A movie streaming firm that focuses on independent films launched in China on Thursday, beating rival Netflix to open its service to users in the world's second-largest economy.
To launch into the market, MUBI formed a joint venture with Hong Kong-listed Huanxi Media Group. The move will see Huanxi invest $50 million and hold 70 percent of the joint venture called MUBI China, while MUBI will hold the other 30 percent. As part of the $50 million, Hunaxi will invest $10 million directly into MUBI, taking 8 percent of the company, valuing it at $125 million.
The London-based company, which was founded in 2007, charges users $4.99 a month and focuses on providing independent films. It adds a new film each day and takes one off, so a film is available for 30 days before being replaced by another. It also sees its self as a competitor to Netflix to an extent, with the founder convinced it can challenge its U.S. rival in the film space.
"As Netflix focuses on TV, their movie selection is not that great. So we can really become the most significant platform on film globally. And if you are thinking global you are thinking China," Efe Cakarel, founder and CEO of MUBI, told CNBC by phone.
"China will overtake U.S. as the biggest film market next year but it's a difficulty country to navigate. We managed to crack this and this is why it is a big deal for the industry."