Nearly 18 months after the ballyhooed launch of its mobile video platform, Verizon’s Go90 platform has failed to leave its mark on its youthful target audience.
In fact, speaking to FierceOnlineVideo, Frost & Sullivan analyst Dan Rayburn bluntly labeled the platform “dead.”
Really? Dead? “Pretty much,” Rayburn responded in an email exchange. “No one uses it. It almost doesn't exist at this point.”
The No. 1 wireless company reportedly spent $80 million just on launch marketing for the platform. And it spent much more on the short-form content that has so far failed to hit the mark with a young U.S. target market. Verizon hasn’t released any data on the product, but numerous published reports say the company has met with its content creators recently and conceded that the platform hasn’t met expectations.
Verizon now finds itself in a Catch-22, needing to risk further losses in order to make its prior investment worthwhile.
“They either sink more money into content on the chance it doesn’t bear fruit, or they don’t invest enough and the service never catches fire,” Amy Yong, an analyst with Macquarie Group Ltd., told Bloomberg.
After spending $4.4 billion to buy AOL and its ad tech wherewithal in 2015, and another $4.8 billion last year on Yahoo’s internet business, count on Verizon to keep throwing money at Go90 until something good happens.
Last week, it was revealed that Verizon laid off around 155 workers from Go90’s technical operations, replacing them with staffers acquired in last year’s purchase of Vessel, the online video company started by former Hulu CEO Jason Kilar.
That restructuring followed a rebuilding of the platform’s content team.
Earlier last year, Verizon hired former NBCUniversal executive Chip Canter as general manager of digital media, a hiring that beget the acquisitions of former YouTube exec Ivana Kirbride and ex-Yahoo operative Erin McPherson to the Go90 team.
If any of these changes have moved the needle, it’s tough to tell. Verizon hasn’t released any kind of viewership metrics on the ad-based platform.
Speaking at Verizon’s fourth-quarter earnings call last week, CFO Matt Ellis seemed to reach for some metric of progress.
“With a focus on delivering timely, short-form versions of video clips we have seen digital video consumption gain traction in the last year,” he said. “At the content and solutions layer of our three-tier strategy, the combination of AOL, Go90 and other content has enabled cross-platform sharing. This strategy expands our distribution and revenue opportunity globally across carriers and networks.
“We have seen increased usage in the Go90 application through this exchange and we are expanding our unique content offerings,” Ellis added. “The average daily usage in go90 was consistent sequentially at about 30 minutes per viewer, with less than 20% of traffic surfed on the Verizon wireless network in the second half of the year.”