Verizon Communications has launched a trail version of its new video mobile service in its bid to be the first telecom player to compete with mobile ad industry titans Google and Facebook.
The Company’s new “go90” mobile app has initially been offered to a select set of Verizon customers, with supported advertisements from well-known brands.
According to Verizon’s Senior Vice President, Brian Angiolet, Go90 is to target young viewers, or millennials, with between 100-200 hours of exclusive content from online video networks such as AwesomenessTV and Machinima. The free service will drive all its revenue from data usage and targeted advertising.
Since purchasing AOL’s ad technology in June for US$4.4 billion, Verizon is to leverage these expertise in order to have the best chance to prove its advertising potential. These tools from AOL enable Verizon to deliver targeted web and mobile ads. Combine this with Verizon's customer data skillset and this should improve targeting, analysts say.
The AOL technology is in the process of being integrated with Verizon's video service, and targeted advertising tools will be available over time, Angiolet told the media.
According to a Company spokesperson, the service could be officially launched to all Verizon users as soon as later this month.
Companies from Netflix Inc to Dish Network Corp already offer web-based video services through subscriptions, but Verizon’s ad-supported, short-form video model seems an unusual approach to a somewhat niche market.
“Go90 pits Verizon against internet advertising industry heavyweights Google and Facebook, and advertisers will take a ‘wait and see’ approach to determine how many viewers Verizon captures,” telecom industry consultant Tim Farrar noted.
“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,” Farrar said. “What percentage of people’s app viewing is going to be over a Verizon app versus YouTube or Facebook...That’s the biggest uncertainty.”
Verizon's rival AT&T Inc has said it has mobile video services targeting youth in the works. Smaller rivals such as Sprint Corp and T-Mobile US have also said they are watching their competitors' efforts closely.
Verizon is reportedly in talks with advertisers and brands about content sponsorships and original-content creation. The service lets users post comments, form interest-based groups and clip and share videos in social networks.
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. Only time will tell if its approach will be successful.
According to the Company, Go90’s content portfolio will evolve in the coming months, with upcoming digital video service promising content from the National Football League, DreamWorks Animation's AwesomenessTV unit and Vice Media.
As its trial period begins, content partners include Comedy Central, Food Network, ESPN, Discovery Network and VH1. From the web, it will offer videos from Maker Studios, Machinima and StyleHaul, among others.