March 28, 2019
Sony Pictures Television March 28 announced it has merged its Sony Crackle AVOD service with Chicken Soup for the Soul Entertainment Inc., a media company producing content for all screens, to form a new AVOD joint venture branded, “Crackle Plus.”
Under the agreement, CSS Entertainment will own the majority interest in the joint venture. Additionally, SPT will receive 4 million five-year warrants to purchase Class A common stock of CSS Entertainment at various prices.
The addition of the Crackle assets is expected to more than double CSS Entertainment’s overall revenue and add meaningful pre-tax earnings.
Eric Berger, chief digital officer at Sony Pictures Television, will reportedly depart the company upon closure of the deal.
Sony and Chicken Soup will each contribute certain assets with plans to combine their 10 million viewers and content expertise. SPT’s contributions feature Crackle’s U.S. assets, including the Crackle brand, monthly active users and ad rep business.
SPT and the joint venture will also enter into a license agreement for rights to TV series and movies from the Sony Pictures Entertainment library. In addition, New Media Services, a subsidiary of Sony Electronics Inc., will provide the technology back-end services for Crackle Plus.
Ownership of Crackle’s original content library will be retained by SPT but be made available for licensing to the joint venture. CSS Entertainment plans to include six owned and operated AVOD networks (Popcornflix, Truli, Popcornflix Kids, Popcornflix Comedy, Frightpix, and Espanolflix) and SVOD platform Pivotshare.
Crackle Plus is expected to have more than 38,500 hours of programming, 90 content partnerships; 1.3 billion minutes streamed per month, and an offering of more than 100 networks, both ad-supported and subscription-based, including networks owned by Crackle Plus and third-party networks distributed via Pivotshare.
“Crackle is a valuable asset and we feel confident it will thrive and grow in this new environment with CSS Entertainment,” said Mike Hopkins, chairman of SPT, in a statement. “We were drawn to CSS Entertainment as our partner in this venture because of its aggressive, entrepreneurial approach.