Editor’s Corner—How Verizon can actually make its streaming TV different

Verizon sign
Ben Munson

In an inevitable turn of events, Verizon has confirmed that it too will launch a streaming TV service and that it will be “different.” But with so many competitors already working to perfect the model, what can Verizon actually do differently?

When Verizon’s virtual MVPD surfaces later this year, it will be competing directly against U.S. pioneers in the space like Sling TV and PlayStation Vue, as well as more recent arrivals like DirecTV Now, YouTube TV, Hulu’s live TV and FuboTV.

It’s a large field that’s been hard at work experimenting and tinkering with pricing, programming, and maintaining quality of service. That means when Verizon’s live TV service makes its debut, there will be significantly fewer ways for it to stand out.

Nevertheless, Marni Walden, executive vice president and president of media and telematics, has promised that Verizon’s streaming TV won’t be like everyone else’s streaming TV.

“Originals are important and sports are really important. But we don’t want to do just a ‘me too’ thing out there. You’re going to see us do things in a different way. It’s definitely not about quantity though. There are some things you have to have but we’re not looking for the kitchen sink on this one,” Walden said.

Verizon has tried to be different before in the video space when it launched Go90, which by many accounts is not catching on with consumers. Michael Goodman, director of digital media strategies at Strategy Analytics, said Verizon should be careful to sacrifice appeal for the sake of standing out.

“What I really hope they don’t do is come up with something different like Go90. That was different alright. Different is not always the same as successful,” Goodman said.

Though Verizon’s official launch is still likely months away, it’s already time to start looking at just how Verizon could actually differentiate in a crowded field.


The field of vMVPDs into which Verizon will enter is largely populated by similarly priced services. Available services are generally priced around $35 to $40, although Sling TV starts as low as $20 and Vue jumps as high as $65, and various add-ons can drive up prices quickly for other services as well.

Should Verizon pursue similar programming deals that delve heavily into broadcast networks, live sports, news and (to a less extent) the core cable networks, it’s likely the basic tier of Verizon’s vMVPD will be priced in the same $35 to $40 range. Either that or Verizon takes a bath on its programming costs.

However, Goodman sees an opportunity for a U.S. vMVPD to offer something outside of the traditional subscription model, like what some international operators do.

Sky’s Now TV in the U.K. not only offers monthly subscriptions, but the service also offers networks and channels on a weekly or a daily basis. Goodman said Sky doesn’t give out numbers but it has said the daily and weekly transactional revenue is growing and has been successful in attracting customers who might want certain channels for television events.

Goodman was careful to say that this isn’t necessarily what Verizon is doing but it would be an option for the company.

Another option for Verizon would be to rely more on advertising support and potentially decrease the cost of subscriptions. With its Yahoo deal officially closed and integration of AOL and Yahoo underway – with the companies being rebranded as Oath – Verizon may have a leg up in advertising acumen, particularly on a digital platform like streaming TV.

Michael Inouye, principal analyst at ABI Research, sees targeted advertising providing an edge for Verizon in the vMVPD market.

“We expect Verizon will try to leverage its strong expertise in advertising (through AOL and soon Yahoo under “Oath”) and network of users (both through their acquisitions and wireless subs),” said Inouye. “Playing to Verizon’s strengths the company could offer more flexible pricing tiers and in particular those with heavier (and ideally more targeted) advertising. A primarily ad-based service would in some ways buck the trend we’ve seen moving away from ad-based services.”


Like traditional MVPDs, vMVPDs are mostly pulling from the same pool of content as all other competitors, making differentiation difficult.

Some vMVPDs – particularly those not aligned with a traditional pay-TV provider – have opted not to carry some of the core cable networks from programmers like Discovery Communications and Viacom. Hulu and YouTube TV, at least off the bat, appear to be focusing on broadcast and sports.

If Verizon is dedicated to maintaining FiOS as a viable TV service, than a vMVPD becomes more of a flanker brand for Verizon, according to Goodman. In other words, if Verizon’s FiOS TV service is going to be cannibalized, at least Verizon could cannibalize itself via its streaming TV service. But Goodman said that if Verizon isn’t focused on presenting a lower priced but similar offering to FiOS, lots of new options for programming and bundling appear for Verizon.

“If you’re willing to blow up the FiOS TV, then that opens up a lot more options,” Goodman said.

Of course, in the vMVPD world, a healthy slate of originals is still a viable strategy for setting a service apart. Among the established vMVPDs, only Hulu has a high-profile crop of originals, giving Verizon an opportunity to stand out if it too can develop and launch original series with broader appeal.

Verizon has been active in launching original titles for Go90 and going after lucrative programming rights like the NFL. Inouye said that those factors, combined the possibility of an Oath content engine, could be a crucial differentiator for Verizon.

“Verizon has also been active acquiring content rights (e.g. sports and for Go90) and could also push original programming from its Oath group along with the more traditional programming – Yahoo had backed away from original programming but there could be a renewed push,” said Inouye. “Ultimately though the combination of Oath, existing services, along with content should lay the groundwork for differentiation, even if the largest differences run deeper than the programming alone.”

Quality of service

Delivering a quality signal has been an issue for all the vMVPDs. They simply do not have the same degree of reliability as a traditional TV service delivered across a managed, facilities-based network.

Sling TV and DirecTV Now have all had technical issues with things like signal loss, authentication, sign-on and degradation of video.

Verizon may benefit by being the seventh service in line to run through the streaming TV obstacle course after having watched and learned from the first ones to go. And it could possibly go to school on what Hulu has been doing to build a streaming TV service that’s more resilient to the pressures of maintaining QoS even while growing its user base and putting more strain on the backend.

Hulu CTO Tian Lim recently said that Hulu is working to future-proof its TV service for a time when its subscriber base might become large enough to cause technical issues.

“I don’t think we’re large enough yet to have run into some of the issues that others have with concurrent streams. I do think we have a strategy that will allow us to deal with that. That is why we deployed a lot of our infrastructure into the cloud. It gives us a lot of push capacity to avoid some of the classic pitfalls that you might run into as you scale users,” Lim said.

Of course, Verizon has Verizon Digital Media Services, an entire division of the company dedicated to online video streaming and content delivery networks. No doubt that asset will be put to good use in any plans the company has for streaming TV.

If Verizon can apply the lessons learned by its predecessors and use its nationwide networks to quickly drive scale, it could become one of the first vMVPDs to achieve a large user base and relatively reliable video service in the early days of streaming TV. — Ben | @fiercebrdcstng