Walt Disney Co. is considering acquiring YouTube multichannel network Maker Studios for about $500 million.
People with knowledge of the discussions say the deal can help Disney reach out more to a young teen audience with interests in web-based videos, according to the Wall Street Journal.
Maker is one of YouTube's biggest content providers. Anonymous sources said that if the deal goes through, it would "value the YouTube network at $500 million or more", while other sources said the deal could reach up to $900 million if Maker succeeded in financial performance goals, Variety reported.
Maker has gained its reputation by helping channels sell advertising and make product-placement deals. The network partners clients with merchandisers and endorsements that can bring videographers to celebrity status. Maker also gets information for other companies on online-video strategy and produces videos for them, the Wall Street Journal reported.
Maker stated it serves 5.5 billion monthly views and has 380 million subscribers to 50,000 YouTube channels it owns and manages for partners. The list of channels in the network includes PewDiePie, the most-subscribed third-party channel on YouTube, which currently has almost 24.8 million followers. The list includes many other channels such as the Shaytards, KassemG, EpicLloyd's "Epic Rape Battles of History" and Snoop Lion's WestFestTV, according to Variety.
YouTube takes a huge share of advertising revenue on the website, which makes it hard for multi-channel networks to make a big profit. However, the companies offer a large amount of access to young teens and millennials. Almost 16 percent of Maker's audience using laptop or desktop computers are between 13 and 17 years old. This is almost twice as high a percentage than all video on the Internet, the Wall Street Journal reported.
Maker has a long list of investors, including Time Warner Investments, Downey Ventures, M+C, the investment company for Robert Downey Jr., and many others, Variety reported. Recent investors include Astro Overseas, Singapore telecom provider SingTel, and venture-capital firms Lakestar and Northgate Capital.
