Facebook tests auto-play videos, explores video ad potential

Facebook Inc is testing videos that play automatically on mobile versions of its service, setting the stage to turn the 1.15 billion-member social network into an attractive venue for lucrative, television-like video ads.

The videos will be silent when they appear in a Facebook user's newsfeed, but expand and play the audio when clicked, the company said in a post on its official blog on Thursday.

Only videos posted to Facebook by individual users, celebrities or musicians will have the auto-play function during the test, Facebook said. But it noted that it would "explore how to bring this to marketers in the future."

The test, which involves a small group of U.S. users, is likely to ratchet up expectations for Facebook video ads. According to several media reports in recent months, Facebook is planning to charge brand marketers $1 million to $2.4 million to show 15-second auto-play video ads on its social network.

Facebook's stock set a new all-time high of $45.62 on Thursday, as investors anticipated new revenue sources such as video ads and ads in its popular Instagram photo-sharing app.

By conducting a small test before selling auto-play ads to advertisers, Facebook will be able to make sure the technology is up to snuff and to gauge users' response.

"Because bringing video to life in a feed is something that's going to really change the way users' experience Facebook we wanted to sort of tread water lightly and start with this and see how it goes," said Facebook spokeswoman Momo Zhou.

Auto-play videos will work on Facebook's mobile apps for smartphones running Google Inc's Android software and Apple Inc's iOS software.

In internal tests so far, the auto-play ads did not seem to significantly reduce battery life, Zhou said. The videos stop playing once a user scrolls past them in the newsfeed, she noted, and users have the option of switching off the auto-play feature.

Auto-play will work only with videos that users upload directly to Facebook. Videos from external websites such as YouTube will not work with the auto-play feature in the test.

Facebook does not expect the auto-play videos to have a big impact on smartphone users' wireless data usage and monthly phone bills, Zhou said.

© Thomson Reuters 2013