Are You Ready for Facebook's New Ads? -- Tech Roundup

Facebook (FB) started as a social media company, generating millions -- and eventually billions -- of users. Those users turned into customers for advertisers, which began paying Facebook for the ability to advertise in users' news feeds and elsewhere on the site.

Now, the company's got a new experiment up its sleeve: mid-video advertisement.

As Facebook faces a slowdown in revenue growth, it needs to find new ways to continue growing its business. Having assets like Instagram -- where user growth remains quite strong -- and virtual-reality stalwart Oculus VR are sure to help. But in the short-term, it needs to continue growing its ad business in order to prevent investors from bailing on its stock.

In that respect, mid-video advertisements may be just the key to keeping the growth engine running. According to reports on the matter, after a user watches the first 20 seconds of the video, the producer will be able to insert an ad. The producer will receive 55% of the ad sales. Some videos may wait for 90 seconds before playing the ad.

While this is good for Facebook, and seemingly the producer as well, it remains to be seen whether this will turn off users. Will they bail after the first 20 seconds? Should they fail to be engaged in the beginning, it wouldn't be surprising to see them stop watching the video when the ad comes on.

Then again, that's why the company is testing it and not doing a full-blown rollout. Time will tell if the ad presentation is a success.

Shares of Facebook closed at $124.90 Monday, up 1.2%.


Alphabet (GOOGL) is getting pretty serious about its self-driving car ambitions. The unit, renamed Waymo, may not power the sexiest vehicle on earth -- a minivan -- but its brains are the real draw.

Fiat Chrysler (FCAU) had teamed up with Waymo in order to make the latter's intense research and testing of autonomous driving tangible and ready for the open road. Testing on public roads in California will begin this week.

For some companies, they plan to do both: Produce automobiles and research and develop self-driving capabilities. In other cases, like Fiat, the automaker is just a car producer and will seemingly rely on others (like Waymo) for autonomous driving. In Google's case, it has been refining the technology for the better part of 10 years, while still having no actual cars to deploy the technology in.

Waymo's aim isn't just Fiat though. The company has begun producing all the components itself that are needed to go autonomous. The plan basically goes along the lines that Waymo has developed the necessary equipment for self-driving cars and can then implement it among a number of different producers.

If other automakers join up with Waymo, that will likely pave the way for profits, and thus another pipeline for Alphabet.

Shares of Alphabet closed at $118.99 Monday, up 0.9%.

Alphabet and Apple (see next item) are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells GOOGL or AAPL? Learn more now.
 


Last week, there was a bit of a fiasco surrounding the New York Times app on Apple's (AAPL) App Store in China. Well, now another app-store related issue has sprung up, this time in Russia.

The country has demanded that both Apple and Google remove the LinkedIn (LNKD) app from their respective app marketplaces. The moves comes "weeks after a court blocked the professional networking service for flouting local laws that require internet firms to store data on Russian citizens within the nation's borders," according to the New York Times.

The tech companies are caught in sort of a weird position. When a country bans a particular site, like LinkedIn for instance, the apps are still available. Although the apps no longer function correctly, the government then presses companies like Apple to remove their availability.

Where should tech companies stand? If the service is banned in the country, it may be hard to justify maintaining its availability. Besides, should Apple or Google really have a say in what should and shouldn't be allowed in certain countries?

Regardless of the answer, the companies also realize they have interests to protect as well. Being banned in China or Russia or any number of countries for not removing an already-blocked app from the market place could risk future sales and profits for themselves as well.

Shares of LinkedIn closed at $195.96 Monday, flat on the day.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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