Investing.com - After Alphabet (NASDAQ:GOOGL) and Apple (NASDAQ:AAPL), it is now time for Facebook (NASDAQ:FB) to make its first step into original programming. According to sources familiar with the matter, Facebook reached out to Hollywood studios about producing TV quality shows.
Facebook is reportedly willing to commit as much as 3 million dollars per episode produced, according to the Wall Street Journal. Among other shows said to being in the works are "Strangers", a relationship drama, and "Loosely Exactly Nicole", a comedy cancelled by Viacom's MTV earlier this year.
Unfortunately, Facebook is rather late to the party, and many tech giants are already running similar operations, with Netflix (NASDAQ:NFLX) and Amazon (NASDAQ:AMZN) leading the pack in terms of content production.
Facebook is unlikely to compete with either soon, and its efforts are more likely an attempt to not fall behind Apple and Alphabet. Apple has recently hired former Sony executives and is looking to create shows for Apple Music, while Alphabet launched a subscription based version of YouTube called YouTube Red, featuring original content from prevalent YouTubers.
Investors should monitor the situation for a few reasons. First, original content is known to be an expensive venture, burning through cash, which will affect cash flows and balance sheets of all the companies involved.
Second, aggregating user submitted content and creating your own are two very different ventures, and it is questionable whether Facebook, Apple or Alphabet has the expertise needed to succeed in this field.
Finally, the original content space is crowded. With Netflix, HBO and Amazon already operating at a large scale, Facebook's, Alphabet's or Apple's ability to grab a share of the viewership is anything but guaranteed.