Disney Snags Leading YouTube Network for $500 Million

Disney Snags Leading YouTube Network for $500 Million
Image credit: Maker Studios, Inc.

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Disney is adding a sizzling new entity to its magic kingdom: a leading network on YouTube.

In a $500 million deal that validates the mainstream influence of homespun content creation, Disney has signed on to purchase Maker Studios -- one of the biggest networks on the Google-owned, video-sharing site.

All told, Disney could cough up an additional $450 million to Maker if the network reaches certain growth milestones by the time the deal closes in Disney’s third fiscal quarter, reports The New York Times.

Five-year-old Maker operates thousands of channels on YouTube that attract roughly 4.5 billion monthly views and count more than 340 million total subscribers, the company said.

Related: Calling All Dreamers: Disney Is Launching a Startup Accelerator Program

Featured content includes PewDiePie, a Swedish gamer who operates the most-subscribed channel on all of YouTube, as well as Epic Rap Battles of History, a video series that pits famous figures -- such as Mozart versus Skrillex, for instance -- against one another in a comedic showdown.

Other Maker creators include the green-lipped comedienne GloZell and KassemG, famed for his on-the-street interviews.

The acquisition also represents a lifejacket toss to Disney’s fledgling video game and digital media subsidiary, which cut 700 jobs worldwide earlier this month.

Related: Google's Most Senior Female Executive Tapped to Run YouTube

While Maker will not be absorbed into this division, it provides Disney access to the billions of young viewers who increasingly consider YouTube a de facto entertainment medium. Instead, Maker will report directly to Disney’s CFO, James Rasulo, according to The Times.

Prior to its purchase, Maker Studios had garnered roughly $66 million in funding from Time Warner Investments, Greycroft Partners, Upfront Ventures and more, according to CrunchBase.

And Disney isn’t the only media giant dipping its toes into the YouTube pond. Last May, Dreamworks purchased AwesomenessTV, a multi-channel network aimed at tweens, for a reported $33 million in cash. However, the deal could reach $117 million if projected traffic goals are met.

Related: 5 Magical Tips Walt Disney Can Teach Entrepreneurs About Marketing

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