What Happens to YouTube When Twitter's Video Efforts Take Off?

By Markets Fool.com


Twitter introduced the ability to capture video within its app earlier this year. Source: Twitter

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Last year, native Facebook videos overtook links to YouTube videos as the most popular way for media and publishers to share video content on the social network. This year, Twitter is working to copy Facebook's success in overtaking the Google subsidiary with native video features of its own. Nearly halfway through the year, YouTube links still outnumber the number of posts containing native video on Twitter by about 50%. But Twitter is gaining ground.

There are reasons to believe native video on Twitter will continue to gain popularity and YouTube will lose popularity on the platform. As the growth of native video takes hold on both Twitter and Facebook, YouTube may be relegated to a niche audience.

Twitter isn't Facebook
However, there are a few things working against rapid adoption of video on Twitter as compared to Facebook.

For one, there's no algorithm that automatically organizes tweets by content. Therefore, a tweet containing a native video is just as likely to be seen as a tweet containing a YouTube video. That's not the case on Facebook, where native videos reach nearly three times as many users compared to links to YouTube, according to a Socialbakers survey conducted for Business Insider. That's because Facebook's algorithms organizes users News Feeds to include more native videos compared to links that send people away from its website or app.

Additionally, in keeping with its strict restrictions on character count, Twitter videos are capped at 30 seconds. Some users may want to post longer videos, so they'll have to look elsewhere for those capabilities. Advertisers, however, are able to post videos of up to 10 minutes. There are no restrictions on video length on Facebook or YouTube for verified users. (It's worth noting that 30 seconds is the same length as a standard TV commercial, so users should be able to communicate a strong message in that time.)

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While those two factors are certainly working against Twitter, there's one factor that should certainly spur adoption. The engagement on native Twitter videos is much better than YouTube links. Despite fewer posts containing native video, the number of interactions with posts containing videos uploaded directly to Twitter nearly quadruples posts with links to YouTube.

Brands and publishers looking to engage their audience are better served by Twitter videos than YouTube -- at least on Twitter's platform.

Why YouTube should be scared of native video
As more social platforms -- Pinterest, Snapchat, etc. -- introduce native video content, YouTube runs the risk of becoming relegated to a niche audience. The Wall Street Journal reported earlier this year that YouTube's audience is mostly based on syndication on other websites. There's a very small core of users that actually visit YouTube.com regularly to watch videos. One analyst estimated just 9% of YouTube's audience accounts for 85% of video views.

YouTube relies on distribution from Facebook and Twitter to draw more viewers to its website, where it does its best to draw them in with video recommendations and autoplay videos. It also acts as a repository for publishers to store videos they publish and display on their own websites. After introducing embeddable video widgets, both Twitter and Facebook stand to replace YouTube as that video repository.

In light of the competition, YouTube finds itself investing more and more in original and exclusive content from some of its most popular channels. The investments aim to attract a wider audience to YouTube.com outside of that core 100 million or so.

YouTube's one huge advantage
YouTube isn't going anywhere anytime soon. While it may lose a good chunk of its audience from the rise of video on Twitter and Facebook, it has the biggest carrot of all to dangle in front of content producers: money. YouTube offers revenue sharing to video creators, which is something Facebook seems to be actively working on figuring out and Twitter is inching closer to with its acquisition of Niche.

For content producers looking to monetize their videos directly, YouTube remains the best option. However, the negative impact on YouTube's total reach from videos on other platforms could reduce the amount advertisers are willing to spend, even with cost-per-impression pricing. Brand advertisers, in particular, flock to where the biggest audiences live. But until other platforms like Twitter and Facebook figure out an effective way to share those brand advertising dollars with content creators, YouTube will continue to prove popular as a video repository.

Still, the profitability of YouTube will remain under question. After generating $4 billion in revenue last year, the company still wasn't profitable. The shift in ad dollars to platforms with wider audiences coupled with the company's increased investment in content will continue to pressure YouTube's profitability.

The article What Happens to YouTube When Twitter's Video Efforts Take Off? originally appeared on Fool.com.

Adam Levy owns shares of Apple. The Motley Fool recommends Apple, Facebook, Google (A shares), Google (C shares), and Twitter. The Motley Fool owns shares of Apple, Facebook, Google (A shares), Google (C shares), and Twitter. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.