Love Facebook? Have friends? Like to make videos?
The social network giant is banking on a large portion of its 890 million daily active users will answer yes, yes and yes.
This week, Facebook (FB) launched a new app that lets users make videos with friends. It's called Riff. Here’s how it works: You shoot a video of up to 20 seconds, give it a title, share it, and your friends can add on to it. It’s being called a hybrid of Snapchat and Vine.
It’s a new idea, sure, but does the world need another mobile video app?
Last week, Twitter (TWTR) launched its live streaming video app Periscope, to compete with the wildly popular livestreaming Meerkat app. Meerkat exploded on the scene earlier last month.
Facebook hasn’t always found success with new features and apps, says Yahoo Finance’s Henry Blodget. Think Slingshot, Paper, Rooms, and Groups. “Most of the ideas that they have put forth since their main idea of Facebook have come out with great fanfare and the flopped and then quietly been retired.”
But some ideas have been hits, like Messenger. And the acquisition of WhatsApp and Instagram have been huge boosts for the company. With Riff, Blodget says, “there is a huge opportunity there. And if you can get the right mix of something people like to do and suddenly you have hundreds of millions of young people using your app on their phone everyday communicating with friends. That’s very powerful.”
But is Facebook’s move with Riff a fresh idea or just keeping up with the social media Joneses? “This feels to me feels like an attempt to do something like what Snapchat is doing. It’s sort of a new idea—okay you take something that you’ve been sent and continue to modify. [But] who knows? Maybe it will catch on.”
Snapchat famously turned down a reported $3 billion acquisition offer from Facebook in late 2013. Now Snapchat is being valued at $15 billion.
There is big money in the video space. “Video is wonderful for advertising,” says Blodget. Snapchat is cashing in and Facebook wants to as well with Riff and or course Instragram.
From an investor’s standpoint, Blodget says the roll out of Riff is a good move. “Facebook is doing exactly the right thing. They are taking their cash flow and instead of maximizing quarterly earnings, they are actually investing in a lot of future growth some of which are these little lab projects which might catch on,” he says.
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