Facebook suddenly declared an interest in outright owning shows produced for its Watch platforms, Digiday reported Wednesday, citing several sources familiar with the matter. The "spotlight deal" previously associated with the platform isn't part of the offer as the Menlo Park, California-based tech giant is said to have unexpectedly changed its terms during its negotiations with potential Watch publishers, insiders claim, adding that the main deal now offered to content creators is significantly stricter than the one publicized in early August.
In essence, Facebook's suddenly revised terms would limit the revenue potential for publishers in most cases, with the move itself prompting many to reconsider its plans to collaborate with the world's largest social media platform in its attempt to take on YouTube. The offer is said to exclude short "spotlight" shows Facebook has previously been financing and (only occasionally) purchasing as the company is reportedly moving away from that format and has instead set its sights on longer programming more reminiscent of traditional TV shows. The social media giant is internally referring to such content as "hero" shows, with that moniker being attached to programming it purchases for a one-time fee, sources reveal.
Such shows are meant to be no shorter than 15 minutes per episode and have bigger budgets than spotlights but are also intended to be owned by Facebook, leaving actual producers with between 10 to 15 percent of the usual margin attached to similar content in the industry, provided that the project doesn't end up being a complete flop. Not all publishers negotiating with Facebook are discouraged by the sudden change of direction that was communicated to them earlier this month, with some seeing the move as an opportunity for creating another revenue stream that isn't based on ads, which is a rarity in the media industry. The sustainability of such a business model remains dubious, with Facebook presumably looking to use "hero" shows to boost the popularity of its YouTube rival before letting the platform mostly grow on its own with user-submitted content. Facebook's new approach to digital publishing appears to resemble that of Netflix and Amazon, though the company still isn't interested in financing features and programming with Hollywood-like production values, sources claim.