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Verizon Launches OTT Video Service on Trial Basis
In an attempt to show that telecom players do not need to lose ground to mobile ad industry companies such as Google and Facebook (News - Alert), Verizon launched a trial version of its over-the-top (OTT) mobile video service, which is called go90. The trial will be initially offered to existing customers in select, unnamed markets this week.
Although Verizon (News - Alert) declined to mention any names at this time, the company did say that advertisements would be coming from well-known brands. It is expected that the free service will drive revenue from data usage, as well as from targeted advertising.
According to industry watchers, the expectation is that Verizon will take advantage of its AOL (News - Alert) acquisition and rely on that technology to support its ad strategy. This is viewed as being Verizon’s best opportunity to prove its advertising potential since AOL has built tools to deliver targeted Web and mobile ads.
Brian Angiolet, Verizon's senior vice president, consumer products, believes that targeted advertising tools will be available in the near future as the process to integrate AOL’s technology with Verizon’s video service has already started.
It should come as no surprise that the target market for the service is young viewers or Millennials. Verizon hopes to have up to 200 hours of exclusive content available from online video networks such as AwesomenessTV and Machinima.
According to The New York Times, Verizon executives made the decision to not include the word "Verizon" when choosing a name for the OTT service. Instead it is emphasizing that go90 will be available to all wireless customers, regardless of carrier. The name refers to the act of turning a phone 90 degrees to watch video in landscape mode.
Verizon is currently in talks with advertisers about its ad-delivery tools and in addition, it is focusing on its customer data, which includes location, wealth demographics and prior purchase history. Although the go90 service will not include complete network show rosters, the trial will offer free programming from providers such as Comedy Central, Food Network, ESPN (News - Alert), Discovery Network, VH1, as well as a few others.
Verizon did not provide any details concerning which devices would be compatible with the trial service. The company did mention that go90 users will be able to set up personalized profiles for their viewing pleasure. The service should automatically continue to update its offerings with new shows and content.
Craig Moffett, an analyst at MoffettNathanson, recently commented that due to the fact that “Verizon is currently the only video service to offer advertisers customer data based on location, at the personal level rather than the household level, with unprecedented knowledge of purchase intent and a wealth of demographic and prior purchase information,” that its video strategy holds genuine promise.
“Pretty much without exception telecom operators have not been successful as third parties in exploiting the Internet access service, whether it's video or anything else,” said Telecom industry consultant Tim Farrar. “What percentage of people’s app viewing is going to be over a Verizon app versus YouTube (News - Alert) or Facebook...That’s the biggest uncertainty."
The trial run of go90 began this week and it is expected to have a full-scale launch sometime later this month or at the latest, early next month.
Edited by Rory J. Thompson