History was made today as the Facebook IPO hit the market. Eyeballs around the world were glued to cable news today reporting on every move of the stock and the company that began in a Harvard dorm room. So how should TV companies react to the news? “Facebook claims to be an ideal partner for TV companies,” explains the social TV research company Futurescape. “It can help them market their shows and engage their viewers. Yet it competes with broadcasters for $196 billion in worldwide TV ad spend and will impact the $236 billion global pay-TV market.”
So should the industry be concerned that Facebook will find a way to tap into their advertising stronghold? Should they be spending dollars on Facebook advertising to drive viewers? We spoke with FOX Business Network anchor Cheryl Casone who was reporting on the IPO today for the network.
Lost Remote: How do you think TV companies specifically are reacting to the IPO? How will this affect their business models?
Cheryl Casone: The biggest question for TV companies is how much they want to spend on Facebook advertising buys. There seems to be some real question as to how effective ads are now that more Facebook users are using mobile devices that don’t display ads like desktops do.
LR: Will Facebook be able to tap into TV ad dollars? Should TV networks be scared?
Casone: I think Facebook should be nervous, not television networks. Content is still king and television production companies still hold the cards when it comes to Facebook. The social media site has many uses, but they are far from ready to compete on the TV level. They need TV not the other way around.
(Facebook ringing the bell this morning. Photo by NASDAQ)
LR: Do you think it’s important for TV brands to use Facebook for marketing, content development ads and more?
Casone: Yes, yes, and yes. Facebook is an excellent way to target viewers who are more than happy to post their likes and dislikes. It is a treasure trove of potential viewers but television companies can use Facebook virtually for free. Good for TV…..bad for Facebook!
LR: Have you spoken to anyone specifically in the TV industry to gain their perspective on the IPO?
Casone: I have had some off the record conversations and the jury still seems to be out as to what Facebook’s IPO means for our industry. At this point Facebook doesn’t seem to be a threat to TV. Hulu and YouTube are what they worry about.