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Walt Disney Co. ($DIS) is now basking in the success of the "Beauty and the Beast" premiere that has already earned $170 million over the premiering weekend in just the United States, and is grossing $350 million globally. The company also ended 2016 with four blockbusters.

But that doesn't indicate that Disney isn't having serious competition. In fact, it's getting new competition, particularly in the ever-popular children's content. Some former Disney executives have teamed up with Nickelodeon to launch a new provider of children's content, Pocketwatch.

Pocketwatch's Plans

Pocketwatch has already managed to raise $6 million as part of venture funding. It is to be launched in the spring. It will start out with YouTube channels and also channels in other platforms such as where children usually hang out. Later it plans to start its own channels. There would be on-demand channels to be aired on cable as well as satellite TV. It is also considering striking deals with Hulu and Netflix ($NFLX) though it's not evident whether Netflix would actually end up becoming a competitor to Pocketwatch since it has its own children's content as well. Crucially Netflix has exclusively tied up with Disney, which gives it enviable streaming rights to movies and content from Disney, Marvel, Lucasfilm and Pixar. This move by $NFLX was unanimously approved by its investors.

Venture capital firm Third Wave Digital supplied $6 million in venture funding, while Jon Landau the movie producer, Leslie Moonves the CEO of CBS, Downey Ventures of Robert Downey Jr., and the United Talent Agency are some of the other prominent investors.

Capitalizing on Kids' Smartphone Trend

The trend among children these days is that they watch more content on Smartphones and tablets than television. According to what the Wall Street Journal quotes from an Ipsos report, American kids consume 72% of content from streaming sources rather than television. That's the audience Pocketwatch is targeting, though it will branch out to cable and satellite TV later. But right now it wants to be as popular for kids online as Nickelodeon and the Disney Channel target kids watching TV.

This certainly seems to be a winning move by Pocketwatch to make use of the opportunity at hand and even challenge giants such $DIS and Nickelodeon.

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