YouTube and Disney Spending $10-$15 Million To Create An Original Video Series

Posted Nov 7, 2011

Google Inc. (NASDAQ:GOOG) subsidiary YouTube and The Walt Disney Company (NYSE:DIS) is spending $10-$15 million to create an original video series according to The New York Times. The video shorts will be produced by Disney and it will be distributed on a co-branded channel on and YouTube. Disney will benefit from getting web traffic from YouTube. The original video content will benefit YouTube because they are competing against websites that specialize in premium video content. YouTube depends heavily on user-generated content for its popularity.

?It?s imperative to go where our audience is,? stated Disney Interactive co-president James A. Pitaro. Pitaro added that the partnership is to ?bring Disney?s legacy of storytelling to a new generation of families and Disney enthusiasts on the platforms they prefer.?

Disney Interactive has lost $300 million over the last four quarters so that division is pressured to create web videos that can make money quickly. traffic has been dropping at a significant rate as well. In September, Disney reported 12.7 million visitors which is down from 17.9 million in June (comScore).

?It?s an acknowledgment that we want to work with the best brands and, yes, we expect this partnership to attract new advertisers,? stated YouTube global head for content partnerships Robert Kyncl.

The first in the web series will be based on the popular puzzle application called “Where’s My Water?” that features an alligator named Swampy. The goal is to have about 8 original series videos in production at any given time. Disney will be selling advertising inventory and will split the revenue with YouTube. Disney TV shows will also be featured on the channel.

Pitaro joined Disney last October after working at Yahoo! He has been spearheading the deal with YouTube and was responsible for the redesign of The redesign is expected to be complete by the autumn of 2012.