Instagram head Adam Mosseri feels an 'urgent need' to make reels

Instagram head Adam Mosseri feels an ‘urgent need’ to make reels

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

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

Instagram is a major growth driver for the company, with 2 billion monthly active users worldwide, approaching 2.96 billion users. World Health Organization Use Meta Facebook. Meta stock is down more than 70% this year, with investors unsure of two major bets. There is a long-term investment in metaverseCreating hardware and software for a future that fuels virtual reality Internet. And in the near term, there’s an initiative to improve the company’s social media recommendations algorithm, to better highlight content from people you don’t know — particularly in Reels, the video format that is taking over Instagram.

Getting more revenue through Reels depends on making advertisers comfortable with the format, enticing creators to get involved there and improving recommendations, Adam Mosseri, head of Instagram, in an interview. And the longer it goes, the less patience investors will have for the dollars that go into metaverse territory. Mosseri said Instagram is facing “a fair amount of urgency”. “I’m trying to balance that urgency with making sure we don’t make any mistakes by pushing too hard or too fast.”

Instagram is locked in a battle for importance among the current ones Social media and next generation users. The app tends to feature the short video, Reels, as a way to get people to spend more time on the app, and compete head-to-head with Care Ltd. tik tok, which popularized coordination. James Lee, managing director at Mizuho Securities, said Instagram’s move to stay relevant to Internet tastes is important to maintain user growth and to persuade advertisers to spend on the platform, even as marketing budgets shrink.

“Instagram, by far at the moment, is probably one of the more strategically important assets of the Meta” than any of the rest of his family appsHe said to me. The number of users in Meta Legacy Facebook The app has largely stabilized over the past 18 months, while the amount it offers per user has fallen to the lowest in six quarters.

But waiting to see if the Instagram experiment pays off is inconvenient for investors. While CEO Mark Zuckerberg has said Reels will start contributing meaningfully to revenue in 12 to 18 months, for now it’s taking attention away from other parts of Facebook and Instagram that are making more money — an opportunity cost of $500 million. Dollars in the last quarter, like Meta, are spending heavily on experimentation in virtual reality and artificial intelligence. The stock has lost nearly a third of its value since the report, becoming the second-worst performer on the Nasdaq 100 this year.

However, the fact that Rails is popular is promising, Mosseri said. He explained that the time he spends looking at the videos is a “major milestone”. The company said last week that people on Instagram retweet Reels a billion times a day through direct messages. This is an important metric for Instagram because it mixes new, short videos from people you don’t follow, with friends’ posts.

A second achievement, he said, is getting Reels ads to make money as fast as marketers elsewhere can spend it on the app. “We’ve achieved stage one – we’re on our way but not yet into stage two.”

Instagram is moving away from displaying photos and videos exclusively from friends and the accounts they follow, to those defined by an algorithm and what it extracts from a person’s interests. This requires a huge investment in coding AI tools to make this happen, which is still in progress, and in the technological infrastructure to power it. Much of the expected growth in incremental capital expenditures across Meta next year will go toward data centers and equipment.

“A rating system that tries to highlight what we call the offline content of photos and videos from sources that you are or accounts you haven’t followed yet is a very different technical issue than ranking photos and videos from accounts you actually follow,” Mosseri said. “I’ve been encouraged by the progress especially in the past six months, but I think there is a lot, a lot of room for expansion.”

Once this ranking system is improved, it will not only help capture the attention of Instagram users – it will help inform advertising business. Meta is trying to find new ways to target users with promotions related to following the privacy rules of Apple Inc. Which made it difficult to collect user data on iPhones.

Some path to Instagram to increase relevance will also require attracting top talent to its platform. The company continues to try to win favor among influencers and professional content creators by offering more ways to earn money, such as selling NFTs or subscriptions to exclusive content.

The features were announced at an event in Los Angeles on Wednesday, in the presence of social media stars. A historic Victorian Lombardy home has been converted into a video-creation playground. Staff wearing “Content Crew” jerseys captured videos in a variety of backgrounds, including a basketball court decorated in the familiar Instagram colors, and walls formed by large loudspeakers.

“If they are able to fix the core business and things change — IG reels are generating income and they are able to maintain engagement — I think a lot of investors will start to feel better about metaverse investing,” Lee told me. “If they don’t fix it, you know that’s a bigger problem to solve.”

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