AT&T and the Chernin Group announced Tuesday they are jointly investing $500 million to create a venture to invest, acquire, and launch over-the-top streaming services to take on Netflix.
Financial terms have not been disclosed, but AT&T will offer its infrastructure and the Chernin Group, an entertainment company, will contribute its assets, including a majority stake in Crunchyroll, an anime video-on-demand service, as part of the deal. AT&T's base includes more than 110 million wireless subscribers and more than 16 million broadband households. The joint venture aims to invest in ad-supported and subscription video services.
AT&T and the Chernin Group teamed up last year in an unsuccessful bid for Hulu, which is owned by the Walt Disney Company, 21st Century Fox, and NBCUniversal. After eschewing the likes of Netflix for years, pay TV companies have taken a new stance on streaming services. Dish, for example, acquired Blockbuster back in 2011 to build its own streaming service, and in 2012, Verizon teamed up with Redbox to create an online movie subscription service. Sony also plans to launch its own streaming service this year. In contrast, Intel appears to have given up on its streaming plans, as it looks for buyers for its Internet TV unit.