Sony’s streaming service Crackle sells majority stake to Chicken Soup for the Soul

NelsonG · March 29, 2019

Crackle sells to Chicken Soup for the Soul. That’s not an early April Fools’ joke, but rather the news that Sony’s aging streaming service Crackle has now found a new home with Chicken Soup for the Soul Entertainment, or CSS Entertainment — the same company that today runs the streaming service Popcornflix and other streaming channels. (And yes, is also behind the well-known book series.)

The news was first reported by Variety, and further detailed in a press release issued this morning.

CSS Entertainment will now be the majority shareholder in the new joint venture, rebranded as “Crackle Plus.” (Sony hasn’t entirely departed.) Sony, meanwhile, will receive 4 million five-year warrants to purchase Class A common stock of CSS Entertainment, Variety’s report says.

Sony first acquired Crackle in 2006, making it one of the older free, ad-supported streaming services on the market. However, it has struggled to grow amid competition from sites like Netflix and the billions it and others — like Hulu, Amazon and now Apple — are investing in original content. That led Sony to announce last year it would seek new strategic partners to help it run Crackle.

The transfer of ownership for Crackle, however, arrives at a time when ad-free streaming services like this are seeing newfound interest, with Amazon’s launch of IMDb’s FreeDive, Roku’s The Roku Channel, Walmart’s Vudu, Viacom’s new addition Pluto, Tubi and others now making gains.

As part of the deal, Sony will contribute to the new venture its U.S. assets, including the Crackle brand, user base and ad rep business, according to The Hollywood Reporter. It also will license to Crackle Plus movies and TV shows from the Sony Pictures Entertainment library, as well as Crackle’s original programming, like its shows “Start Up” and “The Oath,” for example.

CSS Entertainment will bring six of its ad-supported networks — including Popcornflix, Popcornflix Kids, Popcornflix Comedy, Frightpix, Espanolflix and Truli, plus its subscription service Pivotshare — to Crackle Plus.

The combination will lead Crackle Plus to become one of the largest ad-supported video-on-demand platforms in the U.S., the companies claim, with nearly 10 million monthly active users and 26 million registered users. The new service will also have access to more than 38,000 combined hours of programming, more than 90 content partnerships and more than 100 networks.

“Our joint venture will position Crackle Plus as a leading AVOD streaming platform with nearly 10 million active users on our owned-and-operated networks. This will result in a manyfold increase in our recurring revenue from online networks,” said CSS Entertainment Chairman and CEO William J. Rouhana, Jr., in a statement. “We plan to build Crackle Plus aggressively and profitably through organic growth and acquisitions.”

Current Crackle GM and Sony chief digital officer Eric Berger will exit Crackle when the deal closes.