Facebook shareholders have everything to be cheerful about the new Facebook video ads. Stanley Morgan says Facebook might start getting $1 billion in 2014 alone, and they are yet to roll out! However unhappy the Facebook users might be of having advertisements inserted in their news feed!
This amount if 1% of all television advertisements spending in the USA. By 2020, the company is expected to earn $6.5 billion, according to Morgan Stanley.
Analysts Scott Devitt, Jordan Monahan and John Egbert has composed this report basing on sources like Bloomberg, the financial times and others. In accordance with other Facebook users, experts and reviewers, the researchers also confirm that the Facebook video ads will be rolled out later this year. They further predicted that the feature is to remain exclusive to USA till most of 2014.
Europe should come under it by late 2014 while Asia and rest of the world to get it by 2015 and 2016 respectively.
The company will not force the video on the users however as there will be options to scroll past it. The ads will open with sound muted as default option and when the sound is turned on, the ad will replay from the beginning. The length is predicted to be of 15 seconds. The cost, however, is maintained low and the advertising companies will need to pay $20 or so on CPM basis.
Facebook Advertising has shown incredible growth in recent years in the ad revenues. In Q2, 2013 Facebook reported a $1.6 billion as total revenue, up from $1 billion of Q2, 2012. That is a 60% increment. Facebook shares has also climbed a lot and a 45% growth has been reported since the Q2 score sheet was out.
Facebook is not alone in this race to win the video ad revenue incurring. Popular video sharing site, YouTube, is expected to win $4 billion from the ads they display. This figure is to reach $20 billion in 2020 which is three times of that of Facebook in 2020. It would also be 17% of total TV advertisement spending in the USA in that year.