MCN Investment Activity Heating Up
Six months into the year, the level of
corporate development activity on YouTube-related channels has been nothing but breathtaking:
-- Bertelsmann invested in StyleHaul.
-- Time Warner invested in Maker.
-- Dreamworks acquired AwesomenessTV for $33 million guaranteed, and up to $123 million total
-- Cherning Group and Comcast invested in Fullscreen
- RTL invested in Broadband TV.
Whether or not these investments bear fruit remains to be seen. It’s clear, however, that the general multichannel network (MCN) strategy is anything but a slam-dunk.
Diversification is the Name of the Game
In fact, while YouTube remains the main game in town, many MCNs have hatched strategies to build an off-YouTube business to improve their fortunes and diversify.
All Quiet on the Western Front?
Under Ross Levinsohn's brief tenure, Yahoo made content and video a central pillar of its strategy. Yet under Marissa Mayer, the focus shifted to tech, mobile and apps. That doesn't mean Yahoo's been inactive in video: commanding a large enough video audience to matter for the foreseeable future, it remains a major producer of branded entertainment for marketers.
A Soap Opera Befitting Hollywood
After the French government kiboshed its attempt to buy DailyMotion, it submitted a bid for Hulu.
Hulu started off the year amid the mystery surrounding its fate. Six months later, we're getting ready for the season finale, as multiple bidders -- including Yahoo -- have submitted offers that the site's owners and bankers are reviewing.
YouTube Changes Tune, Sticks to What It Does Best
After an expensive experience to bring super-premium content from big brands, YouTube has come to the conclusion that TV-style content just doesn't work well with YouTube audiences. Nonetheless, it succeeded in changing (or starting to change) Hollywood's perception of YouTube, and encouraging marketers to spend more money than ever on the site.
Dawn of Fat Content Startups
It's not just MCNs that are getting funded. We have finally seen venture capitalists give in to temptation and invest in content: Business Insider ($19 million), Buzzfeed ($46 million), Cheezburger ($37 million), VOX Media ($40.5 million), Sugar Media ($46 million), BuzzMedia ($58 million) and Bleacher Report ($40.5 million) being some of the more notable ones.
While overall online video advertising keeps growing, it's not growing fast enough (especially relative to television advertising), nor are CPMs going in the right direction. In fact, with 100 hours of content being uploaded onto YouTube
every minute now and more advertising showing comfort around some UGC, the
industry is holding out for a miracle solution to make the production of
content a viable one.
Nice Robot You Have There
And as expected, we saw that some of the fraudulent shenanigans that were commonplace in search and display advertising have seeped into video advertising as well, with fake clicks beefing up inventory on Ghostown Web properties, all at the expense of advertisers.
What do you think will be the biggest stories and trends in video in the second half of the year?