTV will let anyone be a creator, not just big name celebrities. People will be able to upload vertical videos through Instagram’s app or the web. Everyone except smaller and new accounts will be able to upload hour-long videos immediately, with that option expanding to everyone eventually. The IGTV will be available globally on iOS and Android sometime today, as well as in th Instagram app. “We made it a dedicated app so you can tap on it andenjoy video without all the distraction” Systrom explained.
In IGTV’s dedicated app or its in-Instagram experience, viewers will be able to swipe through a variety of longer-form videos, or swipe up to visit a Browse tab of personally recommend videos, popular videos, creators they’re following, and the option to continue watching previously started videos. Users will also get callouts from the IGTV button alerting them to new content.
IGTV will also let creators develop Instagram Channels full of their different videos that people can subscribe to. Creators will be able to put links in the description of their videos to drive traffic elsewhere.
“There’s no ads in IGTV today” says Systrom, but he says it’s a “a very reasonable place for them to end up”. He explained that since creators are investing a lot of time into IGTV videos, he wants to make that sustainable by offering them a way to monetize in the future. Instagram isn’t paying any creators directly for IGTV videos either.
With 1 billion users on Instagram, IGTV could be popular with creators not only trying to earn money but grow their audience. Instagram is expected to build out a monetization option for IGTV creators, potentially including ad revenue shares. The big user base could also attract advertisers. eMarketer already expects Instagram to earn $5.48 billion in US ad revenue in 2018.
Instagram has evolved far beyond the initial simplicity of just filtering and sharing photos. When it launched, mobile networks, screens, and cameras weren’t ready for longer-form video, and neither were users. As more families cut the cord or teens ignore television all together, though, Instagram has an opportunity to become the TV of mobile. YouTube may always have a wider breadth of content. But through curation of creators and publishers’ video content, Instagram could become the reliable place to watch something great on the small screen.
Facebook is starting to let Group admins charge $4.99 to $29.99 per month for access to special sub-Groups full of exclusive posts. A hand-picked array of parenting, cooking, and ‘organize my home’ Groups will be the first to get the chance to spawn a subscription Group open to their members.
During the test, Facebook won’t be taking a cut, but since the feature bills through iOS and Android, they’ll get their 30 percent cut of a user’s first year of subscription and 15 percent after that. But if Facebook eventually did ask for a revenue share, it could finally start to monetize the Groups feature that’s grown to over 1 billion users.
The idea for subscription Groups originally came from the admins. “It’s not so much about making money as it is investing in their community” says Facebook Groups product manager Alex Deve. “The fact that there will be funds coming out of the activity helps them create higher quality content.” Some admins tell Facebook they actually want to funnel subscription dues back into activities their Group does together offline.
Content users might get in the exclusive version of groups include video tutorials, lists of tips, and support directly from admins themselves. For example, Sandra Mueller’s Declutter My Home Group is launching a $14.99 per month Organize My Home subscription Group that will teach members how to stay tidy with checklists and video guides. The Grown and Flown Parents group is spawning a College Admissions and Affordability subscription group with access to college counselors for $29.99. Cooking On A Budget: Recipes & Meal Planning will launch a $9.99 Meal Planning Central Premium subscription group with weekly meal plans, shopping lists for different grocery stores, and more.
But the point of the test is actually to figure out what admins would post and whether members find it valuable. “They have their own ideas. We want to see how that is going to evolve” says Deve.
Here’s how subscription Groups work. First, a user must be in a larger group where the admin has access to the subscription options and posts an invitation for members to check it out. They’ll see preview cards outlining what exclusive content they’ll get access to and how much it costs. If they want to join, the admin vets their application, and if they’re approved they’re charged the monthly fee right away.
They’ll be billed on that date each month, and if they cancel, they’ll still have access until the end of the month. That prevents anyone from joining a group and scraping all the content without paying the full price. The whole system is a bit similar to subscription patronage platform Patreon, but with a Group and its admin at the center instead of some star creator.
Back in 2016, Facebook briefly tested showing ads in Groups, but now says that was never rolled out. However, the company says that admins want other ways beyond subscriptions to build revenue from Groups and it’s considering the possibilities. Facebook didn’t have any more to share on this, but perhaps one day it will offer a revenue split from ads shown within groups.
Between subscriptions, ad revenue shares, tipping, sponsored content, and product placement — all of which Facebook is testing — creators are suddenly flush with monetization options. While we spent the last few decades of the consumer internet scarfing up free content, creativity can’t be a labor of love forever. Letting creators earn money could help them turn their passion into their profession and dedicate more time to making things people love.
TechCrunch has learned that the Instagram longer-form video hub that’s launching tomorrow is called IGTV and it will be part of the Explore tab, according to multiple sources. Instagram has spent the week meeting with online content creators to encourage them to prepare videos closer to 10-minute YouTube vlogs than the 1-minute maximum videos the app allows today.
Instagram is focusing its efforts around web celebrities that made their name on mobile rather than more traditional, old-school publishers and TV studios that might come off too polished and processed. The idea is to let these creators, who have a knack for this style of content and who already have sizeable Instagram audiences, set the norms for what IGTV is about.
Instagram declined to comment on the name IGTV and the video hub’s home in app’s Explore tab. We’ll get more information at the feature’s launch event in San Francisco tomorrow at 9am Pacific.
Following the WSJ’s initial report that Instagram was working on allowing longer videos, TechCrunch learned much more from sources about the company’s plan to build an aggregated destination for watching this content akin to Snapchat Discover. The videos will be full-screen, vertically oriented, and can have a resolution up to 4K. Users will be greeted with collection of Popular recent videos, and the option to Continue Watching clips they didn’t finish.
The videos aren’t meant to compete with Netflix Originals or HBO-quality content. Instead, they’ll be the kind of things you might see on YouTube rather than the short, off-the-cuff social media clips Instagram has hosted to date. Videos will offer a link-out option so creators can drive traffic to their other social presences, websites, or ecommerce stores. Instagram is planning to offer direct monetization, potentially including advertising revenue shares, but hasn’t finalized how that will work.
Based on its historic growth trajectory that has seen Instagram adding 100 million users every four months, and its announcement of 800 million in September 2017, it’s quite possible that Instagram will announce it’s hit 1 billion monthly users tomorrow. That could legitimize IGTV as a place creators want to be for exposure, not just monetization.
IGTV could create a new behavior pattern for users who are bored of their friends’ content, or looking for something to watch in between Direct messages. If successful, Instagram might even consider breaking out IGTV into its own mobile app, or building it an app for smart TVs
The launch is important for Facebook because it lacks a popular video destination since its Facebook Watch hub was somewhat of a flop. Facebook today said it would expand Watch to more creators, while also offering new interactive video tools to let them make their own HQ trivia-style game shows. Facebook also launched its Brand Collabs Manager that helps businesses find creators to sponsor. That could help IGTV stars earn money through product placement or sponsored content.
Until now, video consumption in the Facebook family of apps has been largely serendipitous, with users stumbling across clips in their News Feed. IGTV will let it more directly compete with YouTube, where people purposefully come to watch specific videos from their favorite creators. But YouTube was still built in the web era with a focus on horizontal video that’s awkward to watch on iPhones or Androids.
With traditional television viewership slipping, Facebook’s size and advertiser connections could let it muscle into the lucrative space. But rather than try to port old-school TV shows to phones, IGTV could let creators invent a new vision for television on mobile.
Facebook wants to help connect brands to creators so they can work out sponsored content and product placement deals, even if it won’t be taking a cut. Confirming our scoop from May, Facebook today launched its Brand Collabs Manager. It’s a search engine that brands can use to browse different web celebrities based on the demographics of their audience and porfolios of their past sponsored content.
Creators hoping to score sponsorship deals will be able to compile a portfolio connected to their Facebook Page that shows off how they can seamlessly work brands into their content. Brands will also be able to find them based on the Top countries where they’re popular, and audience characteristics like interests, gender, education, relationship status, life events, or home ownership.
Facebook also made a wide range of other creator monetization announcements today
Facebook’s Creator app that launched on iOS in November rolled out globally on Android today. The Creator app lets content makers add intros and outros to Live broadcasts, cross-post content to Twitter and Instagram, see a unified inbox of their Facebook and Instagram comments plus Messenger chats, and more ways to connect with fans.
Ad Breaks, or mid-video commercials, are rolling out to more US creators, starting with those that make longer and original content with loyal fans. Creators keep 55 percent of the ad revenue from the ads.
Patreon-Style Subscriptions are rolling out to more creators, letting them charge fans $4.99 per month for access to exclusive behind the scenes content plus a badge that highlights that they’re a patron. Facebook also offers microtransaction tipping of video creators through its new virtual currency called Stars.
Top Fan Badges that highlight a creator’s most engaged fans will now roll out more broadly after a strong initial reaction to tests in March.
Rights Manager, which lets content owners upload their videos so Facebook can fingerprint them and block others from uploading them, is now available for creators not just publishers.
Facebook also made a big announcement today about the launch of interactive video features and its first set of gameshows built with them. Creators can add quizzes, polls, gamification, and more to their videos so users can play along instead of passively viewing. Facebook’s Watch hub for original content is also expanding to a wider range of show formats and creators.
Facebook needs the hottest new content from creators if it wants to prevent users’ attention from slipping to YouTube, Netflix, Twitch, and elsewhere. But to keep creators loyal, it has to make sure they’re earning money off its platform. The problem is, injecting Ad Breaks that don’t scare off viewers can be difficult, especially on shorter videos.
But Vine proved that six-seconds can be enough to convey a subtle marketing message. A startup called Niche rose to arrange deals between creators and brands who wanted a musician to make a song out of the windows and doors of their new Honda car, or a comedian to make a joke referencing Coca-Cola. Twitter eventually acquired Niche for a reported $50 million so it could earn money off Vine without having to insert traditional ads. [Disclosure: My cousin Darren Lachtman was a co-founder of Niche.]
Vine naturally attracted content makers in a way that Facebook has had some trouble with. YouTube’s sizable ad revenue shares, Patreon’s subscriptions, and Twitch’s fan tipping are pulling creators away from Facebook.
So rather than immediately try to monetize this sponsored content, Facebook is launching the Brand Collabs Manager to prove to creators that it can get them paid indirectly. Facebook already offered a way for creators to tag their content with disclosure tags about brands they were working with. But now it’s going out of its way to facilitate the deals. Fan subscriptions and tipping come from the same motive: letting creators monetize through their audience rather than the platform itself.
Spinning up these initiatives to be more than third-rate knockoffs of Niche, YouTube, Patreon, and Twitch will take some work. But hey, it’s cheaper for Facebook than paying these viral stars out of pocket.
Rather than build its own HQ trivia competitor, Facebook is launching a gameshow platform. Today the company announced a new set of interactive live and on-demand video features that let creators adds quizzes, polls, challenges, and gamification so players can be eliminated from a game for a wrong answer. The features could help Facebook achieve its new mission to push healthier active video consumption rather than passive zombie watching that hurts people’s well-being. Creators and publishers who want early access can sign up here.
Gameshow launch partners include Fresno’s What’s In The Box where viewers guess what’s inside, and BuzzFeed News’ Outside Your Bubble where contestants have to guess what their opponents are thinking. Plus, Facebook is testing the ability to award prize money with (Business) INSIDER’s Confetti, where viewers answer trivia questions and can see friends’ responses, with winners splitting the cash.
“Video is evolving away from just passive consumption to more interactive two-way formats”, Simo tells TechCrunch. “We think creators will want to reward people. If this is something that works will with Insider and Confetti, we may consider rolling out payments tools.”
When asked if Facebook was inspired by HQ, Simo repeatedly dodged the question and avoiding mentioning the startup’s name, but relented in saying “I think they’re part of a much broader trend that is making content interactive. We’ve seen that across much more than one player.”
Facebook won’t be taking a share of the prize money in this test. For now, it’s also forgoing its cut of its $4.99 per month subscriptions option that lets fans pay for exclusive content, which rolls out today to more creators. Facebook also just launched its Brand Collabs Manager that we scooped in May, which helps brands browse creators by demographic and portfolio so they can set up sponsored content and product placement deals.
The new interactive video features will be available to all publishers and creators, alongside the global launch of the Android version of Facebook’s Creator app for web celebs. The tools range from offering basic in-video polls to creating a full trivia gameshow. Creators and will be able to write out their trivia questions and designate correct answers, as well as “write down the logic of the game” says Simo.
While polls will work for Live and on-demand videos, gamification that impacts the outcome of the broadcast is only for Live. Brent Rivera and That Chick Angel are two creators who will be testing the features in the coming weeks. Facebook already found that fans enjoyed polling on its Watch show Help Us Get Married, which let viewers influence the wedding planning decisions about themes and the venue.
Facebook’s last attempt at original video, its Watch hub, saw mediocre adoption as the content felt also-ran rather than something special or must-see. That’s why Facebook is expanding Watch to offer a broader range of shows for more creators, including potentially longer or non-episodic content. That includes bringing Facebook videos originally only hosted on Pages into the Watch destination.
What we’re seeing here is positioning that diverges Facebook and Instagram’s video efforts. Facebook’s might be more interactive, about playing and watching with friends, and embrace more novel new formats like mobile gameshows. Instagram, with its history of polished photos, could house more traditional high-end entertainment content.
“We’re not trying to do one show or one trivia game. We’re trying to get every creator to create such gameplay. The beauty of the creators space is that they each have a unique audience” Facebook’s VP of video product Fidji Simo tells me. With 2.2 billion users, making an in-house one-size-fits-all game may have been impossible.
Pick a category, wager a few dollars and double your money in 60 seconds if you’re smarter and faster than your opponent. Proveit offers a fresh take on trivia and game show apps by letting you win or lose cash on quick 10-question, multiple choice quizzes. Sick of waiting to battle a million people on HQ for a chance at a fraction of the jackpot? Play one-on-one anytime you want or enter into scheduled tournaments with $1,000 or more in prize money, while Proveit takes around 10 percent to 15 percent of the stakes.
“I’d play Jeopardy all the time with my family and wondered ‘why can’t I do this for money?’ ” says co-founder Prem Thomas.
Remarkably, it’s all legal. The Proveit team spent two years getting approved as “skill-based gaming” that exempts it from some laws that have hindered fantasy sports betting apps. And for those at risk of addiction, Proveit offers players and their loved ones a way to cut them off.
The scrappy Florida-based startup has raised $2.3 million so far. With fun games and a snackable format, Proveit lets you enjoy the thrill of betting at a moment’s notice. That could make it a favorite amongst players and investors in a world of mobile games without consequences.
“I could spend $50 for a three-hour experience in a movie theater, or I could spend $2 to enter a Proveit Movies tournament that gives me the opportunity to compete for several thousand dollars in prize money,” says co-founder Nathan Lehoux. “That could pay for a lot of movies tickets!”
Proving it as outsiders
St. Petersburg, Fla. isn’t exactly known as an innovation hub. But outside Tampa Bay, far from the distractions, copycatting and astronomical rent of Silicon Valley, the founders of Proveit built something different. “What if people could play trivia for money just like fantasy sports?” Thomas asked his friend Lehoux.
That’s the same pitch that got me interested when Lehoux tracked me down at TechCrunch’s SXSW party earlier this year. Lehoux is a jolly, outgoing fella who became interested in startups while managing some angel investments for a family office. Thomas had worked in banking and health before starting a yoga-inspired sandals brand. Neither had computer science backgrounds, and they’d raised just a $300,000 seed round from childhood friend Hilt Tatum who’d co-founded beleaguered real money gambling site Absolute Poker.
Yet when he Lehoux thrust the Proveit app into my hand, even on a clogged mobile network at SXSW, it ran smoothly and I immediately felt the adrenaline rush of matching wits for money. They’d initially outsourced development to an NYC firm that burned much of their initial $300,000 seed funding without delivering. Luckily, the Ukrainian they’d hired to help review that shop’s code helped them spin up a whole team there that built an impressive v1 of Proveit.
Meanwhile, the founders worked with a gaming lawyer to secure approvals in 33 states including California, New York, and Texas. “This is a highly regulated and highly controversial space due to all the negative press that fantasy sports drummed up,” says Lehoux. “We talked to 100 banks and processors before finding one who’d work with us.”
Proveit founders (from left): Nathan Lehoux, Prem Thomas
Proveit was finally legal for the three-fourths of the U.S. population, and had a regulatory moat to deter competitors. To raise launch capital, the duo tapped their Florida connections to find John Morgan, a high-profile lawyer and medical marijuana advocate, who footed a $2 million angel round. A team of grad students in Tampa Bay was assembled to concoct the trivia questions, while a third-party AI company assists with weeding out fraud.
Proveit launched early this year, but beyond a SXSW promotion, it has stayed under the radar as it tinkers with tournaments and retention tactics. The app has now reached 80,000 registered users, 6,000 multi-deposit hardcore loyalists and has paid out $750,000 total. But watching HQ trivia climb to more than 1 million players per game has proven a bigger market for Proveit.
Quiz for cash
“We’re actually fans of HQ. We play. We think they’ve revolutionized the game show,” Lehoux tells me. “What we want to do is provide something very different. With HQ, you can’t pick your category. You can’t pick the time you want to play. We want to offer a much more customized experience.”
To play Proveit, you download its iOS-only app and fund your account with a buy-in of $20 to $100, earning more bonus cash with bigger packages (no minors allowed). Then you play a practice round to get the hang of it — something HQ sorely lacks. Once you’re ready, you pick from a list of game categories, each with a fixed wager of about $1 to $5 to play (choose your own bet is in the works). You can test your knowledge of superheroes, the ’90s, quotes, current events, rock ‘n roll, Seinfeld, tech and a rotating selection of other topics.
In each Proveit game you get 10 questions, 1 at a time, with up to 15 seconds to answer each. Most games are head-to-head, with options to be matched with a stranger, or a friend via phone contacts. You score more for quick answers, discouraging cheating via Google, and get penalized for errors. At the end, your score is tallied up and compared to your opponent, with the winner keeping both player’s wagers minus Proveit’s cut. In a minute or so, you could lose $3 or win $5.28. Afterwards you can demand a rematch, go double-or-nothing, head back to the category list or cash out if you have more than $20.
The speed element creates intense, white-knuckled urgency. You can get every question right and still lose if your opponent is faster. So instead of second-guessing until locking in your choice just before the buzzer like on HQ, where one error knocks you out, you race to convert your instincts into answers on Proveit. The near instant gratification of a win or humiliation of a defeat nudge you to play again rather than having to wait for tomorrow’s game.
Proveit will have to compete with free apps like Trivia Crack, prize games like student loan repayer Givling and virtual currency-based Fleetwit, and the juggernaut HQ.
“The large tournaments are the big draw,” Lehoux believes. Instead of playing one-on-one, you can register and ante up for a scheduled tournament where you compete in a single round against hundreds of players for a grand prize. Right now, the players with the top 20 percent of scores win at least their entry fee back or more, with a few geniuses collecting the cash of the rest of the losers.
Just like how DraftKings and FanDuel built their user base with big jackpot tournaments, Proveit hopes to do the same… then get people playing little one-on-one games in-between as they wait for their coffee or commute home from work.
Gaming or gambling?
Thankfully, Proveit understands just how addictive it can be. The startup offers a “self-exclusion” option. “If you feel that you need to take greater control of your life as it relates to skill-gaming,” users can email it to say they shouldn’t play any more, and it will freeze or close their account. Family members and others can also request you be frozen if you share a bank account, they’re your dependant, they’re obligated for your debts or you owe unpaid child support.
“We want Proveit to be a fun, intelligent entertainment option for our players. It’s impossible for us to know who might have an issue with real-money gaming,” Lehoux tells me. “Every responsible real-money game provides this type of option for its users.
That isn’t necessarily enough to thwart addiction, because dopamine can turn people into dopes. Just because the outcome is determined by your answers rather than someone else’s touchdown pass doesn’t change that.
Skill-based betting from home could be much more ripe for abuse than having to drag yourself to a casino, while giving people an excuse that they’re not gambling on chance. Zynga’s titles like Farmville have been turning people into micro-transaction zombies for a decade, and you can’t even win money from them. Simultaneously, sharks could study up on a category and let Proveit’s random matching deliver them willing rookies to strip cash from all day. “This is actually one of the few forms of entertainment that rewards players financially for using their brain,” Lehoux defends.
With so much content to consume and consequence-free games to play, there’s an edgy appeal to the danger of Proveit and apps like it. Its moral stance hinges on how much autonomy you think adults should be afforded. From Coca-Cola to Harley-Davidson to Caesar’s Palace, society has allowed businesses to profit off questionably safe products that some enjoy.
For better and worse, Proveit is one of the most exciting mobile games I’ve ever played.