Facebook is reportedly trying to enter the original content arena.
The social media company has already acquired unscripted shows from Buzzfeed and Vox Media, but several Facebook executives have been meeting with studio and talent agencies for more traditionally scripted TV shows, The Wall Street Journal reported on Sunday.
However, some observers believe Facebook is underestimating how difficult the barrier of entry is for an already established market.
“You have Netflix spending over $6 billion, Amazon over $4 billion and Hulu, who already has the connections with the studios,” Gerber Kawasaki’s Investment Group Leader Ben Dunbar told CNBC’s “Closing Bell” on Thursday. “It’s a tough space to come in at this point, and its very, very different from where Facebook’s been.”
Dunbar views Facebook’s venture into original content a “gamble” due to Hollywood’s perception of striking success as pure luck.
“Hollywood is a completely different monster. People have come into Hollywood for a long time and they dump money into it and then, you know, you don’t see success,” Dunbar said. Facebook is “doing really well in all their other businesses, but content is a gamble.”
The social media giant reportedly wants to produce content that avoids politics, news and nudity, the edgier subjects that have often pushed shows from HBO, Showtime and Netflix into popularity.
Los Angeles Times television and media news writer Steven Batagglio believes that despite the $3 million Facebook is willing to spend per episode (the same price tag several AMC and Netflix episodes have), the generous budget means very little with limited creative freedom.
“What attracts creative people — and name creative people — to streaming services is creative freedom,” Batagglio said. “They can do pet projects and they can push the boundaries in terms of content, and they probably will do it for less money than they would get otherwise from a conventional broadcaster if they … could pursue an idea that they really want to do.”
Instead of pursuing original content, Dunbar believes Facebook, which acquired Oculus in 2014, could find more success within a smaller market like VR media and entertainment.
“Within their realm is in VR … they have the Oculus, they are already ahead of the game compared to most companies,” Dunbar said. “If they can create content with that on that platform, they are unique in that space, and they’re not … fighting a battle with every other company who wants to get into media cause that’s the hot thing right now.”