Tuesday, March 25, 2014

Disney Acquires More Online Content

The mouse wants to be more hip and that means going where the millennials roam.  While Disney produces tons of content, new generations of viewers are more web focused.  So to capture that audience, Disney is acquiring Maker Studios, an online content company with substantial distribution on You Tube. 

As we know, this online millennial demographic can be very fickle.  Maker has been able to reach them with discovered talent including PewDiePie, but as Disney knows, what is in the pipeline is also important.  Also key for Disney is the synergy of such a purchase.  How will Maker Studios fit in with its broadcast, cable, and theme park businesses?  Will PewDiePie get a show on Disney XD?  This acquisition is clearly opportunistic for Disney and gets them closer inside the You Tube platform and its data, but is that where Disney really wants to be?  Could they have used their current stable of Disney talent to migrate from the cable platform to the online space without investing in the Maker business?

Yes Maker has currently proven itself as a leader in online video content and Disney sees that as a important piece of the puzzle.  In a make it or buy it world, I wonder if Disney's acquisition of Maker Studios best serves its long term interests.  Disney continues to create a large stable of new talent for its young audience base; that they could do the same in building out a stronger online base would have seemed a more preferred strategy.  Yet they have chosen to acquire and the hope is that Maker Studios talent base will bring new ideas to the Disney model and integrate well with all the businesses. 

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