American multinational conglomerate holding company AT&T Inc. is selling its anime video unit Crunchyroll for $1.18 billion to Sony. Crunchyroll will become a part of Sony Corp.’s Funimation Global Group. The deal is reportedly a part of a drive by the telecom giant to unload assets and pay the debt down. The cash transaction is subject to regulatory approvals and AT&T hopes to complete the deal as soon as possible but didn’t confirm the time frame.
The sale of Crunchyroll is part of the rebuilding process of WarnerMedia, a business AT&T acquired in 2018 in its $85 billion purchase of Time Warner. Sony and AT&T were in talks for months about the deal as reported earlier by Bloomberg. AT&T made a more than $1 billion purchase when they acquired Crunchyroll back in 2018.
Crunchyroll was founded back in 2006, it is a premier anime direct-to-consumer service with more than 3 million Subscription Video On Demand (SVOD) subscribers and growing. It serves 90 million registered users across more than 200 countries through other media and products, including mobile games and merchandise. Crunchyroll employs about 550 people, with 250 in the U.S., mostly residing in San Francisco and Los Angeles, and about 200 in Europe.
After the purchase, Sony aims to broaden distribution for Crunchyroll’s content partners and wants to work on creating new offerings for anime fans.
“We have a deep understanding of this global art form and are well-positioned to deliver outstanding content to audiences around the world,” Tony Vinciquerra, chairman and chief executive officer of Sony Pictures Entertainment, said in the statement according to Bloomberg. “Together with Crunchyroll, we will create the best possible experience for fans and greater opportunity for creators, producers, and publishers in Japan and elsewhere.”
Atsushi Osanai, a professor at Waseda Business School has opined that the deal also makes it easier for Sony to promote its music rather than just anime as the theme music of the cartoons is often created by the company’s artists.
Under WarnerMedia chief Jason Kilar, AT&T’s media operations are focusing on HBO Max as the company shocked Hollywood last week after they announced to put all of Warner Bros.’s major movies next year on HBO Max at the same time they hit theaters. AT&T hopes the $15-a-month streaming service that launched in May will compete against the big boys that are Netflix Inc. and Walt Disney Co.’s Disney+.