Two big online video companies are coming together in a 50-50 merge that will create an even bigger online video company. The New York Times is among the outlets reporting that multi-channel network Alloy Digital and entertainment company Break Media will join forces to form a new media company, Defy Media.
Alloy and Break are natural allies, as they both target the same young demographic. Alloy does it through its brands, which include YouTube all-stars Smosh and ClevverTV, while Break has distributed a wealth of programs across its multiple verticals, which include its main YouTube channel, Screen Junkies, AWEme, and Made Man. The launch of Defy will strengthen both companies commitment to viewers ages 12-34.
The merger has the potential to be particularly fruitful for Alloy, which now has a platform beyond YouTube it can offer to its creators. As with Collective DS’ acquisition of Metacafe and Maker Studios’ purchase of Blip, Alloy’s alignment with the Break platform can offer a more enticing revenue split than YouTube’s much-discussed deal.
The deal will be finalized over the next couple of days. We don’t have word yet as to how the merger will affect the workforces of the two companies, though Variety’s article notes sources who claimed “there would be some cuts.” Both Alloy CEO Matt Diamond and Break Media CEO Keith Richman will stay on in leadership roles.
Neither Alloy nor Break have yet offered a comment on the impending transaction. We will provide any pertinent updates from the two companies as they roll in.