‘Lion King’ creator’s Youtube rival backed by ITV and Hollywood
ITV HAS chipped in alongside all the major Hollywood studios to back the former Disney executive behind the Lion King in a new streaming venture that aims to challenge Youtube and Netflix with quality programming especially for smartphones.
Jeffrey Katzenberg, who led an early Nineties renaissance at Disney before going on to co-found Dreamworks, the maker of Shrek, has raised $1bn (£772m) to fund the start-up.
Given the working title “NEWTV”, the venture is owned by Mr Katzenberg’s new holding company Wndrco and led by Meg Whitman, the former Hewlett-packard chief executive and Republican nominee for the Governorship of California.
The pair aim to commission programmes from top producers of about 10 minutes in length to suit smartphone viewing and “busy, on-the-go lifestyles”.
As well as ITV and all six of Hollywood’s production powerhouses, there is British backing from Entertainment One, the producer of Peppa Pig.
Liberty Global, the New York-listed owner of cable operator Virgin Media, is present on an investor roster led by Madrone Capital, a Silicon Valley backer of technology start-ups including the popular cycling app Strava.
Goldman Sachs, Jpmorgan and the Chinese digital giant Alibaba also joined the first funding round for a venture that it was claimed will bring together “the best of Silicon Valley and Hollywood”.
Until relatively recently California’s technology and entertainment industries viewed each other mostly with suspicion, in part because of clashes over online piracy.
The success of Netflix in bridging the cultural divide and increasing the willingness of consumers to pay for digital content has encouraged more collaboration. Apple, Google and Amazon are all now embedded in Hollywood.
NEWTV will be viewed as a particular challenge to Youtube, which dominates the market for short-form video on mobiles. NEWTV will attempt to build a large subscription business around demand for such material, a goal that has so far eluded Google-owned Youtube despite many attempts. Only around a tenth of Netflix viewing takes place on a smartphone.
ITV, which is due to sit on the advisory board of NEWTV and hold an equity stake, said the investment was in line with chief executive Carolyn Mccall’s recent strategy refresh.