Today’s announcement and other financial moves reportedly in the works for the gaming-oriented online service underscore how hard it is for channels to make money at YouTube. Machinima – which describes itself as “the number one global video entertainment network for young males” — says today that the layoffs, hitting 30% of the workforce, are part of its “restructuring in and around its sales organization” as it leans on its “longstanding partnership with YouTube to drive media sales.” But it also comes as it lines up $18M in funding from a group led by Warner Bros, website Re/code reports, citing “people familiar with the transaction.” Last week The Wall Street Journal reported that Warner Bros was mulling the possibility of investing as much as $15M in the online video operation. The numbers are a far cry from the amounts approaching $70M that Machinima was said to be hoping to secure last year. One of the problems for YouTube services like Machinima is that Google takes about 45% of the ad revenue it sells, as well as much of the inventory.
EXCLUSIVE: Ridley Scott and his commercials production company RSA will team with Machinima to produce 12 short films that will focus on science fiction content that might be grown into feature franchises. Machinima is the top global video entertainment network for males aged 18-34, reaching more than 2.6 billion views monthly. It is the top-rated entertainment channel on YouTube.
Despite turning 75, Scott continues to have an appetite for cutting-edge stuff and emerging technologies. He won’t direct any of these short films but will be a hands-on executive producer with RSA president Jules Daly. With Machinima, they will select directing clients of RSA and figure out what stories to tell.
Machinima has provided a strong springboard for genre content on the web. The network distributed Mortal Kombat: Legacy, which revived the moribund Mortal Kombat franchise. It started with a short film and is now in its second season and led to a feature film in development. Halo 4: Forward Unto Dawn premiered last fall and the series has received more than 3.2 million views.