Walt Disney Co. is reportedly eyeing the acquisition of Maker Studios, a developer and publisher of YouTube (News - Alert) videos. The House of Mouse could pay a half-billion dollars or more for the company.
Maker has created a multichannel YouTube network with 350 million subscribers and works with several popular YouTube channels and content creators, including viral video stars like PewDiePie and Toby Turner. It partners with a variety of celebrity and music personalities to create original content—most recently, it signed a deal to manage the YouTube channel of Jackass comedian Steve-O and agreed to launch a video platform with the Black Eyed Peas’ Will.i.am. It also works with companies like Just for Laughs to create funny clips geared at going viral.
Overall, Maker is one of the most popular channels on YouTube, drawing some 5.5 billion views monthly. It’s the No. 4 video partner for the site (behind VEVO, ZEFR and Fullscreen).
Tech blog Re/code broke the story, citing anonymous sources. It pointed out that if the deal goes through, it would be one of the largest investments in a YouTube developer by a traditional media giant. The next-closest came last May, when DreamWorks Animation paid $33 million for AwesomenessTV, a tween-focused YouTube network (the overall payout could reach $117 million).
Google (News - Alert) owns Maker and has attracted ongoing investment, including from Time Warner’s venture arm, which led a $36 million round in the company in 2012. To date, it has raised some $70 million in financing.
Google needs strong YouTube Channels—Maker, as one of the main video view generators for the search giant, is therefore a linchpin for garnering advertising dollars. But Google walks a fine line: reports have intimated that content creators for YouTube feel that the money-making opportunities are limited by low CPMs for Web advertising and unfavorable revenue shares. And that is driving many to seek diversified revenue streams. Maker, for instance, recently signed an integration deal with Pepsi.
Having Disney (News - Alert) as a corporate parent would certainly help with that endeavor.
Edited by Rory J. Thompson
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