Walt Disney Company is buying Maker Studios, a major supplier of video content to YouTube, for $500 million. Disney also agreed to pay as much as $450 million more if Maker Studios meets “strong” performance targets.
With Maker Studios, Disney is following DreamWorks Animation into an online video business with expanding audiences but little profit. DreamWorks bought AwesomenessTV, a smaller competitor of Maker Studios, for $33 million last year.
“Short-form online video is growing at an astonishing pace and with Maker Studios, Disney will now be at the centre of this dynamic industry with an unmatched combination of advanced technology and programming expertise and capabilities,” said Robert Iger, Disney’s chairman and chief executive officer.
With more than 55,000 channels, 380 million subscribers and 5.5 billion views a month on YouTube, Maker has established itself as one of the top online video networks for young audiences, Disney said.