Machinima Lays Off 10 Percent of Staff

Second round of cuts in less than a year

A hot medium (Web video) plus a red hot category (gaming) along with plenty of funding from Google should equal big-time success and growth. So why is Machinima cutting jobs for the second time in less than a year?

It's hard to say, but according to a statement, the YouTube-centric network is shedding 10 percent of its workforce, or 22 positions, as part of an apparent growth plan. 

“In connection with Machinima's growth plan, the company is making an increased commitment to premium programming, its YouTube affiliate network and multiplatform distribution," said a Machinima statement. "As a result of an increased need for investment in these areas, Machinima is eliminating positions representing approximately 10 percent of the company's workforce equating to 22 of 206 employees. Over the next several months, Machinima will announce new programming and distribution initiatives that will advance the next phase of this strategic plan.”

Amazingly, despite how seemingly in-demand Machinima's male-oriented gaming and entertainment audience is, the company did the same thing last December, dumping 20 jobs. Perhaps this speaks to the challenging business model facing all YouTube multichannel networks.

According to Allthingsd, early this summer Machinima was seeking a much bigger funding round. And there have been many rumors of a possible Machinima sale—with companies ranging from CBS to Adweek parent company Guggenheim Digital Media supposedly kicking the tires on the startup.

The timing is somewhat unfortunate for Machinima, as the company is prepping for the big launch of Season 2 of its big hit Mortal Kombat.