Facebook Inc (NASDAQ:FB) recently made some changes to Instagram. The company introduced Instagram video, which basically allows the average user to make short fifteen second clips.
What went wrong?
I think that Jenna Wortham from The New York Times made a strong point:
The introduction of video sharing on Instagram feels like the latest indicator of that disconnect. Video is imperfect. It’s a lot harder to craft a perfect video of your outdoor picnic, of waves crashing at the beach. It takes a lot more thought to turn the everyday quotidian into the spectacular, regardless of the dozen filters, editing effects and smoothing software that Instagram’s new video feature offers.
I want to add further that. It’s really difficult to be comfortable with who you are as a person on video versus camera. On camera, it’s a lot easier to take still frame shots that are perfected versions of who I am. But with video, that becomes a lot more difficult. Because of this, I believe that initial viewership data may indicate that the new video feature may have alienated pre-existing users, while taking away the appeal of using Vine.
Usage of Instagram video is tepid
On the first day of Instagram Video, there were approximately 5 million video uploads, according to The New York Times. Over the course of 30 days, we can basically estimate that 150 million videos will be uploaded.
So, 150 million videos sounds like a lot, but it really isn’t, especially when considering the fact that Instagram has 100 million monthly active users. This means that the average Instagram user will upload around 1.5 videos per month. So, based on preliminary user engagement figures, Instagram video may not be monetized anytime soon. Not until the average Instagram user becomes more accustomed to taking videos of themselves.
On the bright side, Instagram has been able to take away the amount of link-sharing of Vine videos when compared to Instagram. Now, users are more inclined to take care of all of their social needs with the use of Instagram rather than alternating in between Vine and Instagram. Vine is owned by Twitter, so this is going to be a bit of a blow for the competing social network.
If winning is about beating the competition, then Instagram has won. But, if Instagram was about keeping the users engaged, well, maybe the company fell a little short of that, as only a small handful of people are willing to put themselves out there using video.
How to position
Investors should consider investing in Google Inc (NASDAQ:GOOG) and Yahoo! Inc. (NASDAQ:YHOO).
Google has a bright future ahead of it. The company’s success in Android, YouTube, Google AdWords, Google Inc (NASDAQ:GOOG)AdSense, and Google Maps puts its well ahead of the competition. Some are even speculating on the company’s monopoly position through its acquisition of Waze. I’ll have more on that later!