Disney has indeed bought Maker Studios, the YouTube network that generates 5.5 billion views a month, for $500 million,along with a potential $450 million in performance-based earn outs.
With more than 55,000 channels, 380 million subscribers and 5.5 billion views per month on YouTube, Maker has established itself as the top online video network for Millennials. By acquiring it Disney will gain advanced technology and business intelligence capability regarding consumers’ discovery and interaction with short-form online videos, including Disney content.
On my opinion, acquiring such a big name in short-form online video making, Disney, which is a synonymous to the best entertainment, has expanded its horizon completely. This will be mutually beneficial to both companies to generate revenues. However, it is a big amount to invest, considering they have not been doing their best in the last round of payouts. Also Disney would be completely dependent on Maker, even though they are providing incentives for performance targets, it is yet unclear if Disney will get hands on and start directly managing Maker which could use management help or just sit back and monitor the progress or somewhere in between.
Update : As for why Maker will be reporting to Disney’s CFO, Mayer said that structure will create “the best chance for each and every one of our business units to build a better presence on YouTube.”
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