Once seen as a latecomer trying to copy TikTok’s viral success, Instagram’s Reels has evolved into a major force in digital video—and now stands as a $50 billion business for Meta. What began as a defensive move to counter the rise of short-form video has transformed into a powerful engine for user engagement, creator growth, and ad revenue. Reels launched in 2020 as a direct response to TikTok’s explosive popularity. At the time, Meta faced mounting pressure to retain younger users who were increasingly migrating to the Chinese platform. By integrating Reels into Instagram and later into Facebook, Meta aimed to offer a similar experience—quick, entertaining, algorithm-driven videos—while leveraging its massive existing user base. The strategy paid off. Reels quickly gained traction, especially among Gen Z and younger millennials. Its algorithm, designed to surface content based on user preferences rather than follower count, helped new creators go viral overnight. This democratization of visibility attracted a diverse pool of talent, from dancers and comedians to educators and small business owners. As usage grew, so did advertising interest. Advertisers were drawn to Reels’ high engagement rates and immersive format. Unlike traditional static ads, Reels allow brands to blend into the feed naturally—using trending audio, effects, and creative tools. Meta began offering targeted ad placements within Reels, and by 2023, Reels ads were generating billions in revenue annually. What’s more, Meta has invested heavily in tools and incentives to grow the Reels ecosystem. The company launched the Reels Play Bonus program, paying creators for top-performing videos. It also expanded access to analytics, monetization features, and collaboration tools, making Reels a viable career path for many. Today, Reels is not just a feature—it’s a core pillar of Meta’s strategy. The platform now drives significant time-on-app, helping Meta retain users and reduce churn. With over 1 billion daily active users engaging with Reels, the feature has become a key driver of Meta’s overall ad revenue. Now, Meta is pushing Reels beyond social media. The company is exploring ways to turn Reels into a full-fledged video entertainment platform. There are early signs of this ambition: Meta has begun testing longer-form content, experimenting with original programming, and even acquiring production studios. The goal is to position Reels as a destination for daily video consumption—akin to television. While challenges remain—such as content quality, competition from YouTube and TikTok, and the need for consistent original programming—Reels’ rapid growth suggests it’s well on its way. If Meta can successfully scale its content strategy and build a loyal audience for longer, serialized video, Reels could one day become more than just a social media feature. It could become a true competitor to traditional TV.