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CNN reportedly spends US$25m to create new media brand with YouTube star

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Major news network CNN has plans to create a new media brand with YouTube content creator Casey Neistat, following an acquisition of his social start up Beme. Together with the team and co-founder Matt Hacket, the Beme team will be joining with CNN Worldwide. According to the Wall Street Journal, sources close to the deal estimated the deal to be worth US$25 million.A spokesperson confirmed to Marketing that no name has been decided.The statement added that Neistat currently has 5.8 million subscribers on YouTube, and is known for producing daily vlogs (video logs) and resonating with younger audiences. News of the acquisition follows a recent announcement on Neistat’s channel a week ago that he would be ending his well-known vlogging series to pursue bigger ventures. He will maintain creative control over his own YouTube channel and everything on it, according to a press statement from CNN. The spokesperson said:CNN respects his raw voice and the authentic relationship he shares with this audience. It will continue to be one of the most compelling offerings on YouTube.According to a spokesperson from CNN, the new media brand funded by CNN will be dedicated to timely and topical video content “powered by bleeding edge mobile technology”. Developments are still in the making with the brand set to launch in summer 2017 next year.All 11 members from Beme’s development team will be joining CNN to help build the technology enabling the new company. It will also develop mobile video capabilities for CNN’s portfolio of digital properties. Meanwhile, YouTuber Neistat will come on board as an executive producer to build the editorial vision. Beme will be shutting its operations with effect of 31 January 2017, according to a note on its website penned by co-founder Hacket.The new company which will be approached as a start up will include co-founders of CNN’s Great Big Story Andrew Morse, EVP US Editorial and GM of CNN Digital Worldwide and Chris Berend, SVP digital video, Neistat and Hackett. Just like Great Big Story, it will operate as a separate, stand-alone business as part of the CNN Digital portfolio.“By joining forces with CNN, we’re able to give our mission more than just one, startup-budgeted shot. We are going to hunker down and create something new. To do that with the full focus it deserves, we have to say goodbye to Beme,” Beme co-founder Hackett, said in a blog post confirming the acquisition.What does this acquisition mean for CNN?In an era where TV viewership is dwindling, especially with the younger generations, we ask several players in the media and content space what an acquisition of a social media player means for CNN.Josh Gallagher, chief strategy officer, Havas Media Group, Asia Pacific said that the move from CNN is one which the industry has been keenly watching as a forecast trend over the last year.  He added Neistat is in a unique position to help CNN understand not just how to broadcast a message, but also to help facilitate a specific audience value transfer, with audiences asking a lot more of the relationship with platforms.“We have been predicting a shift from brands merely using influencers such as Casey Neistat to advocate products, as he has done in the past, but lean on them as a source of 'platform knowledge' - someone who has intimate knowledge of getting the maximum return from a platform like YouTube,” he said.Gallagher said Beme, as an app, isn't actually all that successful and Neistat is not renowned as an app entrepreneur. Moreover, he is only really famous on one platform, YouTube,"This is precisely why the move from CNN so interesting. More than the purchase of hit social technology, they are buying knowledge, and are the first to do so in an era of specialised influencers by platform,” Gallagher said, adding:CNN will now use his teams, knowledge and creativity to build out its capabilities as linear television and news reporting expand its footprint online. Agreeing with Gallagher is Clay Schouest, chief strategy officer at Carat APAC, who thinks the move is another example of a large traditional broadcaster attempting to keep pace with the shift in the way news, entertainment and information is being consumed in the digital economy. This is particularly so for younger audiences.“Like many YouTubers, Casey's style of journalism typifies what CNN has traditionally not represented – immersive, lifestyle led, authentic, short form and agile,” Schouest said.He added that one can only assume that this is CNN’s attempt to attract a younger audience which seeks this type of news content.“It doesn’t add a huge amount of overhead as there is no physical studio. It will be interesting to see how Neistat’s Snapchat potentially features as part of the deal and whether CNN will attempt to use this as a new platform for its services,” Schouest said.

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