The Meerkat that we know (or hardly ever got to know) is dead. A few months ago, CEO Ben Rubin admitted to investors that Meerkat as a live-streaming service has failed, and it’s time for them to go in a different direction. Many startups don’t end up succeeding, but how did Meerkat fall so hard after getting off to such a promising start?
Strength of Competition
Meerkat had both the blessing and the curse of being the first major player in the livestreaming app industry. Unfortunately, they only had a month of uninterrupted success before Periscope joined in, backed by Twitter. Periscope was exposed to a much larger audience on Twitter, allowing them to double in total broadcasts and surpass 100 million. Meanwhile, Meerkat never stood a chance, and was cut off by Twitter to suffer from a lack of exposure.
Seeing the potential for livestreaming, Facebook quickly went all-in on Facebook Live, and now Google is planning to release the Youtube Connect app for live video. It’s hard for a small startup to compete with bigger and richer competitors, so it’s no wonder Rubin saw the writing on the wall just six months after launch.
The Weak Market
Despite a whole market available to them, Meerkat learned the hard way that “Mobile broadcast video hasn’t quite exploded as quickly” as they’d hoped. A report by research firm eMarketer found that only 20% of U.S. internet users were interested in trying livestreaming services like Meerkat and Periscope. Even as the app was elevated during the 2015 SXSW, Meerkat never charted very high on app store rankings, tapping out at 140 in the U.S., and almost never cracking the top 1,500 after May 2015. It seemed that for all the interesting innovation, no one really cared for live video.
The problem wasn’t finding an audience for Meerkat, as the app’s viewership was still growing, but instead lay in the difficulty to retain broadcasters with any consistency. They couldn’t retain any of their users, and once the initial excitement behind livestreaming wore off, users moved on and dismissed it as a fad. For a product reliant on user-based content, a lack of willingness of their audience to contribute would be its doom. The CEO blames it on the lack of understanding toward the live video format:
“It’s different than sharing photographs — think of it this way: before Instagram, people already knew what constituted a beautiful photo and tried to take them. With live video no one really knows what ‘good’ live video they can create is.”
No Brand Usage
The app didn’t last long enough to get into advertising, but the debut of Periscope eliminated any chance Meerkat had of establishing relationships with brands once Twitter cut them off. In March 2015, 5% of the top brands on Twitter were on Meerkat, but by November, that percentage dropped to 0%, while Periscope jumped to 15%.
Despite these numbers, Meerkat was much better equipped for branding purposes than Periscope has ever been. As part of their platform, users, advertisers, and brands could broadcast with their viewers using the Cameo feature, they could save their streams to a library, broadcasts could be scheduled in advance, and end-of-broadcast CTA’s were customizable. It seemed that they were in a great place to attract brands onto their platform and bring in ad revenue, but their reliance on Facebook and Twitter integration ultimately sunk them when both launched their own live video services.
Meerkat should be a cautionary tale for future live-streaming apps–they looked like pioneers of a brand new streaming world, before being undone by rivals they couldn’t hope to compete against. While Facebook, Twitter, and Google can support burgeoning apps as they look to find a stable user base, it shouldn’t be ignored how volatile the state of the live video market truly is. Like social media, it is a platform largely supported by user contribution, but if no one contributes, it won’t matter who is funding the venture. Does live video cross a line that people are just not willing to cross, or will it just take the time that Meerkat never really had?
The company has not given up on livestreaming, but they are shifting their attention toward social media. Businesses change and evolve to stay afloat all the time. Myspace is the classic example of a social media network that utterly failed, but was able to rise from the ashes and transform itself into a music-sharing platform instead. Meerkat failed in their initial endeavor for a lot of reasons, but they seem to have changed course just in the nick of time.