ProSiebenSat.1 buys stake in US multichannel operator

Germany’s ProSieben.1 Group has acquired a 20% stake in US-based multichannel network Collective Digital Studios.

The news closely follows Disney’s deal to buy Maker Studios in a deal worth up to US$950 million and a series of other deals in the original digital video market.

ProSiebenSat.1-owned global arm Red Arrow Entertainment is paying an undisclosed amount for CDS, which operates more than 600 digital channels and claims to have more than 100 million cumulative subscribers and nearly a billion video views a month.

Its leading franchises include Epic Meal Time (above), The Annoying Orange and FreddieWong/Video Game High School.

ProSiebenSat.1 said the deal gave it “access to the rapidly growing global online video market and an impressive roster of internationally recognised talent”.

ProSiebenSat.1’s own MCN, Studio71, will work closely with CDS, with the latter’s video content appearing on Studio71 channels. Marketing will be handled in-house by SevenOne Media, and both sides will work closely on technology and business intelligence.

The deal will also mean Red Arrow, ProSieben’s global production and distribution arm, will work with CDS to invest in online talent and develop new channels. Red Arrow International will sell content coming from the ventures.

“Our partnership with CDS is a major strategic step forward for Red Arrow,” said Red Arrow Entertainment managing director Jan Frouman. “Not only will we be expanding our global digital presence in a real and meaningful way, but we will be doing it with a team who knows the space and shares our creative philosophy.”

Dr. Christian Wegner, a member of the executive board of ProSiebenSat.1 said: “Having established a leading multichannel network in the German-speaking region, we are taking the consequent next step with CDS to create a global player in what is a high-growth sector of the entertainment industry.”

“With the ProSiebenSat.1 investment, CDS has gained a strategic partner that will enable us to monetise the global reach of our content as well as tap into the Red Arrow distribution system to create additional opportunities for our creative talent,” added CDS chairman Michael Green.