Facebook Inc (NASDAQ:FB) started rolling out videos and video ads on its Newsfeed over the last few months, ramping up the amount of video content it shows in the middle of December. And according to data from comScore, that ramp-up is having a positive effect.
Facebook leaps in top video site listing
Citi analysts Mark May and Kevin Allen examined the data from comScore and say Facebook Inc (NASDAQ:FB) became the fourth top video site on the Web. Of course Google Inc (NASDAQ:GOOG) is on top, followed by Netflix, Inc. (NASDAQ:NFLX) and AOL, Inc. (NYSE:AOL).
Facebook to see meaningful revenue from video
The Citi team estimates that video ads could add $2.8 billion in revenue over the first three years. In this year alone, they think video ads on both Newsfeed and Instagram will add more than $500 million in revenue to Facebook Inc (NASDAQ:FB).
Facebook Inc (NASDAQ:FB) releases its fourth quarter earnings report after closing bell today, and the Citi analysts believe management will focus some of their comments on early results from their video efforts. They also expect an update on how the social network is courting traditional television and video advertisers.
Facebook’s video business shows growth
Facebook Inc (NASDAQ:FB)’s video business has certainly been growing rapidly over the last few months, as both the number of unique video viewers and the number of total video minutes on the social network have grown. However, the Citi team does note that some of December’s growth was because comScore first started including video streams from Vine which use Facebook’s video player under Facebook’s results.
Analysts vary quite widely in how much revenue they believe Facebook Inc (NASDAQ:FB) will receive from video ads. In 2015, the Citi team is estimating $879 million, but analysts from Susquehanna International Group are quite a bit higher in their estimate. They believe the social network will see $1.1 billion in revenue from video ads in 2015.