Facebook is reportedly paying huge sums of money to prominent TikTok creators in a bid to lure them over to its own short-term video app, according to a Wall Street Journal report.
Instagram, which Facebook acquired in 2012, is launching Reels to compete with TikTok, which has recorded 2 billion downloads as of April according to mobile app market intelligence firm Sensor Tower.
Citing sources, the report said that “Instagram has made lucrative offers to some of TikTok’s most popular creators to use the new service, Reels…. The potential payments for some would be in the hundreds of thousands of dollars.”
Facebook is set to roll out Reels in more regions in August. It is currently available in France, Germany, Brazil, and India.
With TikTok’s potential ban in the US, Reels could offer a more stable platform for TikTok’s users. In India, where TikTok was already banned, similar video apps have seen dramatic increase in downloads.
A Facebook spokesperson told Forbes that it has “a long history of reaching out to emerging creators and working to break new stars on Instagram.”
Ahead of the Wednesday's historic congressional hearing on big tech’s dominance, TikTok CEO Kevin Mayer accused Facebook of dirty tactics.
Mayer also hit Facebook for launching copycat products, such as the Reels and another similar feature called Lasso, which he said “failed quickly.”
“At TikTok, we welcome competition. But let’s focus our energies on fair and open competition in service of our consumers, rather than maligning attacks by our competitor – namely Facebook – disguised as patriotism and designed to put an end to our very presence in the US.”
At the hearing democratic lawmakers questioned Facebook’s monopoly and anti-competitive strategies. (READ: U.S. lawmakers hit Facebook for copying, acquiring competition)
Zuckerberg denied the allegations and said the company is adapting features in the same way other platforms adapt and copy Facebook's. – Rappler.com