Warner Bros. has officially declared they’re trying something new. Films in their library can be offered for digital rental by means of Facebook. The Facebook Movies system currently offers just a couple films, but the company has plans for expansion. Following this information, Netflix stock fell, and buzzes about Facebook Credits increased. Article source – Facebook Movies streams films directly with Facebook Credits by MoneyBlogNewz.
Warner Bros. leasing through Facebook
A brand new feature is available for Warner Bros. It is on a Facebook page. On Facebook, users can rent films and stream them. Only a few films, including "The Dark Knight," are accessible right now. About $3 is what is paid for a 48 hour rental with 30 Facebook credits. About 30 percent of Facebook users in the United States have access to this option right now.
Information hurts Netflix stock
The online rental business has gone down due to the Facebook Movies news. Shares went down three percent for Netflix after the announcement. This was just in the first hour though. Netflix presently accounts for about 20 percent of all online traffic. There was a report done in December 2010. It found that Facebook was responsible for about 10 percent of video-sharing traffic online. Netflix might start seeing some competition soon if the content becomes available to everybody considering the traffic of Facebook linked to the in-line video sharing.
The issue of Facebook Credits
Facebook's system of payment that will soon be essential can have Facebook Movies being the first non-game application to use it. The ratio for Facebook credits is 1 to 10. That means 10 Facebook credits are given for every $1 paid. It is possible that Facebook Credits will only be tied to the dollar for a short time. It could very well end up tied to something else soon. By creating its own monetary program, Facebook is creating the flexibility to increase income simply by adjusting its own conversion rate. Facebook could effortlessly change to nine Facebook credits per dollar instead. This would lead to 1.1 cents per credit purchased instead for Facebook. Just a tiny increase like this could make a huge difference for the company. This small increase is multiplied by billions for increased earnings.
Information from
Tech Crunch
techcrunch.com/2010/12/23/facebook-second-largest-source-videos/
Slate
slate.com/id/2273314/
Forbes
blogs.forbes.com/parmyolson/2011/03/08/now-you-can-rent-and-stream-movies-on-facebook/?partner=yahootix
Bloomberg
bloomberg.com/news/2011-03-08/netflix-falls-as-warner-bros-starts-offering-movies-on-facebook.html
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