How Amazon's massive TV deal with YouTube's top star turned sour

• Amazon's "Beast Games" show with YouTuber MrBeast has faced safety concerns and negative press.
• The show, announced in March, was meant to boost Amazon's video ad sales with a $5 million prize.
• Amazon insiders say the show was risky from the start with the streamer ceding control to MrBeast's team.

Amazon's upcoming reality show with YouTube's biggest star, Jimmy Donaldson (known online as MrBeast), was supposed to be a bold bet on the future of TV. But it's begun to turn into a massive headache for the tech giant.

In March, Amazon announced the show, called " Beast Games," and said it would offer a $5 million cash prize — believed to be the biggest in TV history. It seemed like a coup for Jennifer Salke, the head of Amazon MGM Studios, who needed a hit, especially as Prime Video was about to make its first big pitch to the TV ad sales community.

"We are excited to work with Jimmy and his talented team to bring his brilliant, high production, and stakes-raising concepts to 'Beast Games' for our global customers to experience," Salke said at the time. "Beast Games" was part of a celebrity-studded slate Amazon presented at its TV upfronts debut in May.

But now, a PR catastrophe around the show — and a broader reckoning around Donaldson — have raised questions about the show's advertising prospects and launch date.

Two Amazon insiders said the show faced risks from the start with Amazon agreeing to give Donaldson control over the show's creative, as well as approval over ad sponsors, as part of its effort to land the deal during a competitive bidding process.

"We really need a hit. So they just let him do whatever," one Amazon insider said. The insiders spoke with Business Insider on the condition of anonymity because they were not authorized to speak publicly about the show.

Amazon declined to comment to BI.

"Beast Games" was supposed to kick-start Amazon's video ad sales efforts with a show that was expected to attract a wide audience and advertiser appeal. Despite being a dominant spender on entertainment content, Prime Video has faced questions about its popularity with viewers. According to Nielsen's Gauge, the service accounted for 3.1% of streaming TV viewing in June, after YouTube's 9.9% and Netflix's 8.4%.

One top ad-holding company buyer briefed on Amazon's pitch for "Beast Games" earlier in the spring was impressed while describing it as expensive compared to other prominent TV show sponsorships. Amazon pitched it as a sponsorship with the chance to have products integrated into the show for advertisers spending a hefty $10 million and up.

"They're getting smart about packaging," said the buyer, who asked for anonymity to discuss private negotiations. "They're starting to act like a TV player."

The agency ultimately ended up passing, though, the buyer said.

But the positive sentiment around the show was thrown into serious question when The New York Times dropped a bombshell report in early August that centered on safety concerns around the production of "Beast Games." The Times reported that over a dozen people who participated in the show's first installment said they didn't get enough food or medical care and that some competitors were injured as a result of the physical challenges. Donaldson's camp, which is repped by crisis PR pro Matthew Hiltzik, said only a handful of people were injured and blamed a lot of execution problems on local staff in Vegas hired to handle shooting for the show.

Whatever the cause, the negative press attention couldn't have helped the show's advertising prospects. The first Amazon insider said the streamer had been close to closing deals, but that chatter within the company was that the controversy had been hampering the negotiations.

"It's going to be a mess," this person added.

A second Amazon insider said producers were already talking about making a Fyre Fest -like documentary about "Beast Games."

The controversy raises questions about what happens next for 'Beast Games'

Typically, a complicated reality show like "Beast Games" would go through careful legal vetting to identify and manage inherent risks — something Amazon's own reality-show experts who work on hits like "Shark Tank" and "Survivor" would know.

"All you do is go through worst-case scenarios and work backwards from there," the second Amazon insider said.

In this case, MrBeast's team was in control — not Amazon.

With the show in production and a lot of money on the line — Puck previously reported that Amazon had paid nearly $100 million for the show — it's hard to imagine "Beast Games" getting canceled. But Mike Hopkins, SVP of Prime Video and Amazon MGM Studios, is all over the situation, two Amazon insiders said. One added there had been discussions of pushing the as-yet-unannounced launch date to distance it from the PR fiasco.

The insiders said they also worried that the situation could give Amazon higher-ups an excuse to cut Amazon MGM Studios' budget for unscripted shows, or entertainment spending altogether, especially as live sports are becoming more costly and devouring a bigger share of media companies' content spending .

Still, Amazon is one of the biggest spenders on content these days as other media companies cut back. It's increased spending $1.7 billion to $13.6 billion on sports and entertainment content, according to Ampere Analysis . Reuters also reported that Amazon plans to more than double its theatrical releases, from six in 2024 to up to 16 in 2027.

Amazon has made a largely positive impression on advertisers overall in selling ads in Prime Video, thanks to its big ad-supported audience, large sports footprint, and prices that are competitive with other streamers. Amazon also has a broad portfolio, including Twitch and Wondery, that advertisers can use to extend their ad buys, and the ability to tie ads to sales results.

"They seem like Teflon," a third Amazon insider said, referring to the company's ability to survive controversies and the likelihood it could shrug off this latest MrBeast drama as well.