Facebook adds video ads to News Feed

Facebook on Tuesday began serving up video ads that pop up and play when users check their news feeds.

The leading online social network said it is testing the new advertising technique this week with a clip teasing the new film 'Divergent'.

'Since September, we've been testing a way to make videos more engaging on Facebook, and as a result we've seen views, likes, shares and comments increase more than 10 %,' the California-based firm said in a blog post.

'We're beginning to test a similar video viewing format for advertisers.'

Video ads will play on mobile devices as well as when people visit Facebook from laptop or desktop computers.

On smartphones or tablets, video ads will be pre-loaded in the background when in range of wireless hotspots to avoid the rich downloads eating into users telecom service data allowances, according to Facebook.

'Videos will begin to play as they appear onscreen - without sound - similar to how they behave when shared by friends or verified pages,' Facebook said.

'If you don't want to watch the video, you can simply scroll or swipe past it.'

The clips could last for up to 15 seconds, and an advertiser wanting to reach all Facebook users aged between 18 and 54 might have to pay $2 million per day.

'This news further confirms that Facebook has abandoned social marketing in favor of standard push-style ads,' said Forrester analyst Nate Elliott.

'But if they're choosing to be just another online ad seller, this is a good move. Marketers love video.'

'We'll be watching to see how far and how quickly Facebook pushes these ads,' Elliott said.

'The company hasn't always been smart about testing new ad formats and rolling them out slowly, but that'll be important here to avoid compromising both the user experience and the video ads' effectiveness.'

Facebook, which like all free sites draws most of its income from advertising, reported in October that ad revenue in the third quarter rose 66 % from a year earlier to $1.8 billion.

The share of advertising income from connections by mobile devices to the network, watched closely by investors, accounts for 49 % of the total at Facebook.

Digital video ad spending in the US alone will top out at $4.15 billion by the end of this year, according to figures released this month by industry tracker eMarketer.

Google's video-sharing venue YouTube is expected to reap slightly more than 20 % of US online video ad spending this year, eMarketer said.

The television advertising market that Facebook is likely taking aim at with digital ads is huge, with $66.35 billion spent on marketing messages there in the United States this year, it said.

Ad spending next year on digital video formats is expected to increase to $5.79 billion in the US, while TV ad spending is expected to rise to $68.54 billion.