×
You will be redirected back to your article in seconds

AT&T, Chernin Group Invest $500 Million in Over-the-Top Video Venture

AT&T and The Chernin Group announced plans to invest $500 million to create a new venture that will acquire, invest in and launch over-the-top video services.

The companies said the goal of the venture will be to invest in both ad-supported and subscription-based VOD channels as well as streaming services. The idea is to launch new Internet-video services, rather than deliver a “virtual pay-TV” service that would be designed to compete with traditional cable or satellite TV, an AT&T rep said.

As part of the pact, Chernin Group will contribute its majority stake in Crunchyroll, a subscription VOD service focused on anime content.

Additional financial terms of the deal were not been disclosed, and the companies did not announce launch timing or other details of the partnership.

AT&T and Chernin Group previously had paired up in an unsuccessful bid for Hulu last year, before Hulu’s parent companies — Disney, 21st Century Fox and NBCUniversal — decided to retain their ownership stakes. The two companies also pacted on “@SummerBreak,” a social-media reality series about teens in the L.A. area that will return this June for a second season, which features product placement for AT&T’s mobile wares.

By joining forces, the companies will have a larger pool of cash to go after new opportunities in the online video biz, execs said. However, there are no specific properties at this point AT&T and Chernin Group are seeking to acquire, according to a source familiar with the deal.

”AT&T and The Chernin Group are combining our skill sets to address the growing consumer demand for accessing content how and when they want it,” John Stankey, AT&T’s chief strategy officer, said in announcing the pact. “Combining our expertise in network infrastructure, mobile, broadband and video with The Chernin Group’s management and expertise in content, distribution and monetization models in online video creates the opportunity for us to develop a compelling offering in the OTT space.”

Peter Chernin, chairman and CEO of Chernin Group, noted that his company has been focused on investing in online video. The deal with AT&T “only further underscores our strategic commitment in this area as operators, investors and programmers,” he said in a statement. “AT&T’s massive reach on those platforms across mobile and broadband and their commitment to the online video space make them the perfect fit for this venture with us.”

The new venture will combine Chernin Group’s content assets and expertise with AT&T’s network infrastructure and marketing power. AT&T has more than 110 million wireless subscribers and more than 16 million total broadband subscribers.

Popular on Variety

More Digital

  • STRANGER THINGS

    'Stranger Things 3' Is Most-Watched Season to Date, Netflix Says

    The Upside Down delivered upside for Netflix in the third quarter: “Stranger Things” season 3 was the most-watched season of the series to date, according to the streamer. In the first four weeks of release, “Stranger Things” season 3 was watched by 64 million member households, Netflix said in the Q3 letter to shareholders. The [...]

  • Stranger Things Season 3

    Netflix Undershoots U.S. Subscriber Adds for Q3, Beats Profit Forecast

    Netflix fell slightly short of its U.S. subscriber forecast in the third quarter — and projected lower Q4 subscriber growth than Wall Street was expecting as competition looms from Apple and Disney. Still, the company reported solid gains, announcing a Q3 record for paid subscriber additions and revenue, and handily topped analyst forecasts for profit. [...]

  • Despacito Luis Fonsi Daddy Yankee

    'Despacito' Tops Vevo's Most-Watched Videos of the Past Decade Chart

    In celebration of its 10-year anniversary, Vevo today announced its Top 10 lists of the decade’s most-watched music videos. Not surprisingly, the Most-Watched Music Video accolade goes to Luis Fonsi’s “Despacito” (featuring Daddy Yankee), with 6.4 billion views since its release in early 2017. The second most-viewed video is Mark Ronson’s “Uptown Funk” (featuring Bruno [...]

  • Dead To Me

    Streaming Shows Nearly Doubled in Last Year, Boosting Los Angeles TV Production

    Television production in Los Angeles has received a major boost from streaming shows, according to a new report from the permitting organization FilmLA. The number of new digital projects nearly doubled between the 2017-18 and 2018-19 development cycles, increasing approximately 85.3% in a year. The number of digitally distributed original series in production has increased by [...]

  • Shonda Rhimes

    Shonda Rhimes Inks Podcast Deal With iHeartMedia

    Hit-making TV writer and producer Shonda Rhimes is jumping into the podcast game in a much bigger way. Rhimes’ Shondaland production company announced a three-year pact with iHeartMedia to launch Shondaland Audio, which will produce a slate of original podcasts to be released as part of the iHeartPodcast Network. Rhimes will oversee development and Sandie [...]

More From Our Brands

Access exclusive content