Most people probably have no idea what 60Frames was but it was a fairly well financed website that was trying to be deliver high quality webisodes, almost like an online network. That business model failed so they tried to start becoming more of an production company focusing on online material but they've now basically gone bankrupt and belly up.

The main problem with 60frames and with most sites like it is simply: there's no reason to go back everyday. Web shows aren't, and may never be, something that people will flock to every day of the week. In order for one of these sites to really make it big, they need to be more than just a webisode gallery; they need constant news. It would be easier for a site like The Daily Beast, Ain't It Cool News, or something like that to expand into webshows since they already have an audience that check the sites out on a regular basis. ESPN tried this with Mayne Street. although that brings up the second issue.

Most of these shows just aren't very good. Most of 60Frames' content was, albeit well produced, just plain bad. It really wasn't any better than the average user submitted Funny or Die video. This is just another reason you need another focal point for your site. If you have news, gossip, editorials that draw people in, you can get by if one or all of your shows are bad. Doubling down on your shows breaking out is just a bad way to go. Also, 60Frames launched with a bunch of shows rather than just starting out with one or two and trying to really promote those shows. (Also, while I know driving traffic to the site is most important, you still have to make your stuff embeddable. If other sites can't post your stuff, it's a missed opportunity. It gets more views for the advertising and it also helps promote the site.)

Online entertainment will eventually blossom but people need to really reevaluate their business models and be willing to invest, not just money, but a lot of time and elbow grease into developing a site with constant updates and its own personality. It will be interesting to see how long it will take for someone to really get a handle on this.