Verizon is buying Vessel, the subscription video service founded by Jason Kilar (Hulu’s former CEO) and Richard Tom (its former CTO).
Vessel enlisted YouTube stars and other video creators, offering early access to their videos for $2.99 a month. It raised more than $130 million from investors, including Benchmark, Greylock, Bezos Expeditions and Institutional Venture Partners.
Tom will remain after the acquisition, but Kilar won’t, at least not long-term. As the Vessel founders put it in a blog post, “Jason’s focus will be to ensure a smooth transition through the end of this year.”
“At the heart of this transaction is the Vessel technology, product and team that we have built,” the post continues. “These three things will be married with Verizon’s ambitions in online video. Though the team and the actual tech + product will live on at Verizon in ways that will become apparent in the months and years ahead, sadly we will be sunsetting the Vessel service at the end of this month (October 31).”
Verizon, meanwhile, has been moving into media, for example with its acquisition of AOL, which owns TechCrunch, and more specifically into video, with its mobile app go90. However, go90’s reception has been pretty underwhelming, so the company is probably looking to rethink its strategy.
Verizon Entertainment General Manager Chip Canter told Recode (which first reported that a deal was in the works last month) that the company plans to merge some of Vessel’s social features into existing Verizon products and to explore subscription business models for its video content.