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How VRV plans to build on the success of Crunchyroll: an interview with GM Michael Aragon

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In June, Ellation, the parent company of Crunchyroll, announced at E3 the launch of a new subscription video on demand (SVOD) service called VRV. Crunchyroll has proven out, if not helped define, the model for successful SVOD platforms: find a niche audience, serve them premium content, and convert them into superfans. In Crunchyroll’s case, that niche audience is anime fans.

VRV, though, will differ in that it is built around appealing to the other interests of anime fans, including gaming, comedy, and technology. This model is less proven, but VRV GM Michael Aragon, who joined Ellation from Playstation Network, is confident that offering fans content they might enjoy – rather than just content Ellation knows they enjoy – will take hold.

VRV content partners include Rooster Teeth, Seeso, Nerdist Alpha, Geek & Sundry Alpha, and VRV will also exclusively show Frederator’s premium Cartoon Hangover. VRV is expected to announce additional partners in the coming months.

With the service set to launch later this year, we spoke with Aragon about VRV, Crunchyroll, and how SVODs can stand out:

Found Remote: Why didn't Ellation just roll up VRV offerings into Crunchyroll? Why launch another venture?

Michael Aragon: We built Crunchyroll into a top 10 SVOD service with a devoted fan base by staying focused on super-serving the anime audience. Throughout the process, we learned how our audience consumes the content that they love, which was more about a lifestyle than simply a video experience. Our fans not only seek out popular new shows, but they also browse through our anime merchandise, comment on forums with friends and attend private screenings and conventions. Instead of broadening outside our core anime strategy for Crunchyroll, we decided to take what we had learned and focus on psychographics adjacent to the anime-lover audience--areas like scifi, edgy animation, and tech. VRV is our model for driving a new approach to digital media and for expanding our audience by leveraging the Crunchyroll legacy of a powerful brand and audience.

FR: VRV will offer a pretty diverse and eclectic mix of content. What's the strategy behind combining genres like anime and comedy?

Aragon: We know that the Crunchyroll community has interests that extend beyond anime and into areas like animation, games, comedy, fantasy, technology, and more. We created VRV to offer our fans a deeper and broader viewing experience, featuring the type of content they might enjoy. Because members of the fandom have other interests besides anime, VRV will serve as a discovery tool for viewers to explore premium content and connect with series that they wouldn’t have encountered without our platform.

Found Remote: There are a lot of SVOD services coming to market and there are also only so many subscriptions people are willing to put their money behind. That said, why do you think VRV will be successful?

Aragon: First and foremost, we have one of the most popular SVOD services in Crunchyroll to anchor our platform. Crunchyroll alone brings millions of paid and freemium users to the platform who watch, buy, read, blog, and socialize on a regular basis. We aren’t starting from scratch, we’re starting with a beloved brand with a lean forward audience.

Just as important, we believe in our content partners. We’ve partnered with Rooster Teeth, Seeso, Nerdist Alpha, Geek & Sundry Alpha and a host of additional partners that we will announce in the future. We will also exclusively offer Frederator’s premium Cartoon Hangover on VRV. Each of our partners also have significant and established audiences on places like YouTube or on their owned and operated services. They want VRV to be their home to create even better content for their audiences with a group of likeminded people to showcase their content. While each of our partners’ audiences are unique, they all share overlapping interests which we believe creates a great gathering place that unites all these passionate communities.

Most importantly, we’ve created VRV with the fans in mind. We are building features to harness the community and social nature of our audience. Our team is comprised of industry veterans who come from places like YouTube, Netflix, Hulu, and PlayStation, and are now catering to VRV’s exact audience. Ultimately, VRV will be the platform that superserves the fandom since viewers will be able to engage with premium content, interact with an active community and have access to their favorite content brands -- any place, any time.

FR: Having been the GM at PlayStation, what trends are you seeing in the gaming space - especially when it comes to consuming video content on these platforms outside of gameplay?

Aragon: When I worked at PlayStation I was in awe of the fact that Crunchyroll was always among the most popular and widely used apps on our platform. The anime and gaming audiences share many of the same interests and the Crunchyroll team always seemed dialed into what made this particular group of people tick. So when the Ellation team approached me about this job, I understood very clearly that we shared the same outlook and perspective on how to build something unique for this particular group of fans.

Gaming consoles have become a key platform for enjoying video content among the younger, digitally savvy demographic. Crunchyroll learned that very quickly-- our app has been available on every gaming platform since our early days. We are following a similar strategy with VRV. The target audience for VRV likely already owns a gaming console that they are using for games and video content. As we prepare for launch, we are working to make sure VRV is available on as many gaming consoles as possible, so we can reach our viewers where they are already consuming content.

FR: From the standpoint of premium and exclusive content, what will make VRV stand out? How will fans obtain more access to creators whose content they're already getting for free?

Aragon: We’ve already announced an exclusive deal with Cartoon Hangover, which is one of the most popular animation channels on YouTube. Frederator Studios founder Fred Seibert and his team are investing their talent and resources into creating new and improved versions of shows that have already made their channel successful on YouTube. Very soon we’ll be announcing several new exclusive partners that will provide standout content for VRV.

VRV really breaks through the noise by featuring multiple and varied content providers alongside each other on one platform. This offers viewers more versatile content and the chance to discover new shows. The VRV platform also gives fans a more affordable way to watch their favorite content, by allowing consumers to consolidate their subscriptions and solely pay for one bill via one platform. Moreover, since VRV is bringing technology to the table and offering a pre-existing video platform to our partners, content creators who don’t have the means to build out their own delivery methods can rely on our system.

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