The “Threads” Lesson Coming for Almost All Media
Trying to figure out whether to consolidate comes down to determining complementary formats and contradictory needs
Why break something that’s already working is a part of Silicon Valley culture that I’ll never understand. Case in point: new reporting late last week suggests that Instagram is exploring spinning off Reels into its own app, disentangling it from the larger Instagram ecosystem, according to The Information. For all the internet’s favorite jokes about Reels being a cesspool of total crap, it is undoubtedly a successful product for Meta. Reels generate more than 200 billion views per day. To put that into proper context: there are 3.4 billion daily active users across all of Meta’s apps, suggesting an average of 58 Reels watched each day by nearly 40% of the globe’s population.
If that doesn’t suggest monopolization of information in a heavily consolidated world, I don’t know what does. But I digress.
Part of why Reels has seen such immense success is because it’s tied to an app that already exists as part of people’s daily, subconscious habits. An average person in the United States will open about nine apps per day, according to Buildfire. Monthly usage increases slightly to about 30 apps. But the average person also has about 90 apps on their phone, suggesting that about 60% of all apps downloaded go unused. Digital hoarding is a lifestyle we’ve all grown comfortable with so this doesn’t really matter to us; it does, however, mean everything to advertisers.
Those daily active or monthly active user metrics are the difference between immense profit and languishing in obscurity until all operations cease. Instagram is the fourth most used app globally. Reels now make up nearly 20% of all engagement on Instagram, according to eMarketer, which will represent more than $37 billion in ad revenue by the end of this year in the U.S. alone.
All of that is despite — and this is where the separation of church (Meta) and state (Reels) comes in — Reels being a genuinely terrible product that only works because it’s part of an app that people do enjoy. Accidental browsing of the early 2000s becomes mindless scrolling today. People complain that the feed pushes content they’re not interested in from accounts they don’t care about, shows repetitive content, features “reposted” content from apps like TikTok, and disincentivizes creators who complain about shoddier monetization opportunities and having to fit into a perceived algorithm.
It’s the difference between TikTok’s “For You” philosophy and Instagram’s more multi-use app approach. TikTok is purely for short form content; Instagram is for photos, thoughts, and videos. Trying to create an exceptional singular function app while catering to the whims of everyone is a fool’s errand.
It’s all a little contradictory, isn’t it? Reels is growing in usage, but people for the most part aren’t fans. They’re served by convenience, not desire. And convenience is the hole that Meta executives clearly see with TikTok’s hole in the market. That’s why it isn’t hard to see why Meta’s leadership is interested in spinning off Reels. You have:
Market Share Opportunity: With TikTok’s future still in question, the fight for short form video dominance is between Instagram (Reels) and YouTube (Shorts). But there really isn’t much competition. Reels sees about 4x the level of engagement with its short form content than Shorts. Add in Facebook’s Reels activity, and it becomes the largest short form video app overnight.
Overall Satisfaction: Those aforementioned jokes about how bad Reels is, and how much people on Instagram don’t want force fed content when they just want to see what their friends are up to, could lead to larger dissatisfaction amongst a wide portion of Instagram’s base.
Generative AI Experimentation: Mark Zuckeberg hasn’t shied away from public declarations betting Meta’s entire future on artificial intelligence, both in B2C and B2B spaces. Experimentation with editing (creators) and final product (advertisers) in a space that’s potentially more open to receiving this content because of overall velocity could help Meta train their models more efficiently.
Threads and Facebook Precedent: Perhaps the most obvious, but — this is what Meta does. Instagram is separate from Facebook; Threads is separate from Instagram. Neither of these apps seem to suffer from the separation. Threads has 300 million monthly users, larger than X. One could argue both have benefitted from developing their own spaces and culture away from the main mothership.
Trying to determine when to consolidate everything into one app and when to expand by launching new ones is an area where I spend a lot of time. Companies like Google have to think about it across the entire suite of productivity and entertainment (YouTube) experiences. Netflix has to think about it when debating between bringing the ability to play games into its mobile and TV apps or leaving them as separate entities. Spotify executives contemplating the balance between audio and video.
Deciphering between complementary formats and contradictory needs is exceptionally more difficult as demands for certain experiences within different apps start to blur. In the context of Reels, there is a difference between Threads and Instagram or Instagram and Facebook in a way that doesn’t exist with Reels and Instagram. Reels is complementary to Instagram. The divide between photos and videos is not as stark as videos and text. That’s why Reels was launched within Instagram back in 2020 as opposed to a separate app (like Meta’s Lasso in 2018). Not to mention that Instagram’s more than two billion monthly active users provides a pretty good springboard for engagement.
Data is where it always comes back to in these conversations. Data collected for complementary formats helps to build a singular experience designed to capture the most attention by expanding upon the original reason someone opens an app. Showtime being part of Paramount+, videos being added to Spotify, and YouTube adding licensed films to its user generated content. Complementary formats add to the overall scale of the immediate offering, but don’t distract from the original incentive.
Contradictory needs, however, apply to activities that circle similar interests but ultimately distract from the main product. Games on Netflix. Fantasy football and ESPN. Like I said, everything comes back to data. In order for these experiences to really work, data about user activity, habit, and demands can’t be influenced by other activities. Data around Reels, therefore, may skew because of all the other acts (talking to friends, building group chats with family) that happen inside Instagram. It’s ridiculously difficult to determine that in a noisy environment where signals get crossed all the time.
How do you train data for Reels algorithms hyper targeted to each individual account when those individuals are also interacting with friends and family? Is the same content they’d like or share on TikTok different from the type of content they’d interact with on Instagram? Pretty likely! But Instagram’s teams can’t glean that information because it’s all one giant melting pot of noisy data.
Anecdotally, I only share football Reels on Instagram via my Stories because that’s what my friends and I talk about. I don’t, however, want a feed of nothing but football. TikTok barely showed me any football because I didn’t share those videos. Once we start sharing, we’re down a rabbit hole of our perceived interests surfaced right to us. That’s why all of our experiences across different apps change, even if our own interests and personalities don’t.
Noisy data makes Reels a bad version of a wanted experience, and it turns Instagram into its own cluttered maze.
Ironically, this moment facing Instagram provides a pretty good peg to look at decisions that several other media companies will have to make in the same vein. And that gives us a perfect opportunity to talk about complementary formats and contradictory needs. Both are important; both come up in consolidation talks. One, however, is habit forming and the other is empire building.
The Threads Lesson
I try to approach these scenarios by asking who the ultimate audience is, what is the impact of alienating other audiences, benefits and consequences of each decision and, most importantly, incentives for creators and fans. If Reels were to split into its own app,
The ultimate audience is those solely seeking out short-form video content to scroll through
This alienates audiences who want a balance between intimate social media (friends, families, Stories, and photos) and entertainment
It benefits advertisers, Meta, and creators hoping to reach an audience specifically interested in short form video
Consequently, this impacts the number of times per day someone might open an app because it’s designed for one activity
All of which creates incentives for audiences to scroll more
But it also disincentivizes creators from spending more time on activities where ultimate connection is made (Stories, Grid) in hopes of finding audiences through another app
Instagram and Facebook’s biggest advantage with Reels is also its biggest disadvantage right now: it successfully exists as its own product within the confines of another. Complementary formats — including everything from entertainment to personal content and being able to scroll vertically for one and tap horizontally for another without much training — help turn Instagram and Facebook from apps that serve one specific need to a universal place for most leisure time. Instagram with Reels expands on a function; Reels on its own double downs on an activity. At Posting Nexus, we like using shoddily drawn diagrams to further explore hypotheses. So…
If you’ve spent any time with Threads, you can see why Instagram C.E.O. Adam Mosseri feels like splitting off the app may be more beneficial overall. Meta’s not-so-secret weapon is the interoperability that exists between apps. Sending a Thread to someone on Instagram, even if they don’t have Threads, is purposely easy. Since these apps are built on the same messaging technology, while someone’s preferred app may differ, sharing those funny or deranged posts exists within one easy ecosystem. It looks kind of like the diagram below.
If it’s easy enough to post and share content across all major platforms, then Meta’s advantage becomes one of large-scale dominance as opposed to doubling down on one significant app. Instagram has more than two billion monthly active users. Threads has 300 million. Facebook maintains about three billion. Back in November, Instagram C.E.O. Adam Mosseri announced that Threads was moving away from using people’s individual Instagram networks as part of the onboarding process, meaning that new Threads users wouldn’t necessarily see content from people they followed or were friends with on Instagram.
“We stopped doing that for people in a handful of countries for a few months and saw that those people used Threads more, not less,” Mosseri said. “So now we’re going to stop asking people to follow all the same accounts on Instagram that they do on Threads as part of the sign-up flow.”
As a result, Threads saw a pretty significant increase in usage. Threads MAUs jumped by nearly 40% between Q3 and Q4 2024. Unsurprisingly, people who are opening text-based apps, likely for news and political content — something that Meta’s executive teams shied away from prior to the Trump election but are surfacing more regularly today — want a different experience with a different group of people than who appears on their Instagram feed. So do people associate Reels with an activity closer to Threads (ie, a widely different experience built upon following different people and tied to topical interest rather than personal connections) or do they see it as a larger part of the Instagram experience?
Back when Meta launched Lasso, a TikTok competitor that allowed people to upload 15-second videos set against different songs, the bet suggested that Gen Z and Gen Alpha audiences would migrate over to another app if given the opportunity. Marketplace of ideas and whatnot. Its subsequent demise occurred less than two years after launch, and on the eve of Meta launching Reels…within Instagram. Again, marketplace of ideas and whatnot.
What Meta executives either failed to take into consideration or, more likely, just chose to accept while experimenting with their own capabilities, is if there’s an app that already solves a major problem, trying to create another standalone — burdening people with something else to open — isn’t going to work. But TikTok’s disappearance and YouTube’s decade-long algorithmic training of long-form content preference gives Instagram the opportunity to take over a space that is rarely available.
Reels’ biggest incentive is its ease of access via Instagram. It’s a low-lift effort for people who aren't inclined to seek out short-form video on its own, but who will use it during their allotted Instagram time. The problem is that this hurts creators who are looking to build businesses around audiences whose first choice is spending time with short form video, not just treating it as a dumping ground post-checking in on their crush’s Story. With TikTok being gone, and creators looking for a new place to go, does a standalone Reels app make the most sense?
Maybe — and it could solve the bigger issue Reels faces. Noisy data prevents machine learning tools from creating fundamentally addicting algorithms. Having a sole app that entices the most creative personalities, bringing in audiences who aren’t tied to their personal friends and family, and segmenting by interest rather than network, could make the feed much, much stronger. It could turn Reels into a decent product. This is the Threads of it all.
Threads didn’t have to be good; it just needed to be populated — and that’s an area Meta has the sole advantage in every single time.
Is it as simple as new behavior, new app when it comes to determining complementary formats and contradictory needs? Not necessarily. There’s a checklist to confer before deciding if a secondary app will further the empire’s reach or dissolute some of its power.
Building Out, Not Up
When Paramount Global brought Showtime into Paramount+, no one was really surprised. Streaming services work because of proper targeting and abundance of content (not necessarily originals). Adding in new batches and genres of content expands upon the core database, helping to establish better data for long term success. The more reads that Paramount+ analysts can get on audience clusters as evidenced by engagement patterns with new data, the better recommendation systems can become.
Think of it this way: complementary formats work for apps that struggle to compete with more invasive distractions (such as Instagram or TikTok) by bettering an already established format. Put another way: Showtime is just more TV, but it’s a different kind of TV than Paramount+ subscribers interested in Spongebob Squarepants or NCIS are accustomed to seeing. A combined effort also helps to establish value, theoretically reducing churn instead of asking subscribers to go to multiple apps, remembering what’s where.
Anyone who wants to disrupt that strategy by leaning on a multi app ecosystem, therefore must figure out:
Does this secondary app have the potential to generate enough time spent on it to create a competitive product?
How likely is it that this behavior the secondary app is targeting will exist 10 years from now?
Will this experience be better than the one we’re currently providing?
How likely will the audience move from one app to another if given the opportunity?
How much demand is there for a business known for one thing to get into another if there are apps already serving that need?
How easy is it to connect these multi-app experiences?
Does this strengthen gateways into the larger ecosystem or create vulnerabilities along the chain?
Before turning to Reels, let’s focus on one alternative use case: Spotify and video.
Recent estimates suggest that most Spotify subscribers are still using the service for audio-specific needs. Spotify has increased time spent with video as its leaned more into the format, and as YouTube continues to increase its own investment into the video podcasting space. Being able to upload videos to Spotify for creators allows them to continue distributing their audio-centric work on the largest audio platform globally (Spotify maintains a 35% market share) while experimenting with new formats, using those videos as marketing tools on larger content platforms like YouTube and Instagram, but still reaching the right audience with the preferred format for Spotify: audio.
If Spotify were to try and compete more directly with YouTube by launching a secondary app for video alone, although it would adhere to a behavior that will exist a decade from now, Spotify likely couldn’t make up the audience numbers in the new app compared to the original. The audience likely wouldn’t move over. There’s no real need for it. Uploading to multiple apps gets more complex if the base tech isn’t the same, and it actually creates more vulnerabilities (audience fragmentation) rather than strengthening Spotify’s empire. Building video into Spotify, therefore, is the best move because it complements Spotify’s original function and format and there’s no real opportunity outside of the app. Doubling down as strength rather than weakening the chain through expansion.
Honestly, the more I think about Reels the more I see it as a contradictory need that complements some of Instagram’s audience. But if Meta wants Instagram to be the mobile empire, separate even from Facebook, then it has to exist as the melting pot. It is not the ultimate destination for creators who want to contribute to their own preferred networks via their own preferred methods of creating. Think of it as a solar system. Threads is one planet. Reels is another. Llama could be another. Instagram is the way that these forms of entertainment and information are shared with personal connections (intimacy), but they exist as their own bubbles of content (entertainment/information).
We can see the contradictory nature that exists. We can see why Instagram executives would want to explore spinning off this app that checks off much of the aforementioned list. Having a Reels app doesn’t in any way suggest that people on Instagram will stop seeing videos from strangers and creators. It’s not like Reels as a feature are being removed, but the ultimate place for creatives and audiences looking for that specific experience — and, ideally, a much more tailored one — will shift. Reels becomes its own empire that is supported by its own ecosystem of creators (islands). I have written previously about how the future of media is explained through empires and islands.
Empires, like YouTube or Fortnite, need islands (creators) to generate enough content that the empire’s scale increases. The islands, however, are only as powerful as the empire’s support. YouTube still pays out the largest advertising revenue split to creators; Roblox has the player base and financial incentives to bring developer teams into its fold through Fortnite Creative and Unreal Engine for Fortnite. Right now, Reels is arguably working against creatives because it incentivizes content instead of connection. Reels is a dumping ground for people trying to exploit all of Instagram, not a new culture as defined by its creators. If Reels were to spin off, and new monetization opportunities were introduced, the island ecosystem looks much healthier.
The unspoken part about empires and islands is that typically digital empires become the size that they are through monopolizing one area. Google has Search. Fortnite has battle royale games. YouTube has user generated content. These empires branch out (Google now has, well, everything), Fortnite includes concerts, and YouTube is making a play for traditional TV, but it’s the main thing they’re known for that keeps the foundation of the empire steady. Other companies that try to compete ultimately fail (hence that term monopoly), and concentration for any number of things that require us looking at our phones consolidates into the hands of the few. Hell, ask people with Apple phones if they use any other payment system if Apple Pay is available. As I wrote a couple of months back when thinking about Fortnite’s foray into more user generated content:
“When analysts talk about the creator revolution, it is not necessarily that 50 million new creators will take center stage in the next decade. But as power laws continue to rule our media landscape, fewer platforms will generate significant time spent, and those planets that house individual creator networks that speak to niche interests as well as mainstream culture will reap the ultimate reward.”
Still true, but I want to reiterate some numbers from the top of this post as we close out this essay.
Facebook = ~3 billion monthly active users
Instagram = 2.7 billion monthly active users
Threads = 300 million monthly active users
Reels = 300 billion monthly views
These are all empires within their own right. Branching out Reels and Threads into their own apps, becoming their own shining suns at the center of their own solar systems powered by islands that gravitate toward specific formats, doesn’t just expand Meta’s empire. It collapses all other galaxies in the solar system. If Reels can become its own billion user app, and if Meta can create a slightly better algorithm that helps to establish a relatively recognizable norm for displaced creators and audiences, then having a secondary app is the way to go. This is a contradictory need to how Instagram has existed for years.
Reels launched within Instagram because it helped with mass adoption of a format that was already being monopolized by TikTok for Gen Z and Gen Alpha audiences. It’s much easier to start from more than 2.5 billion than it is zero. But all the jokes around Reels reiterate that it still feels out of place on Instagram. It’s a content format that some want, but not all — and while that tension isn’t impacting Instagram’s engagement metrics, the growth of Reels alongside the claustrophobic feeling of the app for creators and users suggest it might be time for Reels to split. Opportunistically, after years of lobbying, months of cozying up to Donald Trump, and a pretty clear moment to capture that displaced attention, now is also the time to strike.
There are two ways of looking at this essay. The “Threads” lesson that Instagram learned is a perfect example of islands serving empires. It’s a blueprint for so much of the media. The second lesson is that our attention for so much of what we do with our phones may soon sit in the hands of just a few people at one company. And if that doesn’t terrify you, if that doesn’t infuriate you, then I’m doing my job wrong.