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Austin, Texas-based web animation studio Rooster Teeth, owned by Warner Bros. Discovery, is closing after 21 years. General Manager Jordan Levin announced the studio’s closure at a general meeting and in an accompanying letter on Wednesday, March 6.
With the closure, approximately 150 full-time Rooster Teeth employees will be laid off, in addition to dozens of freelancers and contractors.
In his letter, available in full at the end of this article, Levin wrote:
It is with a heavy heart that I announce that Rooster Teeth will close due to the challenges facing digital media as a result of fundamental changes in consumer behavior and monetization across platforms, advertising and sponsorship.
Rooster Teeth had been operating at a loss for years. In October 2023, Rooster Teeth showrunner Kerry Shawcross posted a video explaining how changes in online advertising revenue on YouTube, a vital platform for Rooster Teeth programming, have caused the company to suffer financially.
As you may have heard, we’re changing things up a bit here at Rooster Teeth. These changes are intended to ensure that we can continue creating the content you know and love, as well as new and future projects. Your support means a lot to us and we are very grateful to have… pic.twitter.com/jGyycDZob4
– RoosterTeeth (@RoosterTeeth) October 5, 2023
To stop the bleeding, Rooster Teeth removed a significant portion of its most popular content from Youtube and made it exclusive to the Rooster Teeth website, where advertising revenue would go directly to the studio instead of the hosting platform. That measure appears to have been ineffective or too late to have had a significant impact.
Rooster Teeth was founded in 2003 by Burnie Burns, Matt Hullum, Geoff Ramsey, Jason Saldaña, Gus Sorola and Joel Heyman and had its first hit right out of the gate with Red versus blue.
One of the longest running web series in history. Red vs. Blue is found in aura video game universe and stands out as one of the first and most successful examples of machinima, in which animated content is created through a video game engine. The series was visually limited in its early days, but gained popularity thanks to its fun, witty characters and innovative storytelling.
Ownership of Rooster Teeth changed hands several times over the years and eventually became part of the Warnermedia catalog after AT&T purchased that company in 2018. Reports have indicated that WBD has been attempting to sell Rooster Teeth for some time, but could not find a buyer. The parent company still hopes to sell parts of Rooster Teeth’s catalog, including Red versus blue and other popular web series like RWBY and Gen: Block.
In a statement, Warner Bros. Discovery said:
Warner Bros. Discovery thanks Rooster Teeth’s innovative creators and partners and strong management team for its many years of success. Your passionate and loyal followers are testament to your achievements.
Although the label will be closing, Roost Podcast Network, which distributes more than 80 podcasts, will continue operations while WBD searches for a buyer for that service.
Here is Levin’s letter to the Rooster Teeth staff:
Dear Rooster Teeth,
Since our founders created and uploaded their first video to the World Wide Web in 2003, Rooster Teeth has been a source of creativity, laughter and lasting innovation in the wildly volatile media industry.
We’ve read the headlines about layoffs and closures across the industry, and you’ve heard me give my perspective and updates on the rapidly changing state of media and entertainment during each of our monthly All Hands meetings.
Since inheriting ownership and control of Rooster Teeth from AT&T following the TimeWarner acquisition, Warner Bros. Discovery has continued its investment in our company, content and community. Now, however, it is with a heavy heart that I announce that Rooster Teeth will close due to the challenges facing digital media as a result of fundamental changes in consumer behavior and monetization across platforms, advertising and sponsorship.
Please note that the Roost team is not currently affected by this action. Roost Podcast Network will continue to operate and meet its obligations while WBD evaluates outside interest in acquiring this growing asset.
In the coming days and weeks, we will have many questions to answer and the opportunity to work together to implement the best way to reduce things for us and our community. We are working on what comes next in real time and will be as open, direct and accessible as possible. Thank you all in advance for your patience and mutual support.
Let’s take a moment to celebrate our 21-year contribution to the zeitgeist, driving creativity and surpassing many of our peers since the early days of online video and digital content.
TO A CREATIVE LEGACY
From a garage in Buda, TX, to global screens large and small, our teams of dreamers and entrepreneurs have introduced and developed what made Rooster Teeth stand out: animation, comedy and games. From new forms of machinima-animated comedy to countless viral memes, including Immortal Snail (aka Snail Assassin), to an American-born animated series adopted by Japan as anime and record-breaking (at the time) crowdfunded films. . You have achieved a lot and made dreams come true here. You’ve turned original intellectual property into video games, comics, and VTubers. You have directed short videos, mo-caps and films. He has been a puppeteer, a podcast host, and has built a thriving community that spans the world. Your creativity has no limits and you will continue to contribute significantly to culture wherever your path takes you.
TO THOSE WHO ARRIVED FIRST
Despite passing through many corporate owners, Rooster Teeth transcended a media business and was a dynamic movement that shaped the bond between communities, creators and storytelling. Our founders didn’t have a plan for a media empire, but they came close to building one along with a community that fueled its remarkable growth. In its early days, RT relied on community sponsorship through time, money, and unwavering passion. Volunteers evolved into staff and the snowball effect grew, resulting in new relationships, marriages, births, and shared life-changing experiences.
TO THE CREATION OF PIONEERING CONTENT
Our approach to creating content on emerging platforms paved the way for new media models. We inspire generations of creators through streaming, machinima, animation, let’s play, merch releases, touring, podcasting and more. Companies like GameStop, YouTube, Facebook, Spotify and TikTok asked us to collaborate with them early on because we set a standard for what a digital brand could be. We boldly take our content beyond screens and into community-driven experiences.
TO AN INDUSTRY IN CHANGE
Each story reaches its final pages. The closure of Rooster Teeth is not simply an end; reflects broader business dynamics. Changes in monetization, platform algorithms, advertising challenges, and the ebb and flow of sponsorship – all of these converging factors have led to many closures in the industry. As we learn about programming updates day by day, we will soon share our plans for programs, franchises, partnerships and products and share those updates with teams internally and with the community on RoosterTeeth.com.
TO OUR FINAL SEASON
Although unintentional, it is fitting that our final season of “Red vs. Blue” coincides with us navigating this closure together. Our legacy is not just a collection of content, but a story of pixels etched into our screens, minds and hearts. Rooster Teeth has left an indelible mark on the media industry and we should be very proud of the countless ways we pioneered a business that connects creators and content with a dedicated community.
With respect, gratitude and sincere appreciation,
Jordan Levin