Niche streamer Crunchyroll isn’t so niche anymore—and soon it may no longer be a WarnerMedia property, either.
The anime streaming service, which cleared 3 million paid subscribers and boasts 70 million registered users this summer, is reportedly in the final stages of a sale to Sony, bolstering that company’s streaming foothold. The consumer electronics giant is already the majority owner of U.S. anime streaming service Funimation.
If the sale goes through, it’ll be the latest instance of major media companies paring down, reimagining or offloading smaller services as they bolster and streamline their consumer streaming offerings. It seems clear that some small ad supported or subscription services currently in entertainment giants’ portfolios may soon change hands—or shut down entirely.
WarnerMedia’s total number of video-on-demand services has already dwindled as the company focuses on all-purpose HBO Max. In September, the company opted to sunset niche streamer DC Universe, moving original shows like Doom Patrol and Harley Quinn over to HBO Max and signaling plans to evolve DC Universe into a comic book rental subscription offering.
And at ViacomCBS, outgoing chief digital officer Marc DeBevoise told Adweek in September that some of its smaller services “will not exist in the long run.” The company is still ironing out which services will stay and which ones will go, he said at the time.
But it’s a balancing act as companies determine just how valuable those services may be on their own and whether they can convince subscribers to transition over if they do fold those targeted services into a broader offering.
“They’re all analyzing and asking, ‘Is it best for us to throw everything into one service, like an HBO Max, or have a main anchor service like a Paramount+, but also have the existence of other services around it?’” said Steve Nason, research director at consulting firm Parks Associates.
For many companies, including WarnerMedia, ViacomCBS and Disney, all-purpose streamers like HBO Max, CBS All Access (soon to be named Paramount+) or Disney+ offer a place to house multiple entertainment brands that have smaller sections within the bigger offering. That’s already lead to some casualties. Last year, Disney shut down subscription streaming service FX+ before opting to make FX programming available on Hulu as part of a branded hub.
The calculus can get more complex, though, when those brands already have loyal customer bases that may not be eager to pay for additional programming.
Take ViacomCBS’ BET+, which DeBevoise said is not going to be folded into Paramount+ or CBS All Access. While it’s the same price as All Access ($9.99 a month), it targets Black Americans.
The joint venture between BET Networks and Hollywood titan Tyler Perry cleared 1 million subscribers this summer. Folding BET+ into a big offering would mean saying goodbye to at least some of that revenue for those unwilling to stomach a higher price point. It would also mean swallowing the cost of that service’s programming and operations.
The same applies for Crunchyroll. Its 70 million registered users who watch anime for free with ads on the service would need to be convinced to pay $15 a month if WarnerMedia were to migrate that library entirely to HBO Max. That’s not exactly a winning economic proposition, especially considering the international footprint of Crunchyroll, in territories where HBO Max has yet to premiere, Nason said.
That doesn’t mean companies aren’t looking for ways to leverage targeted offerings to help bolster their all-purpose services. ViacomCBS CEO Bob Bakish has previously described the company’s broader services as “powerful traffic funnels” to more targeted offerings. And, true to form, a handful of popular BET programming like Everybody Hates Chris and Sister Sister is available to stream on CBS All Access.