Verizon CEO Lowell McAdam confirmed the company’s plans to launch an over-the-top streaming service later this year, according to a report from Variety, citing remarks the CEO made at a telecom conference in Boston this week. Verizon (which owns TechCrunch parent company AOL), will use the combined platform of AOL and Yahoo – and their 1.3 billion users – to test the new platform, McAdam said.
The company expects to close on its acquisition of Yahoo mid-June, so the over-the-top service could arrive any time after that.
McAdam’s statements largely confirms an earlier report from Bloomberg which disclosed Verizon’s plans to enter the over-the-top live TV market with a package of dozens of channels to be sold separately from its FiOS home TV offering.
The service will also be separate from Verizon’s existing streaming video product go90, which has been struggling to succeed as an entertainment business.
The go90 service has been declared dead by at least one industry analyst; its unit saw large layoffs at the beginning of the year, and the product has been rebooted. Despite the hype building up to its launch back in fall 2015, go90 has not been able to pull in the user numbers it needs to be a viable property, nor has it produced original video hits that could get it on the map alongside the industry’s big names, like Netflix, Hulu and Amazon.
Verizon has to decide if it’s worth sinking more money into making go90 work, at this point, or scrap it.
But the interesting thing about Verizon entering the over-the-top market with its own live TV service is that it could become a home to go90’s original video output, if the company did want to shut down the go90 app. That is, instead of trying to make go90 a brand that can stand on its own, Verizon – if it was smart – could use the content that’s languishing over in that app, unviewed, to flesh out its live TV offering.
That would give the company an advantage in a crowded market of streaming TV rivals. For example, it would help it fight against Dish’s Sling TV and Sony’s PlayStation Vue, which both offer access to live TV and select on-demand programming from broadcasters, but don’t invest in originals. (Vue’s first and only experiment with originals wrapped last year).
Meanwhile, Verizon’s live TV service will also have to compete against Hulu, which does have its own original lineup – and one that’s now breaking through with its first truly big hit, “The Handmaid’s Tale.”
YouTube TV, too, will be a competitor to whatever Verizon introduces. And its originals (via subscription product YouTube Red) are meant to appeal to a younger demographic, similar to go90.
Go90 today features content from AwesomenessTV – a company Verizon bought a 24.5 percent stake in – and which has more recently scrapped plans for its own standalone streaming product. The service also has shows from Rooster Teeth, BuzzFeed, Funny Or Die, CollegeHumor, Smosh, VICE, Elite Daily, Disney’s Maker Studios, and others. Go90 and other Verizon properties can also stream NFL football games, thanks to its $21 million rights deal.
McAdam’s statements didn’t offer much in terms of what Verizon has in store for its live TV service, only that it’s on the way. He did, however, hint at Verizon’s openness to M&A opportunities, noted Variety. This is in reference to remarks he made in April, saying that the company would consider mergers with Disney, Comcast or CBS, if the possibilities arose.
“I’ll say this about M&A: There’s a lot more energy on Wall Street and in the media than there is in most businesses at this point,” McAdam said, according to Variety’s report. “If there were an opportunity to accelerate the strategy, you should look at that.”
We could be a significant player for delivering broadband and video over-the-top,” the CEO also said.
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