The latest news from Yahoo has revealed the pitfalls of producing original content for the web. The stumbling internet giant has just reported that its video division suffered a $42 million loss in the third quarter.
The company was banking heavily on its new slate of TV shows - which included the cult comedy hit Community - to help turn its sagging fortunes.
A report from The Wrap says that Yahoo CFO Ken Goldman told this to investors during a Q3 earnings call,
"We thought long and hard about it. What we concluded is certain of our original video content, we couldn't see a way to make money over time. I'm thinking of 'Community,' I'm thinking of 'Sin City Saints' and so forth. So there, where we had spent money and had some assets on our balance sheet, we elected to write those off."
He does say that Yahoo hasn't given up on the idea of producing original programming all together.
"In thinking through that, we thought of not only what is the cost, but what is the cost to market and create the streams you need to make them successful. So we're not saying we're not going to do these at all in the future, but what we're saying is in three cases, at least, it didn't work we had hoped it would work, and we decided to move on."
The company had an initial line-up of three shows for its big foray into the online content game. Sin City Saints, Open Space, and Community. The latter was the one with the biggest buzz surrounding it.
After a critically adored but sparsely watched five season run on NBC, the show moved to Yahoo but failed to gain any significant momentum.
Chances of a season 7 are slim according to series star Joel McHale. He told Vulture back in August:
"All of our contracts were up after six years. All the actors on the show, almost without exception - their stock has risen significantly and it's out of the pay rate that is affordable to make the show. So you're not going to be able to get Alison Brie or Gillian Jacobs at a normal television salary anymore. There is just not enough money to be able to pay for the show."
