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Verizon Communications said it would fork out about $106 million for a 24.5% stake in AwesomenessTV in a deal that also includes a new mobile video service that will launch as part of Verizon's go90 mobile app.
The deal, which is expected to close over the next 60 days, values AwesomenessTV at about $650 million. DreamWorks LLC owns a 51% stake in AwesomenessTV while Hearst Corp. owns the remaining stake.
The deal with AwesomenessTV, which has more than 3.6 million subscribers on YouTube, is another example of Verizon going all-in on mobile video that's aimed at millenials and "cord nevers."
The new mobile video service will feature short-form video content that will be funded by Verizon Communications Inc. (NYSE: VZ) and created with "the entire Hollywood community," according to Verizon.
The new service will initially only be available on Verizon's platforms in the United States while AwesomenessTV will retain the world rights. A spokeswoman for Verizon said the short-form content would be available by the end of this year.
The short-form video service will operate as a new and independent brand, and feature premium transactional content for a variety of audiences.
AwesomenessTV, which has more than 3.6 million subscribers on YouTube, signed a programming deal with Verizon in October, which was the same month that go90 launched. Verizon also inked an agreement with DreamWorksTV the same month. (See Verizon, Sony Primp for OTT Debuts.)
"In addition to delivering compelling scripted and non-scripted series with high production values, AwesomenessTV has demonstrated an ability to zero in on programming that Gen Z and millennials want to watch," said Marni Walden, executive vice president and president of Product & New Business Innovation, Verizon. "The content AwesomenessTV has produced for go90 has exceeded all our expectations with shows such as Guidance and Top Five Live. That's why we want to be in the AwesomenessTV business."
— Mike Robuck, Editor, Telco Transformation
