Facebook recruits its top publishers for exclusive shows

“This is their attempt to turn their video tab into a YouTube-like experience,” said a source.

Since the end of last year, Facebook has been on the hunt for entertainment content, which it would fund and distribute on a redesigned video tab on its mobile app. Facebook is looking at funding shows in two tiers: original shows, which it calls “hero” units, which would be 20- to 30-minute scripted and unscripted shows that Facebook would fully own; and “spotlight” shows, which would be shorter, four- to 10-minute formats, but not owned by Facebook.

Facebook is also looking at six broad genres, including science, sports, pop culture, lifestyle, gaming and teens. (One thing Facebook is not focused on is hard news programming, which has rubbed some news publishers the wrong way.) Budgets for Facebook originals are in the $250,000-per-episode range, which puts them in the low-end cable TV range, sources said. On the other hand, budgets for spotlight shows sit between $10,000 and $40,000 per episode, sources said.

Most of Facebook’s deals for video shows are within the spotlight program. The partner companies have sold multiple shows to Facebook for spotlight, which will retain exclusivity on those shows for only a certain period of time. According to sources, spotlight shows are exclusive to Facebook for seven days, after which the content owner is free to distribute it on their own sites and apps. Two weeks after the Facebook premiere, spotlight shows can go to YouTube and other social platforms, sources said.

This is different from Facebook originals (the “hero” units), which would be fully owned by Facebook. For the originals, Facebook is in talks with and is buying shows from bigger TV production companies and networks, as well as some of the top digital publishers on its platform, sources said. The number of Facebook originals will be fewer than the number of spotlight shows.

One important distinction for spotlight shows is that Facebook is basically funding the cost to produce the content, sources said. After Facebook has recouped the cost by running mid-rolls during the episodes, the company will split any additional ad revenue with the content owners. Like YouTube, Facebook will take a 45 percent cut.

“They are paying for the production right now,” said a source. “I would bet, as this plays out, Facebook will ease back on these terms and make it more about mid-rolls fully compensating the original production.”

Facebook CEO Mark Zuckerberg has said as much: while Facebook is willing to fund content today, the company’s goal is to build an ad program that can support shows without Facebook needing to fund it upfront.

Originally, Facebook wanted to release its video shows in late May, and then in June in time for the Cannes Lions festival. That has been pushed back as Facebook gets to work on redesigning its video tab and figuring out how shows will be distributed and promoted, according to Recode.

Sources said that Facebook is looking to build a video tab that would promote its original shows first, followed by a rotating selection of spotlight shows, and then general content. With spotlight, Facebook is looking to promote six shows every day, and has been telling production partners that their shows will receive promotion on a specific day and time during the week, sources said.

“It’s a big, new endeavor for them and they have been super responsive when it comes to the creative and the pitches,” said one source. “But it didn’t surprise any of us that they’re not rolling out the shows in June, based on what they’re trying to accomplish.”