Disney, YouTube Strike a Video Deal

disney-youtubeWalt Disney Company and YouTube are partnering together to help gain Web dominance by spending a combined $10 million to $15 million on original video series to help engage children online. This new channel is set to launch in 2012. Disney Interactive Media and Google officially announced their plan yesterday via a press release.

This move comes as Disney is losing their footing with younger children who are running to sites like YouTube to watch videos. Disney Interactive Media Group has consistently reported operating losses over the past years, with more than $300 million in the last four quarters alone. Under heavy pressure from investors, Disney is always looking for new ways to make money online.

Disney is currently working on an overhaul of its website to rebrand itself more toward children looking for video online. Striking up a deal with YouTube will help them go fishing for youngsters who view YouTube as a much more hip and cooler website.

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

Google, in addition to the deal with Disney, has reached deals with Jay-Z, The Wall Street Journal, and several other personalities and brands to create around 100 new “channels” on their popular video sharing site. All of this content will be original, high quality, and exclusive to YouTube and it’s partners. YouTube is allocating up to $5 million dollars per channel for production costs.

“It’s an acknowledgment that we want to work with the best brands and, yes, we expect this partnership to attract new advertisers,” said Robert Kyncl, YouTube’s global head for content partnerships. In the new race to become the number one content provider in the world, Google should be able to attract new advertisers while getting a lot more youngster customers engaged online.

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