Verizon this morning has made another move to ramp up its media business, and specifically, bring new content to its mobile video streaming service, go90. The company (and AOL parent, which owns TechCrunch), says it will be taking an approximate 24.5 percent stake in the Dreamworks’ video company AwesomenessTV. The deal will also see Verizon and AwesomenessTV creating a short-form mobile video service that will have its own, independent brand and will launch as part of the go90 streaming service.
Verizon says it will fund this service through a multi-year agreement with AwesomenessTV, while the video company will help to provide the talent both in front of and behind the camera.
You may recall that Dreamworks acquired the teen-focused YouTube network AwesomenessTV back in 2013 for $33 million in an effort to acquire traction in the original content creation space. At the time of the acquisition, the network had 14 million subscribers and 800 million views across 55,000 channels. When Hearst invested in the network the following year, it had grown to over 114 subscribers. Today, its network includes 90,000 video creators and over 16 billion views.. It had 143 million subscribers as of last fall, and now has 170 million.
The new deal with Verizon won’t impact Dreamworks’ ownership – that company will remain the majority shareholder with 51 percent stake; Hearst will own the remaining 24.5 percent. Meanwhile, Brian Robbins, AwesomenessTV’s founder and CEO, and Brett Bouttier, AwesomenessTV’s President, will continue to lead the company, says Verizon in its announcement.
Verizon and AwesomenessTV already had a relationship prior to this investment, as the video network was providing content for go90, including shows like “Guidance” and “Top Five Live.” This investment expands that relationship further, as AwesomenessTV will now make videos for Verizon.
The new content Verizon will fund will be exclusive to Verizon in the U.S., which means that it will only be available via go90 and other platforms where the company may choose to distribute it. However, AwesomenessTV will retain the rights to resell that content elsewhere in the world.
The companies haven’t announced the new brand details yet, but it will include both premium scripted drama and comedy in all formats, Verizon tells us. Plus, it’s expected that highly serialized content will also be a “big part” of the offering. We understand that much of this content will be short-form. A team at AwesomenessTV will be programming and operating the service, while Verizon is the backer.
And yes, by “premium content,” Verizon means paid. While go90 is ad-supported, this deal allows Verizon to expand into a pay-for model that would let users access these more exclusive programs. According to sources, whether that means users will be able to buy an individual episode or show/season bundles is not yet known as those details are still being ironed out.
The new content will launch on go90 either at the end of this year or early 2017, Verizon says.
“The creation of this new branded service represents a transformational step, not just for AwesomenessTV, but also for the entire mobile video landscape,” said Jeffrey Katzenberg, CEO of DreamWorks Animation in a statement. “This agreement is clearly impactful for AwesomenessTV – with annual revenues expected to more than double in the first 12 months of content delivery – and even more exciting is the expansion of our relationship with Verizon, one of the world’s most powerful marketers and content distributors, and their commitment to explore with us this incredible opportunity.”