×
You will be redirected back to your article in seconds

RTL Takes Control of BroadbandTV with $36 Million Investment

Media conglom, which owns FremantleMedia, plans series of investments in YouTube multichannel network company

European entertainment conglom RTL Group, which owns FremantleMedia, has invested an initial $36 million in online video company BroadbandTV giving it a 51% stake in the YouTube multichannel network.

The deal marks the latest in a flurry of investments by large media companies into YouTube MCNs. Other recent pacts of note include funding in Fullscreen by Chernin Group, Comcast Ventures and WPP; a Time Warner-led $36 million round in Maker Studios late last year; and Bertlesmann’s $6.5 million funding in StyleHaul.

BroadbandTV, founded in 2005, works with more than 7,800 independent channel partners and media companies such as Discovery Communications. In the first quarter of 2013, the number of video views on BroadbandTV’s sites grew 169% reaching 2.1 billion.

RTL’s funding is the first in a series of investments in BroadbandTV, which will remain based in Vancouver, Canada, and run as a standalone entity. Shahrzad Rafati, founder and CEO of BroadbandTV, said RTL brings a range of resources to her company, including content expertise and libraries, as well as advertising sales and operational infrastructure.

“We have an ambitious growth plan with RTL,” Rafati said. She declined to disclose the valuation of BroadbandTV. Startup raised a small angel round in 2007 and has been profitable since 2009, Rafati said.

Popular on Variety

BroadbandTV has 51 full-time employees, with about another 100 contractors around the world. With the RTL funding, the company plans to increase headcount in Vancouver and open U.S. offices, in L.A. and San Francisco, as well as a European office that will likely be in Berlin.

Following the transaction, RTL Group will appoint three members to BroadbandTV’s board. The duo said they will explore joint business opportunities in areas such as development of original content and advertising sales.

BroandbandTV “is one of the most innovative companies in the YouTube ecosystem,” Guillaume de Posch, co-CEO of RTL Group, said in a statement. “RTL Group’s track record of allowing our businesses to be run autonomously by entrepreneurs means that BroadbandTV can maintain its culture and flexibility, while benefitting from our strong investment and partnership to drive continued growth.”

Luxembourg-based RTL Group owns interests in 53 TV channels and 28 radio stations in 10 countries. FremantleMedia, its content production arm, is itself a major YouTube multichannel network provider with 135 channels currently generating 400 million video views per month.

BroadbandTV generates revenue from ads sold in its YouTube channels. Rafati would not specify what her company’s revenue-sharing agreement with YouTube is. But she said YouTube’s typical split — under which content partners receive 55% of ad revenue, and YouTube taking 45% — was established several years back, “and the model was maybe applicable five or six years ago,” she said. With the costs of bandwidth and video hosting falling, it’s “maybe not something we should have in this day and age.”

For BroadbandTV, the strategy is to sell ads via its own reps to secure higher ad rates (cost per thousand impressions, or CPM) than YouTube can. Noted Rafati, “55% of 20 bucks is very different than 55% of 8 bucks.”

SEE ALSO: Fullscreen, With Comcast and WPP Backing, to Expand Into Studio Model

More Digital

  • Bernie Sanders Trump win

    Bernie Sanders Vows to Break Up Comcast, Verizon & AT&T: 'Their Greed Must End'

    Vermont Senator and Democratic presidential candidate Bernie Sanders unveiled plans to launch publicly-funded broadband networks and break up big internet providers like Comcast, Verizon and AT&T Thursday. “Their greed must end,” the Sanders campaign wrote in its high-speed internet policy proposal. The campaign argued that high-speed internet access should be treated as a public utility, [...]

  • The Office

    Streaming Wars Heat Up Rerun Market as New Services Stock Up on Hits

    In a year in which more than 500 scripted series are on the air and new streaming services seem to debut nearly monthly, some of the biggest money being thrown around for content has gone to a handful of old TV shows, the kind that for years have hummed along evening television without much fuss. [...]

  • The Irishman

    'The Irishman' Nabs 17.1 Million U.S. Viewers on Netflix in First Five Days, per Nielsen

    Martin Scorsese’s mafia saga “The Irishman” was watched by 17.1 million unique Netflix viewers in the U.S. in the first five days of its streaming release, according to Nielsen estimates. By comparison, Sandra Bullock-starrer “Bird Box” scored nearly 26 million U.S. viewers in its first seven days of availability (Dec. 21-27, 2018) on Netflix, according [...]

  • Amazon, HBO Max, Netflix Dish on

    Amazon, HBO Max, Netflix Dish on Their International Plans

    It’s different strokes for different streaming folks as Amazon, HBO Max and Netflix lifted the lid on their international plans in London this week. Amazon said it’s not in the volume game and talked up a select number of hyper-local shows, while Netflix dished on plans to rev up non-English-language originals. The message from HBO [...]

  • NOBODY’S LOOKING

    Daniel Rezende on Netflix Brazilian Series ‘Nobody’s Looking’

    Having premiered on Netflix Nov. 22, “Nobody’s Looking” marks the first collaboration between Gullane and Netflix – their second, “Boca a Boca” is in development- and comes from a long list of new projects that the streaming giant has announced with it’s $87 Million investment in Brazilian content. The series embodies the streaming platform’s push [...]

  • Sunil Doshi

    ATF: Sunil Doshi Launches Content Development Platform All Things Small (EXCLUSIVE)

    Sunil Doshi, whose company Alliance Media & Entertainment produced 2017 Tokyo film festival title “Bioscopewala” and distributed Jafar Panahi’s 2018 film “3 Faces” in India, has launched a new content development platform at the ongoing Asian TV Forum & Market in Singapore. The Mumbai-based All Things Small (ATS) is founded by Doshi, journalists Sidin Vadukut, [...]

More From Our Brands

Access exclusive content