Verizon is no longer thinking about joining the vMVPD race with its own service. Rather, the company is looking to partner with an existing MVPD, package their product with its own Oath-branded content and deliver it all via 5G.
That is the plan as stated by Verizon Chairman and CEO Lowell McAdam in an interview with company’s Yahoo Finance unit yesterday.
“We made our bet several years ago, before we bought AOL and Yahoo and combined them together to do Oath, that we weren’t going to be investing in the linear TV model,” McAdam said. “I’ve said this a couple of times—I think the linear model is dead. It’s just going to take a long time to die. So we’re not out there buying these big content companies trying to achieve scale. We’re much more into the digital area.”
He added, “Our view is we should partner with those that are in the linear game, let them be very good at what they do. We’ll add digital content to that mix and we’ll position ourselves for where we become more of an over-the-top video culture versus the linear model that we have today.”
Verizon, which reportedly grappled with launching its own virtual MVPD until recently, will have new video products launched in the fourth quarter, McAdam said. “We will have a partner picked out and we’ll integrate our Oath assets into their linear assets that they have and bring the full package to customers,” he explained. “We think that’s going to be a big hit from a customer perspective.”
McAdam framed the discussion of video around Verizon’s upcoming launch of 5G services, which will initially debut in Los Angeles, Sacramento and two other U.S. cities.
He didn’t suggest which MVPD Verizon would partner with. However, speaking at Fierce’s Pay TV Show last week, TV[R]EV co-founder and lead analyst Alan Work suggested startup vMVPD fuboTV might be a “really ripe target” for either partnership or acquisition by Verizon.
For his part, Wolk suggested Verizon and its Fios linear TV services are a “Harvard Business School case study” for how a company “blows an incredible lead.
Just a few years ago, U.S. pay TV consumers were pleading, “We want Fios in our town,” Wolk said.
Asked when Verizon might finally launch its own streaming service, the analyst proved prescient: “I don’t think they’re going to launch anything,” he added.