Creator Economy
By Kaya Yurieff Hello!
Before we get into Meta Platforms' first quarter earnings report, we have some new details about internal changes happening at Instagram as a result of Meta's latest job cuts.
Instagram chief Adam Mosseri, in a note to Instagram employees last week, said the app needs a "flatter structure that gives everyone the opportunity to meaningfully contribute to our highest priority projects." That means Instagram is doing some internal shuffling and will have four product groups called Sharing, Home, Communities and Business, according to the memo, which The Information viewed.
The descriptions of each team gives a view into Instagram's main priorities as a company, which include creators and teens, as well as positioning the app as a place for entertainment and connecting with people you know. This is an extension of the three priorities Mosseri laid out publicly at the beginning of this year: "inspire people to be creative," "help people discover things they love" and "spark connections between people." But it's more concrete and shows how much Instagram's focus has morphed. In late 2021, Mosseri said the priorities for 2022 included doubling down on video, messaging and creator monetization.
Here's what the memo laid out:
• The Sharing product group will center on helping teens and creators make content, express themselves and connect with audiences. The division will also include the Creators and Reels product group. This team will also support Project 92, Meta's effort to create a decentralized social media network similar to Twitter. It's significant the company is still working on that initiative despite shutting down other crypto projects, such as NFTs on Instagram. It comes at a time when Twitter alternatives are proliferating after Elon Musk's acquisition of the company, including decentralized offerings like Jack Dorsey-backed Bluesky Social.
• The Home product group will focus on helping users "discover and interact with the people and things they love." The Reels Engagement team, which includes staff working on the Reels Tab, and the Instagram Design Systems team will also join this group.
• The Communities product group focuses on making the app "safe and equitable" so users feel like they can express themselves and build communities. It will move the "Relevance Integrity" team from Home to Communities. Such shifts will help it "dedicate more resources overall to our equity work, which will benefit Instagram, along with the rest of the family of apps," Mosseri wrote.
• The Business product group will remain focused on helping users find businesses and products. Its three "pillars" include opportunities, experiences and recommendations.
Plus Mosseri announced a personnel move: Connor Hayes, previously vice president of product management at Instagram, will take on a new role leading product and design for Meta's Generative AI organization, under Ahmad Al-Dahle, the memo said. Al-Dahle is vice president of AI, machine learning and core tech at Meta, according to his LinkedIn account. Instagram said it plans to fill Hayes' role. (See more on our Meta org chart.)
Instagram is also closing its London office. Mosseri, who announced he'd moved to London last August, will relocate back to the U.S.–Sylvia Varnham O'Regan and Kaya Yurieff
Now on to Meta's Q1 results…
Meta's advertising business is on the upswing after three straight quarters of declines. That's a sign of hope for creators—especially after YouTube's lackluster results Tuesday. On Wednesday, the Facebook parent company's revenue rose 3% to $28.6 billion during the first quarter compared to the same period last year.
Meta is also signaling good news ahead: It projects second-quarter revenue growth will increase by as much as 15.5%. The stock rose in after-hours trading on Wednesday.
The company's call with investors was dominated by talking about artificial intelligence, which could include introducing "AI agents" or chatbots, CEO Mark Zuckerberg said. Meta is exploring chat experiences in WhatsApp and Messenger, visual creation tools for posts on Facebook and Instagram and ads, and over time, video as well. "I expect that these tools will be valuable for everyone from regular people to creators to businesses," he said.
Zuckerberg disputed media reports that the company was backing off from the metaverse, a more immersive version of the internet. "A narrative has developed that we're somehow moving away from focusing on the metaverse vision, so I just want to say upfront that that's not accurate," he said. "We've been focusing on both AI and the metaverse for years now, and we will continue to focus on both."
Creators weren't much of a topic, a contrast with calls over the last two years. Meta CFO Susan Li did point to a challenge with Reels: People view a Reel for longer than disappearing Stories or a post on the feed, resulting in fewer opportunities to serve ads between posts. "That will make it likely more challenging to close the monetization efficiency gap than it was with Stories," she said on the call.
Zuckerberg also took the opportunity to point out a key new stat: Facebook now has 200 million daily active users in the U.S. and Canada. Is it just me – or was that a subtle jab at arch rival TikTok? The short-form video app recently announced it has 150 million monthly active users in the U.S.
See The Information's Creator Economy Database for an exclusive list of private companies and their investors.
Discord's revenue rose 44% to $445 million last year, The Information reported on Wednesday. That was a slowdown from 2021, when the chat app's revenue expanded 126%. Discord makes money from subscription fees.
TikTok is testing a new tool for users to create generative AI avatars, according to a tweet from social media consultant Matt Navarra. A TikTok spokesperson told The Information it's testing "a new way to create and share profile pictures" in select regions.
Montana's efforts to ban TikTok are facing some hurdles because Governor Greg Gianforte is asking legislators to make changes to the bill, The Wall Street Journal reported.
Darkside Media, a new media company focused on TV promotion and podcast production, launched this week. It was founded by Tom Dark, who previously worked at Warner Records for 19 years, most recently as the label's head of TV promotions and podcasting.
Spotify's leadership shakeups continue: Helen Lindqvist, who was head of operations, program management and talk editorial, announced she's leaving the company after six years. Her departure follows recent high-profile exits including Dawn Ostroff, Spotify's former chief content and advertising business officer; Nir Zicherman, global head of audiobooks; and Max Cutler, head of talk creator content and partnerships.
Dog Juice, a new weekly newsletter about pets by Bryan Reisberg and Chris Equale, started on started on Substack late last month. Reisberg is the owner of Maxine the Fluffy Corgi (975,000 Instagram followers), while Equale is dog dad to corgis Hammy and Olivia (823,000 Instagram followers on their shared account). The newsletter launched has already amassed more than 90,000 free subscribers. (Read our previous interview with Reisberg here.)
Tika the Iggy, a Canada-based Italian greyhound with 2.5 million TikTok followers, posted a video at TikTok's Toronto office in support of the short-form video app. "Is TikTok being banned? Not if I can help it," says the voiceover on the video. "We looked at the data and we decided the best way to convince the government to not ban TikTok? We need much more dog content. Duh!" Tika's account also shared the video on Instagram Reels.
Alphabet CEO Sundar Pichai's cautious management style showed up in his response to a new threat: TikTok, write my colleagues Jon and Amir, who profiled the executive.
Pichai thought Google's search engine, which hasn't changed much in more than 20 years, was due for an upgrade, and as more young people started using TikTok to search for things, that pushed Google into action.
For years, hundreds of staffers were assigned to work on a project dubbed the "Great Search Shift," with the goal of better personalizing results and adding more images and videos, according to two sources. Ultimately though, Pichai and his staff only made minimal changes, such as rounding corners for some images and videos.
"The company has been a juggernaut…and it was hard in that context to push people further," said Carl Bass, former CEO of Autodesk and a onetime adviser to Google co-founder Larry Page. Read the full story.
• Video: How TikTok Dances Trained AI to Perceive Depth (Vox)
• Lawmakers Want to Ban TikTok. Here's What Users Say Is at Stake. (The New York Times)
• So Your Kid Wants to Be a Twitch Streamer (Wired)
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Kaya Yurieff brings you everything you need to know about the booming creator economy, from the platforms to the people to the deals.
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Kaya Yurieff is a reporter at The Information covering the creator economy. She previously worked at CNN. Based in New York, she can be reached at kaya@theinformation.com or on Twitter at @kyurieff
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