The creator of the Lion King just raised $1bn for a new Netflix | City A.M.
The former Disney chairman who produced films such as The Lion King, The Little Mermaid and Aladdin has scored a total of $1bn (£772m) for his Netflix and Youtube competitor startup, in a seed funding round closed today.
Led by Jeffrey Katzenberg alongside former Hewlett Packard and Ebay chief executive Meg Whitman, the startup temporarily known as NewTV will be a mobile-only streaming service for short, Youtube length videos that hold the same high-quality production and story value as the shows on Netflix and Hulu.
The raise has been backed by most of the major film studios in Hollywood, including 21st Century Fox, Disney, Lionsgate, Metro Goldwyn Meyer and many more.
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Elsewhere, NewTV has been funded by Chinese giant Alibaba, as well as receiving strategic investment from Goldman Sachs, JP Morgan Chase, Liberty Global and Madrone Capital.
Katzenberg said the project “will access some of the best talent in entertainment”, with the startup already beginning to see some interest from potential partners.
Operating under the banner of Katzenberg’s holding company Wndrco, the platform will only stream its own television programmes, but will not produce or fund the content themselves. Shows could cost up to $6m per hour to produce and have individual episode runtimes of about 10 to 15 minutes, according to Bloomberg.
The news comes as Netflix’s share price took a nosedive last month, after the streaming giant reported a set of lacklustre quarterly results.
Read more: Netflix’s share price slumps 14 per cent after disappointing second quarter
It revealed subscriber growth over the April to June period of just 5.2m users, missing analyst expectations by around a million.
However Katzenberg seems unfazed by the comparison, and said NewTV will be a “completely different use case” to the likes of HBO and Amazon Video.
NewTV will have two subscription tiers available to users upon its launch at the end of 2019: an advertising-free plan, and a so-called advertising-light option, he said in an interview with Variety.
Featuring a range of shows from scripted drama to unscripted reality, NewTV won’t be hosting any live TV on the platform. Instead, all content will come from the production houses of its backers, under the startup’s licenced model.