At first these films were called "Quake movies," but as creators began using other games, they were dubbed "machinima" — a misspelled portmanteau of "machine" and "cinema." A small, devoted community developed around the art form.
"Back in '97, '98, there were probably 50 of us who were really serious about it and another 200 who dabbled," Hancock says.
In 2000, Hancock registered Machinima.com to be a hub for that community. People would upload videos to the site, or watch others' films made using Quake or other games such as the Sims or World of Warcraft.
As the community grew, the cost of hosting its videos increased; eventually it became too expensive for Hancock. Six years after its founding, he sold the site to an enigmatic pair of serial entrepreneurs, half-brothers Allen and Philip DeBevoise. (Hancock declines to state the purchase price.)
Before buying Machinima.com, the DeBevoises ran Creative Planet, a collection of digital tools and film industry–related web properties, including Directors Net, Editors Net and VFX Pro.
That company followed the typical boom-and-bust pattern of the first wave of the Internet: It grew very fast and then imploded, although a leaner iteration of the company still hangs on today. At one point, it ballooned to 300 employees, only to correct through many rounds of brutal layoffs. "Ultimately, it crashed and burned," one former employee says.
The DeBevoise brothers left Creative Planet in the early 2000s and purchased Machinima.com in 2006 — incidentally, the same year Google purchased YouTube.
One of the brothers' first innovations was hosting the site's videos on YouTube. It was the right decision at the right time. Not only did it significantly cut down on the server costs that had burdened the website, but it was done at a time when YouTube was hungry for content and, in 2007, just beginning to pay video creators for their work.
But as smart as the decision was, it was contentious within the machinima community.
After all, Machinima.com had been a home for that community's members. Now the website's new owners were making money from the videos, and some of their creators felt cut out of the game.
"I befriended a lot of WOW machinimators, and I watched them complain repeatedly, asking to get their videos taken down," says a blogger who covered the World of Warcraft community at the time.
Utilizing YouTube wasn't the DeBevoise brothers' only smart decision. They began to cut deals with video-game companies to advertise alongside the videos that used their games as source materials, pitching machinima videos as more exposure for the games themselves.
Today Machinima describes its content as being about not just video games but anything that appeals to men ages 13 to 34. CEO Allen DeBevoise calls them the "lost boys": Males of a certain age largely unreached by advertising. They don't watch traditional TV; they don't read magazines. They just play video games.
And Machinima's channels, with an almost infinite supply of relevant video game content, have become the place for advertisers to find them. Machinima's main channel today has 180.5 million subscribers to 5,621 channels hosting 1.3 million videos, for a total of 43.7 billion network views. That's 392 times the number who tuned in to last year's Super Bowl on CBS.
But, just as at Creative Planet, where former employees say the DeBevoise brothers lost focus buying up too many properties without a coherent vision, there is a sense that the rapid expansion of Machinima might mean the dilution of the company's winning formula.
Decisions such as offering partnership deals to loathed, view-trolling "reply girls," who earn pageviews mostly thanks to their prominently displayed cleavage, have called the company's judgment into question. Machinima also engendered controversy by signing up underage creators like AdvancedUAV, who was 12 when he partnered with the network, making him both a target for trolls and a cause for concerned adults.
Even more troubling, though, are reports about the contracts Machinima has inked with its partners.
In scores of videos posted on YouTube, the company has been accused of locking partners into contracts with no end date. It also has been accused of offering a very low, non-negotiable CPM, the amount of money paid per thousand video views. The company also has fielded complaints over its habit of using partners' YouTube accounts to "like" and "favorite" other Machinima videos, driving more traffic and views within the network.
More than anything, though, Machinima's detractors are worked up by the fact that the network has asked for rights in perpetuity to the content created by its talent.
Vacas is not the only one who has taken a public stand against the company. Dozens of creators have written blog posts or created videos complaining about the contracts — videos that often show a savvy understanding of public relations in the digital age.