Instagram Head Adam Mosseri Feels ‘Urgency’ for Reels to Work

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by Jacob Solomon Nov 6, 2022 News
Instagram Head Adam Mosseri Feels ‘Urgency’ for Reels to Work

As Meta Platforms Inc. pursues an expensive, unproven metaverse strategy, success will depend in part on whether Instagram can pay the bills.

Success will depend on whether or not Instagram can pay the bills.

The company has 2 billion monthly active users, which is close to the number of people who use Meta's Facebook. Meta's stock is down more than 70% this year with investors unsure about two major bets The long-term investment in the metaverse is to create hardware and software for a future internet. There is an initiative to improve the company's social media recommendation algorithm to better highlight content from people you don't know.

Adam Mosseri said in an interview that driving more revenue via Reels depends on getting advertisers comfortable with the format. The longer that takes, the less patience investors have. Mosseri said that the photo sharing website is facing a fair amount of pressure. I want to make sure we don't make any mistakes by pushing too hard or too fast.

Current social media users and the next generation are competing for relevancy. The app is leaning into its short-form video feature, Reels, as a way to get people to spend more time on the app, going head-to-head with Bytedance's TikTok. James Lee said that the move to stay relevant with the internet's tastes is important for maintaining user growth and for persuading advertisers to spend on the platform.

Lee said thatInstagram is more important to Meta than any of the other apps. Over the past 18 months, the number of users on Meta's legacy Facebook app has mostly stayed the same, while the amount it makes for each user has gone down.

It has been difficult for investors to wait to see if the experiment works. While Chief Executive Officer Mark Zuckerberg has said that Reels will start contributing meaningfully to revenue in 12 to 18 months, it's taking attention away from other parts of Facebook andInstagram that make more money, as Meta spends heavily on experimentation in virtual reality. Since the report, the stock lost almost a third of its value, making it the second worst performing stock in the index.

Mosseri said that the fact that reels is popular is promising. He said that time spent looking at videos is a milestone. The company said last week that people on the platform re-share reels 1 billion times a day. As it blends new, short videos from people you don't follow with posts from friends, that is an important measure.

He said that the second milestone was getting Reels ads to make money as quickly as possible. We are on our way but not yet at the second milestone.

The photo and video sharing service is moving away from solely showing photos and videos from friends and accounts they follow, to the accounts they have been selected by, and what they are interested in. It takes a huge investment in coding the artificial intelligence tools to make it happen, and in the technology infrastructure to power it. Data centers and equipment are expected to be the main focus of capital expenditures next year.

Mosseri said that a ranking system that tries to surface what we call unconnected content of photos and videos from sources that you or accounts that you do not yet follow is a very different technical problem than ranking photos and videos from accounts that you already follow. In the last six months, I have been encouraged by the progress, but I think there is more room to grow.

It will inform the advertising business once the ranking system is improved. Meta is trying to find new ways to target users with relevant promotions in light of Apple's privacy rules.

The best talent will need to be found on the platform. The company is trying to win favor by offering more ways to make money, like selling NFTs or subscriptions to exclusive content.

The features were announced at an event in Los Angeles. The historic house was turned into a playground for video creation. The staff of the Content Crew wore T-shirts with the words "Content Crew" on them.

A lot of investors will start to feel better about the metaverse investment if the core business is fixed and IG reels is monetized. It's a bigger issue if they don't fix it.

First Published Date: 06 Nov, 19:41 IST