Facebook Beta Tests Hotline, Its Answer To Clubhouse

Facebook, Inc. (NASDAQ: FB) is beta testing Hotline, a new app being positioned to rival Clubhouse.

Facebook, Inc. (NASDAQ:FB) is beta testing Hotline, a new app being positioned to rival Clubhouse.

What Happened: Hotline is being developed Facebook’s New Product Experimentation (NPE) team under the direction of Eric Hazzard, who joined the company in 2017 after it acquired his teen-polling app “tbh.”

While Hotline emulates Clubhouse’s Q&A format, it also includes a video component that the audio-only Clubhouse lacks and will automatically record events as they occur — Clubhouse events are not recorded.

Furthermore, Hotline will be free for any user to join, unlike Clubhouse’s invitation-only set-up, and there is no limit on the size of audiences participating in events.

Facebook ran its first Hotline test yesterday with real-estate investor Nick Huber as the inaugural guest. Facebook has not announced a timeline on when it expects to make Hotline available to the public.

Hotline is being developed separately from the live audio room offerings that Facebook has tested in its Messenger Rooms.

“With Hotline, we’re hoping to understand how interactive, live multimedia Q&As can help people learn from experts in areas like professional skills, just as it helps those experts build their businesses,” a Facebook spokesperson said. “New Product Experimentation has been testing multimedia products like CatchUp, Venue, Collab, and BARS, and we’re encouraged to see the formats continue to help people connect and build community.”

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Why It Matters: Clubhouse was launched in April 2020 as a free iPhone app that does not carry advertising. It has been downloaded by nearly 13 million users during its first year and averages 10 million weekly active users.

Clubhouse has attracted high-profile guests for its audio chats, including Facebook CEO Mark Zuckerberg and self-crowned Tesla Inc (NASDAQ:TSLA) technoking Elon Musk.

But Clubhouse has also been at the center of controversies, including censorship by the Chinese government after users raised politically taboo subjects of Hong Kong democracy protests and the status of Taiwan. A February Clubhouse chat by investor and entrepreneur Marc Andreesen was the subject of misreporting by New York Times correspondent Taylor Lorentz, who tweeted out that Andreesen used the slur “retards” to describe the denizens of Reddit’s WallStreetBets forum. After multiple sources pointed out her mistake, Lorentz acknowledged her error, but offered no apology for the severe misquoting.

Oddly, Facebook’s Hotline allows users to sign in via their Twitter Inc (NASDAQ:TWTR) account. This is strangely ironic, as Twitter reportedly sought a buyout of Clubhouse with a potential valuation of roughly $4 billion.

LinkedIn Set To Take On Clubhouse With Creator Mode: What Investors Should Know

(Hotline screenshot courtesy of Facebook)

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