Seth MacFarlane’s $2 Billion Family Guy Empire

By: Josh DeanMon Oct 13, 2008 at 5:45 PM

photograph by Jill Greenberg

Family Guy creator Seth MacFarlane nabbed a record $100 million deal with Fox and is teaching Google new ways to exploit the Web. Could this crude frat-boy cartoonist really be a model for business in the postmodern age?

Enlarge

Photo by Jill Greenberg | Clothing: Boss by Hugo Boss (henley), Joe's Jeans (pants), Jockey (T-shirt)

Enlarge

Photo by Jill Greenberg

Related Content

MacFarlane produced the Cavalcade shorts with a team of six writers. The animation is instantly recognizable as his, as is the humor. The shorts lean heavily on pop culture (say, "Fred and Barney Try to Get Into a Club," which is fairly self-explanatory); they're rude (in one, Tara Reid's grotesque belly flab talks); and of course, they're crude (a boy is told he is adopted by two parents with nipples that stick out of their chests like javelins; his name, they tell him, is not Michael Sticknipples but rather Albert Horsefeet Turdsneeze -- whereupon the boy sneezes a turd that sprouts horse feet and gallops off).

The Cavalcade shorts are also distributed in an innovative way: targeting young males where they lurk by popping up in ad windows on sites such as Maxim.com and Fandango.com (while simultaneously appearing on YouTube). "The idea is not to drive someone to a Web site but to make content available wherever the audience will be," explains Dan Goodman, president of digital at MRC.

Also unprecedented is the way MacFarlane is being paid. MRC is not Fox; it can't just write him a nine-figure check. Instead, MacFarlane's status as an equity partner in the deal entitles him to split the ad revenue with Google and MRC. Because the whole idea is new, it's hard to draw parallels to current entertainment and marketing models but, essentially, MRC provides the funding and sells the ad partnerships, MacFarlane provides the content, and Google serves as distribution outlet, providing the "broadcast" via its AdSense network. Then all three split the proceeds. It can, and will, be replicated with other content providers. Already, MRC is working with the Disney Channel's Raven-Symoné on kids-targeted programming. You could easily imagine it with, say, Rachael Ray.

Each Cavalcade short carries a single advertiser. The first 10 were bought by Burger King, and -- in yet another unprecedented move -- MacFarlane animated the company's ads for them. It's an option available to any of the sponsors if they choose to pay extra for it.

For Burger King, the appeal was obvious. "Seth's fan base intersects squarely with our audience of young men and women," says Brian Gies, vice president of marketing impact for Burger King. In other words, MacFarlane's comedy provides a very powerful and friendly connection to a very targeted audience, one that tends to get the munchies. Says Google's Levy: "We know where to find them, and we're putting the advertising in an environment they're comfortable in."

"The idea is to take the TV experience and provide it on the Web," says Alex Levy, Google's director of branded entertainment. "But brought to the people you want to reach, when, where, and how you want to reach them." For a company that likes to say it's not in the content business, that's a remarkable statement. Google, in essence, is trying to use its ad-distribution network to turn content distribution upside down. (Google calls it the Content Network.)

There's no guarantee the new model is going to stick, of course -- advertisers could decide they get as much value by just buying regular Web ads and avoid paying extra. But early returns showed viewers were responding well to the shorts. In its first days, Cavalcade was the most-watched channel on YouTube, and the videos racked up 5.5 million views across the various sites running them. And MacFarlane wins no matter what. Unlike his Family Guy characters, every horny frog and lusty princess and sarcastic talking bear created for Cavalcade is owned by him, and can be deployed for future revenue. And for all this, he has zero financial risk.

*****

A couple of years ago, MacFarlane nearly worked himself to death. He collapsed at his desk and was rushed to the hospital. He was sick, he says, and "didn't have the time to stop." So he passed out right there under the Sound of Music poster. He ended up spending, as he tells it, "a lovely afternoon at the emergency room."

"We've been behind schedule on Family Guy since day one," he explains. "In reality, you can't do a prime-time animated show in the time allotted, so that always puts a glaze of stress over the whole process." He takes a breath. "I refuse to let that control my life. I did that in my twenties. Now I insist on a balance."