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Shares in Facebook (FB) Jump on News of Instagram Ads

By  +Follow October 4, 2013 5:31AM
Tickers Mentioned:

Shares in social media giant Facebook (FB) spiked Friday on news that it would start selling ads on the photo-sharing service Instagram. News that Facebook would begin monetizing their $1 billion acquisition from last year pushed shares up almost 3.5 percent.

Instagram to Ease Users In

Instagram assured users in a blog posting that it would make efforts to prevent the new ads from interrupting their users’ current experience.

“Our aim is to make any advertisements you see feel as natural to Instagram as the photos and videos many of you already enjoy from your favorite brands,” Instagram said on the blog. “After all, our team doesn’t just build Instagram, we use it each and every day. We want these ads to be enjoyable and creative in much the same way you see engaging, high-quality ads when you flip through your favorite magazine.”

”Seeing photos and videos from brands you don’t follow will be new, so we’ll start slow. We’ll focus on delivering a small number of beautiful, high-quality photos and videos from a handful of brands that are already great members of the Instagram community,” the blog post continued.

The $1 billion deal to purchase Instagram in April of last year appeared peculiar to many at the time, coming as Facebook was ramping up for its IPO and appearing to buy a steep premium on the small company’s value. However, the long-term strategy may appear clearer after today’s announcement.

Mobile Presence a Focus With Pending Twitter (TWTR) IPO

Many analysts believe the push to increase ad revenues through Instagram is a positive move for Facebook.

“There just continues to be momentum, continues to be good news,” said Benjamin Schachter, an analyst at Macquarie Securities USA Inc. “Even though the Instagram news was somewhat expected over time -- we’ve been waiting for the announcement this year, and yeah, it’s going to be a positive.”

The move comes one day after Twitter ($TWTR) opened its confidential IPO. News outlets have compared the two companies, with a particular focus on mobile ad revenues, noting that 65 percent of Twitter’s ad revenue was coming from mobile as compared to just 41 percent of Facebook’s. As more and more users shift to mobile, Facebook’s ability to monetize ads in that area is believed to be crucial, and Instagram could ultimately prove to be an essential piece of that puzzle.

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Results for FB
Future Tech Investor
27 May 15 10:07:10
Nelson Jr.
27 May 15 10:06:27
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27 May 15 10:03:50
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27 May 15 10:02:52
$FB_052915C80.5 Qty 1103 at 0.32 Ask $ 35296 Vol 3693 OI 7917 TimeOfTrade 1:02:51 PM
Ravi Romo
27 May 15 09:58:29
RT @JBoorstin: "Facebook seems more interested in content than Google is" Les Moonves at #CodeCon $CBS $FB $GOOG
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john wright
27 May 15 09:56:14
RT @JBoorstin: "Facebook seems more interested in content than Google is" Les Moonves at #CodeCon $CBS $FB $GOOG
Julia Boorstin
27 May 15 09:55:59
"Facebook seems more interested in content than Google is" Les Moonves at #CodeCon $CBS $FB $GOOG
Quantpost Financial
27 May 15 09:55:18
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27 May 15 09:55:18
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Quantpost Service
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Quantpost $FB
27 May 15 09:55:18
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27 May 15 09:55:16
27 May 15 09:54:03
$FB $GOOG $K $KRFT: Facebook Inc (FB) and Google Inc (GOOG) Ad Numbers Need An ...: http://t.co/e2U9rT75Zk
27 May 15 09:51:08
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27 May 15 09:50:15
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27 May 15 09:50:15
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27 May 15 09:50:06
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27 May 15 09:49:05
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27 May 15 09:48:26
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27 May 15 09:48:25
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27 May 15 09:48:05
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Jacob Wolinsky
27 May 15 09:47:50
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Ian Nelson
27 May 15 09:46:11
$FB has been in a 75-80 range the last 10 months...a little above and a little below...i hope you are buying and selling at right times
TV_Trading Ideas
27 May 15 09:45:56
Gap at 78.50 $FB http://t.co/EuWUCiFrr2
Kris Sidial
27 May 15 09:44:11
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27 May 15 09:39:15
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By  +Follow October 4, 2013 5:31AM



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