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Last week Head of Instagram Adam Mosseri posted a video on Instagram about Instagram:

Hey everyone, I thought it would be good to start sharing more about what we’re currently working on at Instagram just to give you a sense of what is coming before it comes. Right now, we are trying to build new experiences primarily in four areas. The first is creators, and I’ve talked a lot about creators and trying to help them make a living. And this has to do with the shift in power from institutions to individuals across industries. The second is video. Video is driving an immense amount of growth online for all the major platforms right now, and I think it’s something we need to lean into more — and I’m actually going to talk about that more in a minute. The third is shopping. Now the pandemic shifted, or accelerated the shift of commerce from offline to online by a number of years, and we’re trying to lean into that trend. And the fourth is messaging. How people connect with their close friends has changed a lot over the last five years or so and it has moved primarily to Messaging and away from Feed and Stories products.

But today I actually want to talk a bit more about video. And I want to start by saying we’re no longer a photo-sharing app or a square photo-sharing app. The number one reason that people say that they use Instagram in research is to be entertained. So people are looking to us for that. So actually, this past week in our internal all hands, we shared, or I shared, a lot about what we’re trying to do to lean into that trend — into entertainment and into video. Because let’s be honest: there’s some really serious competition right now. TikTok is huge, YouTube is even bigger, and there’s lots of other upstarts as well. And so people are looking to Instagram to be entertained, there’s stiff competition and there’s more to do, and we have to embrace that. And that means change.

So what you’re going to see over the next couple of months really is us start to experiment more in the space of what we call recommendations, so showing you things in Feed that you may not be following yet. We just started testing an early version of this last week. This week is a new version that’s coming out with topics where you can say which topics you want to see more of or less of. But we’re also going to be experimenting with how do we embrace video more broadly — full screen, immersive, entertaining, mobile-first video. And so you’ll see us do a number of things, or experiment with a number of things in this space over the coming months. Now we have an idea of where we want to end up in half a year or a year’s time, but I’m sure things are going to change many times between now and then. This isn’t something that we can just do overnight. So you’ll see us iterate and try and be very public about what we’re doing and why with videos like this one. Anyhow, hopefully you’ll enjoy it.

Everyone that I’ve seen, from Twitter to my teenage daughter, is quite certain they will not enjoy it. Why does the beloved photo-sharing service have to copy everyone else, and not simply do what it is best at?

The reality, though, is that this is what Instagram is best at. When Mosseri said that Instagram was no longer a photo-sharing app — particularly a “square photo-sharing app” — he was not making a forward-looking pronouncement, but simply stating what has been true for many years now. More broadly, Instagram from the very beginning — including under former CEO Kevin Systrom — has been marked first and foremost by evolution.

From Tool to Network

It may be hard to remember now, but Instagram didn’t even start as primarily a photo-sharing app: it was a photo-filter app, focused on making photos look good on ancient iPhone cameras and posting them on other social networks. It was, to use Chris Dixon’s parlance, a tool that evolved into a network:

Instagram’s initial hook was the innovative photo filters. At the time some other apps like Hipstamatic had filters but you had to pay for them. Instagram also made it easy to share your photos on other networks like Facebook and Twitter. But you could also share on Instagram’s network, which of course became the preferred way to use Instagram over time.

This was certainly an innovative approach, but even then Instagram didn’t get off the ground in isolation: the app famously booted up its initial network on top of the Twitter graph, allowing you to easily discover and follow everyone you already followed on Twitter. Instagram’s success in doing so remains one of the most powerful arguments for interoperability as a means of driving competition; it is disappointing that regulations like GDPR have redefined privacy to make it impossible to carry your contacts to other services. The important takeaway for this article, though, is that Instagram was defined by evolution from the very beginning.

Video on Instagram

To that end, the idea that Instagram isn’t simply a photo-app is hardly original to Mosseri; Instagram founder Kevin Systrom defined the service this way in 2013:

When we joined Facebook, a lot of people asked me this question: What is Instagram? What is Instagram all about? It’s a tough question, not because it’s not discoverable, not because it’s intangible, but instead because it takes on a different form depending on who asks the question and who answers it. When I think about what Instagram is I think about moments, and I think about visual imagery. What I can tell you is that at our core visual imagery is everything. It’s in our DNA, and it’s what drives us…

Photos are certainly “moments” and “visual imagery”, but only a subset; video was the obvious evolution.

If we’re about capturing and sharing the world’s moments, what’s next? What do we work on? We’ve taken photos and made them beautiful, we’ve connected people from all different countries around the world, all different cultures. What do we work on next? I’m going to tell you a story. That story is September of 2010, and Mike, my co-founder, and I were sitting in front of a whiteboard pondering what’s next. Two entrepreneurs not really knowing what to do, what’s next. We were working on a small location-sharing app called Bourbon. As part of Bourbon you could share your location, and the two parts of sharing your location were posting a photo and posting a video. We decided that we needed to do something new, so we created Instagram out of Bourbon.

The one part that we brought was photos, but we left video on the side. Why is that? Because we said the three things we want to be really good at are speed, simplicity, and beauty. And I’ll you, at the time two years ago, with the devices as they were, speed, simplicity and beauty were definitely possible with photos. But it was really hard with video. Today that all changes, and Instagram is going to be at the center of it. I’d like to introduce Video on Instagram.

One of the defining characteristics of digital services relative to analog services is that they need not be limited by medium: a magazine can only ever have photos, while a television show can only ever be videos, but when everything is 1s and 0s there is no need to be constrained by one particular manifestation of those 1s and 0s. Instagram has understood this from the beginning; the fact it started as only a photo app was due to the constraints of technology, not ideology.

Algorithmic Feed

Instagram’s third evolution was the introduction of the algorithmic feed, which was met with handwringing that sounds rather similar to the responses to Mosseri’s video. I wrote in 2016 in a Daily Update:

As is their wont, The New York Times got comments from not only analysts and Instagram executives but also a person-on-the-street, and this one delivered:

Vickie Mulkerin, a 49-year-old Instagram user…said she appreciated the immediacy of the Instagram feed. “I like how I can open the app and see what my stepsister Ashley is doing today with my niece and nephew, right in that very moment,” she said. “I want to judge what’s important, not have some algorithm tell me what it thinks is important.”

If you think that quote looks familiar, well, welcome to pretty much every story about the Facebook algorithm: users are sure they know better, but as any Facebook executive will tell you, users are much more engaged with an algorithmic feed…

One common misconception about why Facebook has an algorithmic feed is that it is to allow for advertising; that, though, doesn’t really make much sense. Facebook could include advertising in a time-based feed just as easily; indeed, that’s what the company does with Instagram today. Rather, an algorithmic feed is exactly what Facebook says it is: a way to drive engagement by showing users more of what they actually want to see, and, by virtue of driving engagement, gaining the opportunity to show users that many more ads.

Mosseri cited user research showing that Instagram users use the app for entertainment, but I strongly suspect that the service is even more convinced by the way users actually use the app: Facebook knows better than anyone that, when it comes to their services, revealed preference — what users actually do — is a far more powerful indicator than stated preference — what they say they want.

This was the biggest lesson from one of the most important episodes in Facebook’s history: the introduction of the News Feed, which was met by protests both on Facebook (naturally), and even outside of the company’s offices in Palo Alto. The irony, as David Kirkpatrick noted in The Facebook Effect, is that the reason protests sprung up so quickly is that the News Feed worked: it surfaced and organized information that users cared about in a way that was only possible with an algorithmically-driven Internet service. Facebook added some token privacy controls to mollify those initial objections, but the company didn’t compromise on the concept itself, which became the foundation of the company’s explosive growth and, it should be noted, was copied by everyone else — including Instagram.

Stories

Instagram’s biggest shift, though, and the episode from which you can draw a straight line to Mosseri’s video, was its introduction of Stories. While a feed was native to digital — endless content, customized to you — Stories, pioneered by Snapchat, were native to mobile specifically. They filled your entire screen and either advanced on their own or with a simple tap; their ephemeral nature was also a powerful lure to keep you coming back to the app day-after-day.

What was impressive about this shift was, in fact, the shamelessness; I called it The Audacity of Copying Well. What differentiated Instagram was the product of its initial evolution — the network — and adding a new format to that network was, broadly speaking, no different than adding an algorithmic feed. Now you could access “Moments”, to use Systrom’s parlance, in what was frankly a better format. That may have seemed controversial at the time, but five years on Instagram knows better than anyone the degree to which users prefer Stories to a feed; speaking for myself I find myself only scrolling the Instagram Feed once my Stories have been exhausted — which rarely happens.

This shift did cause Facebook some short-term pain; advertisers were used to feed advertising, and it took a couple of years and some painful earnings calls for them to catch up to user behavior, but catch up they did. From a Daily Update earlier this year:

The most notable takeaway from last quarter’s results was the increase in prices-per-ad for the first time since the end of 2017.

That 2018 decline was driven by the push to monetize Stories, and while many interpreted Facebook’s somewhat middling results in 2018 as a reason to be bearish, I was optimistic Stories were a big opportunity; I predicted in a Daily Update from August 2018:

The key thing to remember is that advertisers always lag users: there were millions of people using the Internet on desktops before advertisers really got on board, and then there were hundreds of million of people using mobile before advertisers came along. In every case some analysts made the mistake of assuming that advertising would never catch up, but it eventually did, and it seems far more likely than not that the story will be the same for Stories…

This is exactly what has happened. Increasing usage of Stories increased impressions, which is deflationary, but as advertisers have embraced the format that has increased competition for those impressions, ultimately increasing prices.

Facebook’s business results give credence to my anecdotal observation about user behavior: people click through Stories far more than they scroll through their feed.

Taking on TikTok

One thing that Mosseri was certainly right about is that TikTok is a serious competitive threat to Facebook. App Annie reported in its State of Mobile 2021 report that in the United States time spent on TikTok had surpassed both the Facebook app and Instagram:

While the FTC didn’t even mention TikTok in its antitrust case against Facebook — small wonder the suit was dismissed for lacking a reasonable market definition — this is clearly a big problem for an advertising-based business. The defining characteristic of digital is abundance, thanks to the zero marginal cost nature of transmitting 1s and 0s, which means that time, thanks to its inherent scarcity, is the most important plane of competition.

TikTok, though, has been particularly difficult for Facebook and Instagram to respond to for three reasons:

• First, if Instagram has been defined by sharing moments, TikTok has been about manufacturing them, with easy-to-use tools that commoditize creation.
• Second, TikTok has defined a new format, distinct from both a scrollable feed and tappable stories: swipeable videos that are melding of both. TikTok provides both an endless feed and a full-screen immersive experience that is easily navigable.
• Third, TikTok isn’t really a social network at all, which freed the service to surface the most compelling content from anywhere in the world, not simply from your network.

The first issue was easier to address, which is how we came by Instagram Reels. Sure, it may not be as intuitive as TikTok’s video editor, but Reels is improving rapidly. The problem for Instagram, though, is that building tools is relatively easy; creating a virtuous cycle of creation and consumption is much more difficult.

This is where the shift to Stories created an opportunity: if you look at the Instagram home screen, the vast majority of time is spent in a relatively small amount of space:

While Reels did recently get its own tab at the bottom, I suspect that Instagram’s plan is to push Reels content into that main feed, and as Mosseri noted, that includes content from creators “you may not be following yet.” In other words, Instagram, having shifted the primary use case of the app from the Feed to Stories, is going to transform said feed to address its two remaining shortcomings relative to TikTok: a new consumption experience, and content from anywhere.

This is a risky shift, to be sure, but so was the shift to Stories; I wrote at the time:

It’s not certain Facebook and Instagram will succeed, and the risk is significant: the only thing harder than rewiring users’ expectations for a massively successful product is ensuring said rewiring doesn’t turn them off from the app entirely, destroying the very value you are trying to leverage.

Facebook, though, also knows the danger of standing still.

The Entertainment Goal

To this point I have framed Mosseri’s announced changes in the context of Instagram’s continual evolution as an app, from photo filters to network to video to algorithmic feed to Stories. All of those changes, though, were in the spirit of Systrom’s initial mission to capture and share moments. That is why perhaps the most momentous admission by Mosseri is that Instagram’s new mission is simply to be entertainment.

In truth, though, this has always been social media’s most important job. Back in 2015 I argued in Facebook and the Feed that the company was constraining itself by only thinking in terms of its network:

I suspect that Zuckerberg for one subscribes to the first idea: that people find what others say inherently valuable, and that it is the access to that information that makes Facebook indispensable. Conveniently, this fits with his mission for the company. For my part, though, I’m not so sure. It’s just as possible that Facebook is compelling for the content it surfaces, regardless of who surfaces it. And, if the latter is the case, then Facebook’s engagement moat is less its network effects than it is that for almost a billion users Facebook is their most essential digital habit: their door to the Internet…

This course, though, depends on Facebook giving users exactly what they want, or at least a good enough mix, in their News Feed, and as I noted, I’m not convinced personal updates is enough. Moreover, while Facebook may view “the network” as their differentiator, the fact is that a lot of “friend” sharing is indeed moving to alternative networks like Snapchat and LINE and WhatsApp. With this News Feed update I am concerned that Facebook is limiting itself and committing to a battle — the private sharing of information — it can’t necessarily win.

Consider Facebook’s smartest acquisition, Instagram. The photo-sharing service is valuable because it is a network, but it initially got traction because of filters. Sometimes what gets you started is only a lever to what makes you valuable. What, though, lies beyond the network? That was Facebook’s starting point, and I think the answer to what lies beyond is clear: the entire online experience of over a billion people. Will Facebook seek to protect its network — and Zuckerberg’s vision — or make a play to be the television of mobile?

Six years on and it seems likely that Facebook’s usage is at best holding steady — it was reportedly declining before the pandemic — and at a minimum declining relative to the competition; meanwhile, the service has been transitioning to much more of a utility, with a greater focus on Groups and offerings like Marketplace. Perhaps that was ultimately the best path for an app so deeply tied to the idea of a social network, but it also gives that much more of an impetus for Instagram to shift to an even broader vision: a one-stop shop for entertainment on your phone.

Of course the network isn’t going away: Facebook has leaned into the aforementioned shift to private messaging across its platforms, including Instagram; I probably should have added the 2013 addition of Instagram Direct to the number of ways the service has evolved over the years — it’s a long list! Indeed, that is the real answer as to what Instagram, particularly under Facebook, is ultimately about: moments, yes, but their fleeting nature. Instagram may have started with a goal of preserving them, but it has never been a service particularly concerned about getting stuck in them.