WarnerMedia is looking to offload the anime-focused Crunchyroll streaming service, and Sony is among the interested buyers, according to a source familiar with the discussions.
The 14-year-old service surpassed 3 million subscribers at the end of July, up from 2 million at the end of 2018. That’s about the same number of retail subscribers as the 2-month-old HBO Max of WarnerMedia drew.
But despite Crunchyroll’s relative success for a niche streamer, WarnerMedia’s parent company AT&T has sought to reduce its debt. As such, the source claims that the new head of WarnerMedia, Jason Kilar, is keen to sell any assets that are not essential to the entertainment company’s business.
WarnerMedia’s streaming bet was placed on HBO Max, which launched in late May to offer a large catalog of programming from the company’s networks and studios. Crunchyroll has a branded sticker on the app, where it hosts a selection of anime shows, but has also remained a stand-alone subscription service. In a recent interview with DeadlineManaging Director Joanne Waage said “the goal is to power both” services.
A deal for Crunchyroll would add to Sony’s existing Funimation anime business, but the source says Sony’s bid is less than what WarnerMedia was hoping to get for the company. L’information, who first reported on the sales talks, said WarnerMedia’s asking price for Crunchyroll was $ 1.5 billion.
Representatives for Otter Media, the WarnerMedia division that houses Crunchyroll, and Sony declined to comment.
Kilar, who previously ran Hulu and Vessel, a short-lived video company, quickly took over WarnerMedia after joining the company in May. In early June, reports revealed that the company was looking to sell the Warner Bros. gaming unit. Interactive Entertainment. Then, on Friday, he announced a sweeping reorganization that included the ousting of entertainment executives Bob Greenblatt and Kevin Reilly and created a new division led by Ann Sarnoff that encompasses both its studios and networks. (In his memo to staff, Kilar said the game unit would be part of the Studios and Networks group but did not comment on a potential sale.)
In an interview with THR, Kilar said the changes to WarnerMedia reflect its plan to make it a consumer-oriented operation with a focus on its streaming and global businesses. “It became pretty clear that we needed to have a single content organization to make it easier for us to make decisions to give the green light to the best possible stories that we could then convey more and more directly to consumers,” a- he declared.