- Video news startup Cheddar is being bought by cable company Altice USA for $US200 million.
- Cheddar founder and CEO Jon Steinberg will become president of the new company’s Altice News unit.
- Altice wants the financial news service for millennials to help grow its news division.
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“Post-cable” network Cheddar is joining the traditional pay-TV ranks.
The video-news startup founded in 2016 by former BuzzFeed president Jon Steinberg is being bought by telecom Altice USA for $US200 million, the companies announced on Tuesday.
Cheddar has already raised eye-popping funding, especially considering the gloom and doom surrounding digital media. When it was just two years old, it was valued at around $US160 million in March 2018 after raising $US22 million in new funding.
With Cheddar, Altice wants grow its news division by taking advantage of Cheddar’s reach with professional millennial viewers. The companies already work together; Altice’s News 12 airs Cheddar’s daily Cheddar Tech Report on its seven stations in the NY Tri-State, while i24NEWS runs top stories from Cheddar. The companies said the acquisition will provide more ways to collaborate.
Steinberg’s playbook has been to offer Cheddar for cheap or nothing to distributors in exchange for getting carried in skinny bundles and relying on advertising. As a result, Cheddar is liberally distributed on several new streaming services including Sling TV and Philo; screens on college campuses; as well as on social networks and even gas station pumps.
Cheddar has expanded to roughly 40 million pay-TV homes, the company estimated. Cheddar has around 180 employees and is on track to be profitable this year after pulling in $US27 million last year, Steinberg has said.
Despite its far-reaching distribution, Cheddar’s audience size has been hard to measure because it airs in so many places and there’s no good ratings system to measure that audience, something Steinberg himself has acknowledged.
Steinberg himself is a relentless self-promoter, and has his share of haters.
On the other hand, to fans, Cheddar has gotten strong interaction for its videos on social media. It operates with a low cost structure, and while other digital media companies chased scale, Cheddar set its sights narrowly, at the financial-news category.
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