Verizon Snags Broad HBO Now Rights

Seeking to make its own big splash in the over-the-top video market, Verizon has struck a deal to offer the HBO Now OTT service to both its broadband and mobile subscribers.

Verizon Communications Inc. (NYSE: VZ) and Home Box Office Inc. (HBO) announced a sweeping deal Tuesday that gives the big US telco the right to distribute HBO Now to its 9.2 million standalone broadband customers today, including both DSL and FiOS subscribers. Verizon thus joins one of its chief broadband and pay-TV rivals, Cablevision Systems Corp. (NYSE: CVC), in offering the new HBO OTT service to its customers. Like Cablevision, Verizon is offering the service for $14.99 a month, following a 30-day free trial.

Even more intriguingly, the deal allows Verizon to distribute HBO Now to all of its other "digital platforms," including its nearly 110 million wireless subscribers. In their joint announcement yesterday, the two companies said HBO content will "be coming soon to Verizon's upcoming mobile platform," which will reportedly be called Go90 and is slated to launch later this summer. It will be a free, ad-supported service. (See Verizon Dubs New OTT Service Go90 – Report.)

In other public statements, Verizon has confirmed over-the-top content deals with AwesomenessTV and DreamWorksTV; Viacom Inc. (NYSE: VIA); Vice Media; Scripps Networks ; and several sports networks, including ACC Digital Network, Campus Insiders, CBS Sports, ESPN and 120 Sports. Verizon also just completed its purchase of AOL, which will bring in both more content and a well-established advertising platform.

Want to know more about OTT video trends? Check out our dedicated OTT video content channel here on Light Reading.

As a result, the planned Go90 service looks to be increasingly well-stocked with entertainment, sports and other programming. Verizon has not yet revealed whether Go90 will be a "skinny-bundle" or bigger-package service.

With the pickup of Verizon, HBO Now continues its relentless expansion of traditional and non-traditional video outlets. Besides being offered by Cablevision and Verizon, the standalone OTT service is now being distributed via Apple Inc. (Nasdaq: AAPL) devices, Android tablets and smartphones and Amazon Fire tablets. HBO has also swung distribution deals to put the service on Chromecast and other Google (Nasdaq: GOOG) mobile devices, as well as other Amazon Fire and Android TV devices.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

KBode 5/31/2016 | 1:21:58 PM
Re: OTT cola wars Though HBO sees this (for now) as free marketing, not necessarily revenue leakage. They believe that Millennials using others' (usually parents) logins become their own standalone customers down the road. 
mendyk 5/27/2016 | 9:07:41 AM
Re: OTT cola wars Yes -- it's clear that piggyback piracy -- as in, unauthorized sharing of a legitimate passcode for a service -- is the favored means of content acquisition among millennials, for instance. In the olden days, that was known as revenue leakage, and it was an accepted if somewhat annoying condition as long as the leakage stayed in the low single digits. The potential for more significant revenue loss is now much greater.
KBode 5/27/2016 | 8:15:02 AM
Re: OTT cola wars One problem is going to be the growing trend toward exclusivity (like the Netflix Disney deal). Consumers that are confused about where they can find their favorite shows on streaming -- or don't want to pay twenty different companies $15 a month -- will simply head back to cable or migrate to piracy. 
KBode 5/27/2016 | 8:13:54 AM
Re: Video-free cable Depends on their scale. Smaller cable providers that lack the leverage for the best possible deals will exit, but bigger companies will stick it out -- refusing to compete on price until cord cutting shifts from trickle to dull roar. 
mendyk 7/30/2015 | 2:10:45 PM
Video-free cable Optimum (aka Cablevision) is now offering a cord-cutting package that includes broadband service and "free broadcast digital TV" -- which means it's supplying a digital TV antenna at no charge to its broadband subscribers. I can't see this as anything but definitive proof that operators now see old-school video as a business that's no longer worth being in.
MikeP688 7/30/2015 | 1:46:55 AM
Re: OTT cola wars I like the way you deemed it @mendyk--hundreds of choices--but virtually the same thing. It seems to me that they ought to worry about content more than anything else.    There is where the value is--and there is they have the challenge.    
mendyk 7/29/2015 | 1:47:27 PM
OTT cola wars This OTT stuff is starting to feel like shopping in the soda aisle at the supermarket -- seemingly hundreds of choices, but all of them delivering basically the same thing.
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