Instagram Is Putting YouTube To Shame

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Instagram has been pulling back from Reels big time. In fact, earlier this year, Meta stopped handing out Reels bonuses altogether and they’ve been pushing Reels less and less. At first, this may seem like a retreat from Meta’s side. They weren’t able to compete against TikTok and YouTube shorts and now they’re pulling back significantly, but that isn’t quite what happened. What really happened is that Meta actually made a clever business decision that YouTube hasn’t been able to make themselves. Zuckerberg noticed that promoting Reels over regular Instagram content was costing them as much as $500 million per quarter, so he’s taken a big step back when it comes to shortform content. This has largely preserved the profitability of Instagram which is already the 2nd most profitable social media platform in the world only beaten out by Facebook. In fact, Instagram pulls in almost double the revenue of YouTube today at over $50 billion per year. This video explains why Instagram is so profitable and why stepping back from Reels was actually the right decision.

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Timestamps:
0:00Reels
2:11Ideal Demographics
5:30The Facebook Effect
9:06No Need To Share

Resources:
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Logically Answered is centered around explaining the economics of tech and social media. These sectors are generally analyzed through the lenses of finance and economics to determine which industries and companies will thrive and which will fall. In addition to this analysis, the content is often focused on the stories of various famous entrepreneurs such as Elon Musk, Steve Jobs, and Jeff Bezos. Logically Answered also cover the rise and fall of several interesting companies and services that we come across on a daytoday basis. There have been so many companies that have risen to fame and then died out in a single generation. The most interesting companies are the ones that were able to save themselves and avoid bankruptcy. Feel free to follow the podcast if you would like to see any of these topics Logically Answered.

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