Facebook introduces video on Instagram

NEW YORK -- Facebook is adding video to its popular photo-sharing app Instagram, following in the heels of Twitter's growing video-sharing app, Vine.

Instagram co-founder Kevin Systrom on Thursday said users will be able to record and share 15-second clips by tapping a video icon in the app. They also can apply filters to videos to add contrast, make them black and white or different hues.

"This is the same Instagram we all know and love but it moves," he said at an event held at Facebook's Menlo Park, Calif., headquarters.

Vine, which launched in January, has 13 million users and lets people create and share 6-second video clips. Instagram has more than 130 million users, up from about 22 million when Facebook bought the company more than a year ago. If users like it, Facebook's move could propel mobile video sharing into the mainstream. Systrom said

To use the video feature, Instagram users who've downloaded the latest version can tap on the same camera icon they use to snap photos. A new video camera icon will appear on the right side. Tap it and a screen with a red video button will let you record clips of sunsets, children running in parks or co-workers staring at their computer screens.

The app will record as long as your finger is on the red button or for 15 seconds, whichever comes first. Not unlike Vine, taking your finger off the button will stop the recording, allowing you to shoot the scene from a different angle or record something else altogether. Once you have 15 seconds of footage, you can play it from the beginning and post it on Instagram to share with others.

A feature called "cinema" adds stabilization to the videos so they don't look like shaky amateur shots. Systrom called it "completely mind-blowing." Right now, only owners of the iPhone 4S or iPhone 5 can shoot video using this feature.

Given Vine's popularity, "it is perhaps more surprising that Facebook has not introduced video for Instagram sooner. There is no doubt Twitter will move quickly to up the ante on Vine and this could undercut Facebook's efforts with video on Instagram," said Eden Zoller, principal consumer analyst at Ovum, a technology research firm, in an email.

Forrester Research analyst Nate Elliott thinks taking features from smaller rivals and offering them to a much larger set of users "has worked well for Facebook" so far.

"It also keeps Facebook's services fresh, and is one of the reasons more than a billion people still use the site every month," he wrote in an email.

When Facebook Inc. agreed to buy Instagram in April 2012, it offered $1 billion in cash and stock. But the value of the deal fell to $715 million by the time the deal closed last August.

Instagram was the first -- and only -- company Facebook has bought and kept running as a separate application. Until its Instagram purchase, Facebook was known for smaller "acqui-hires," a type of popular Silicon Valley deal in which a company purchases a startup as a way to hire its talented workers and then shuts down the acquired company.

Facebook still hasn't said how it will be able to make money from Instagram, as it has not introduced ads on the service.

Online video ads are growing, and it's likely only a matter of time before they arrive on Facebook -- and at some point, Instagram. Research firm eMarketer estimates the U.S. digital video advertising market will grow 41 percent this year, to $4.1 billion from 2.9 billion in 2012. The mobile video ad market is much smaller, though eMarketer expects it to more than double this year to $518 million.