After a storied few years, Machinima has found its final home — with Warner Brothers, the studio that invested a grand total of $42 million in Machinima in 2014 and again in 2015. Warner also originally passed on buying the business fewer than six months ago.
Under the leadership of Chad Gutstein, Machinima, which was the father of the “MCN” model, has been reimagined as a new-generation digital studio, producing and packaging original projects for distribution with companies like go90, Amazon Prime, The CW Network and the now-shuttered Vessel. As part of the deal, Machinima will fold into Warner Bros. Digital Networks.
With nearly $100 million in funds raised to date, and a reported price tag of $100 million valuation, Warner Brothers picked up Machinima for pennies in comparison to the high-dollar valuations of Maker Studios and Fullscreen just over a year ago. And for the investors who placed bets early in the MCN game, Machinima had a long and tired climb towards a finish line — a conundrum many in the industry attribute to the “DeBevoise” reign (Allen DeBevoise as CEO, Philip DeBevoise as President and Aaron DeBevoise as EVP of Network Programming). According to insiders, the deal, while not a massive win, was still more than investors had expected given the prior state of Machinima’s business.
But Machinima has since grown up from its “boys club” days. “Bravo to Chad [Gutstein] for getting the business to a place where it could even find an exit at this stage,” said one executive about the deal.
“Machinima is a strong gamer and fandom content and social brand with enormous reach and high engagement with audiences that play our games and are big fans of DC films and television shows,” said Craig Hunegs, President, Business and Strategy, Warner Bros. Television Group and President, Warner Bros. Digital Networks, in a statement.
That says it all. Much in the way Disney saw Maker Studios as an opportunity to acquire audience and a dedicated promotional pipeline for its own library, Warner Brothers and Machinima pose an even more obvious opportunity for collaboration.
“We’ll now be able to take full advantage of Warner Bros.’ intellectual property, sales and distribution, while still creating content for social and premium digital platforms that gamers and geeks love. Plus, we’ll be fully embedded and can help Warner Bros. continue their incredible digital marketing successes,” said Gutstein on the deal.
As the Time Warner-AT&T deal shakes out, there could be growing opportunity for Machinima to become an upper rung in the collective business for OTT inside of TW and AT&T.