Verizon on Wednesday continued its go90 content purchasing binge with an agreement to buy nearly a quarter stake in AwesomenessTV, a youth-focused media company owned by DreamWorks Animation and Hearst.
Under the terms of the deal, Verizon will own 24.5 percent of AwesomenessTV alongside Hearst and DreamWorks Animation, which each will own stakes amounting to 24.5 percent and 51 percent of the company, respectively. The agreement values the multi-platform media company at $650 million.
The deal is expected to close in the next 60 days, Verizon said.
The agreement will see AwesomenessTV create a millennial-focused, short-form mobile video service for Verizon that will launch as a part of the carrier’s go90 mobile video platform.
“AwesomenessTV has demonstrated an ability to zero in on programming that Gen Z and millennials want to watch,” Verizon’s executive vice president and president of Product and New Business Innovation Marni Walden said. “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.”
Verizon said the AwesomenessTV content will initially be exclusive to the carrier’s U.S. platforms, but noted the media company will be able to sell its content to the rest of the world.
The move comes on the heels of deal between Verizon and Hearst last month under which the latter will produce two mobile TV channels for the go90 platform.
Both deals appear to be part of Verizon’s efforts to bolster its go90 mobile video platform.
Launched in October, go90 has been slow to gain traction and Verizon CFO Fran Shammo has warned the product likely will not become profitable for another year or two.
And it looks like go90 will have an uphill battle to fight.
Last week, AT&T announced a partnership with global youth media company Fullscreen to offer a Subscription Video on Demand (SVOD) service to its mobile, video and broadband customers starting at the end of this month.
AT&T aside, UBS said in March go90 will be “hard-pressed to mount a meaningful challenge” to leading competitors like YouTube, Netflix and Facebook.