Verizon CEO Admits Go90 Mobile Video Service 'Over-Hyped'24 May, 2016 By: Erik Gruenwedel
Since its September 2015 launch, go90, the ad-supported mobile video service/app, has been touted by Verizon as an alternative to the burgeoning over-the-top video market.
Following a March UBS research note that suggested consumer interest in go90 has been limited, Verizon CEO Lowell McAdam admits the app — created in part from an IPTV platform acquired from Intel — is slow out of the gate.
Speaking May 24 at J.P. Morgan Global Technology, Media and Telecom Confab in New York, McAdam said Verizon remains committed to the service — with slightly lower expectations.
“I think it did get a little bit over-hyped and I'm sure we contributed to that to a certain extent, but we didn't believe that it was going to move the needle on the $130 billion revenue stream overnight,” McAdam said.
Characterizing go90 as “patient money” in a business outside of Verizon’s “core competency,” McAdam said the app will continue to evolve slowly, including incorporating content from AOL, AwesomenessTV, Comedy Central, music and live sports (NBA, NFL), among other sources.
Instead of offering the app as a subscription streaming service, Verizon opted for free access — a strategy some critics contend is really aimed at driving up a user’s monthly data bill. Indeed, a month after launching, Verizon announced it would increase by $20 the monthly rate for its unlimited data plan, to $50.
Regardless, McAdam said go90 remained in "a good spot" from Verizon’s perspective.
“It was one of those things you have to work into. We're on pace,” he said.
UBS analyst John Hodulik, in a March note, said the go90 app ranked “around No. 300” on iTunes, including 20th among entertainment video apps. The app is also available for Android devices.
“We believe go90 will be hard-pressed to mount a meaningful challenge to mobile video and social networking leaders YouTube, Facebook, Instagram, Snapchat, Netflix and Hulu,” Hodulik wrote.