Instagram’s taken another small step towards its next evolution, with ad partners now being informed that in-stream video ad placement is no longer available as an option in the app.

As you can see in this notification, posted by @Jaketheadnerd on Twitter, Meta is letting advertisers know that they can no longer use Instagram in-stream spots, but that they can use Reels placement as an alternative for video ads on IG.

Of course, Instagram also retired the IGTV brand back in October, when it announced the broader merger of its video offerings, so it probably comes as no big surprise to see in-stream video placement also fade out. But the announcement is important, because by moving Instagram away from disruptive, in-playback ads, that then further aligns all of its video offerings into a more consolidated, scrollable stream.

Which is likely a precursor to this:

As you can see in this example, shared by app researcher Alessando Paluzzi, Instagram’s currently testing a new, full-screen feed format, which would incorporate static posts, videos, Stories and Reels into a singular content stream. When a Story appears as you scroll, it would be delineated by the frame indicators along the bottom of the UI, while video posts would play as you swipe by, much like TikTok’s presentation style.

The concept aligns with Instagram chief Adam Mosseri’s statement back in December, in which he noted that a key focus for the platform in 2022 would be the consolidation of its elements.

“We’re going to double-down on our focus on video and consolidate all of our video formats around Reels”

Reels is Meta’s fastest growing content format, and with TikTok essentially changing the game on consumption habits, Instagram’s now working to catch up, and this new, integrated feed format would definitely bring it more into line with modern user behaviors.

Which then brings us back to video ads, and the removal of in-stream placement. Instagram still has various video upload options available, even without IGTV, with users able to upload video clips up to an hour long through the post composer. But I suspect, at some stage, Instagram will look to reduce that, in order to bring all of its content more into line, and make its feed more attuned to the TikTok/Reels format.

Within that, in-stream placement will no longer be a viable option, and it could be that Instagram’s removing the option now in order to prepare for the next change, as it then won’t have advertisers relying on this option anymore.

Which also raises a question about monetization, and how Instagram creators will make as much money from their efforts if they don’t have directly attributable ads in their video clips.

Instagram already has its Creator Bonus program for Reels clips (though payment amounts are reportedly declining rapidly of late), while it’s also been encouraging creators to look to alternative funding avenues, like branded content partnerships, IG Live badges, Subscriptions and merchandise promotions.

The latter could soon become a much bigger focus – last month, Instagram announced that it would now enable all users to tag products in their IG posts, starting with users in the US.

Eventually, Instagram could create a direct affiliate stream for such links, which would enable all users to tag products, and then get paid for any purchase activity that their posts generate.

That would be a more sustainable model than propping up creators through direct funding, and with Meta looking to integrate more eCommerce processes across all of its apps, it could also link into that broader push, giving more creators more reason to tag products, which could ideally help to shift user behaviors by exposing them to more purchase links in more posts.

On another front, that could also blunt TikTok’s move into the same.

Following the lead of its Chinese variant ‘Douyin’, TikTok’s working to add in more commerce elements, with a view to helping creators earn more money from their in-app efforts.

Commerce has become Douyin’s biggest revenue stream, and it seems likely that TikTok will move in the same direction – but if Instagram can get their first, with more inclusive, accessible shopping options, both for users and creators alike, that could be another way for IG to fend off rising competition from the short-form video app.

It seems to be all part of the bigger Instagram shift, aligning everything around the Reels/TikTok format and adding in more options for creators to make money from their content.

As such, the removal of in-stream ads makes sense, and it may be the first step towards a new set of monetization options in an expanded Instagram commerce push.