What: European Media Company RTL Group adds video Youtube’s lifestyle network StyleHaul to its’ existing multi-channel network holdings for US$107 million.The deal values StyleHaul at US$151 million.
Why it matters: StyleHaul will help RTL significantly achieve additional scale in online video, specially when advertisers and media seem to be on a raced to reach younger audiences who are less attracted to traditional media. This is one of many recent transactions through which major media companies buy online video related plays.
European Media Company RTL Group has acquired video Youtube’s lifestyle network StyleHaul for US$107 million to take control of the company. The deal values StyleHaul at US$151 million.
With this acquisition, RTB aims to tap the growing trend among consumers to watch videos and listen to music on smartphones and tablet computers via platforms such as YouTube.
StyleHaul adds to RTL Group’s existing multi-channel network holdings including BroadbandTV, the fourth-largest multi-channel network on YouTube in which RTL has a majority stake since 2013, European multi-channel network DiviMove of which RTL owns a minority stake and SpotXchange of which RTL acquired a 65 percent stake for US$144 million this year.
StyleHaul is an excellent fit with our digital portfolio, complementing our recent, technology-focused acquisitions BroadbandTV and SpotXchange.
StyleHaul brings together over 5,000 content creators, who distribute their content across YouTube channels and sells advertising around those millions of audience members.It attracts 900 million views a month, , to 93.6 percent from 22.3 percent. Forty percent of the top 500 fashion and beauty channels on YouTube are part of StyleHaul. In this sense, the deal contributes to RTL achieving additional scale in online video.
While increasing its own video views organically and through acquisitions like StyleHaul, RTL Group projects a total of 40 billion video views for the full year of 2014, almost doubling the total for 2013.With 900 million views a month, StyleHaul would contribute over 10 billion views to that 2014 total.
“StyleHaul is an excellent fit with our digital portfolio, complementing our recent, technology-focused acquisitions BroadbandTV and SpotXchange,” said Anke Schäferkordt and Guillaume de Posch, co-CEOs of European TV and radio company RTL Group, in a statement.
RTL already owns 22.3% of StyleHaul and with this US$107 million acquisition brings the total to 93.6%. It will invest an additional US$20 million into the young company’s growth as part of the deal.
The battle for Millenials
Advertisers and media companies are betting heavily on popular YouTube to reach millennials, who are mostly active on online platforms and less through traditional media such as television, newspapers and magazines. Specially in times when many youngsters seek to become the next “YouTube star” and this platform seems their only way to garner more views.
Advertisers and media companies are betting heavily on popular YouTube to reach millennials, who are mostly active on online platforms and less through traditional media.
“Traditional media companies are recognizing the MCNs [multi-channel networks] attract good, large millennial audiences,” said Jim Nail, principal analyst at Forrester.”Advertisers tend to stay away from consumer-generated video, but with a Disney or an RTL behind them, all of a sudden they have more credibility.It’s reassuring to marketers you have a big traditional company overseeing [MCNs] and taking issues of viewability and fraud seriously. These big companies understand what advertisers want and expect to get out of their advertising,” Nail said.
Fueling potential flight from YouTube is a series of acquisitions of MCNs by mainstream entertainment companies. In March, Disney acquired Maker Studios for US$500 million for five and a half billion views a month, Otter Media, a venture between AT&T and the Chernin Group, bought FullScreen for US$200-300 million for four billion views a month.
Top 10 YouTube Partner Channels by Unique Viewers
The September 2014 YouTube partner data revealed that video music channel VEVO climbed back into the top position in the ranking with 41.6 million viewers. Disney/Maker Studios occupied the #2 spot with 40.7 million unique viewers, followed by Fullscreen with 36.5 million, Warner Music with 23.4 million and Machinima with 20.4 million.
|Property||Unique Viewers (000)|
|Warner Music @Youtube||23,413|
|The Orchard @Youtube||16,870|
Other Articles on the Emerging (Hispanic) online video media and marketing sector: One born every Minute: Hispanic YouTube Stars MCNs in Hot Pursuit of Brands and Are Multichannel Networks the Future of TV?