Verizon buys 24.5% stake in online-video startup AwesomenessTV for $159M, plans premium short-form mobile video service to launch with its go90 free service
Todd Spangler / Variety :
Context & Ripple Effects
The equity purchase caps a year-long escalation between the two companies. What began in March 2015 as a straight licensing arrangement — Verizon's deal for original content from DreamWorks Animation's AwesomenessTV — became a launch-supplier role when go90 went out the door as a free, ad-supported service stocked with shows from AwesomenessTV, AOL, Vice Media, and Viacom.
Now Verizon is converting its biggest youth-video supplier into a partial owner, paying $159M for 24.5% while planning a premium short-form mobile tier to run alongside the free go90 service. The move ties content supply to balance-sheet alignment just as the free tier alone has yet to prove it can anchor a carrier video business.
First-order effects
- DreamWorks Animation's AwesomenessTV gains $159M in cash and a strategic minority investor whose distribution reach now depends partly on its output, locking in supply for the planned premium short-form service.
Second-order effects
- Go90's other free-tier suppliers — AOL, Vice Media, and Viacom — gain fresh leverage to demand equity terms or richer license fees of their own rather than plain content deals.
- A premium paid short-form tier gives Verizon a second revenue line next to advertising, forcing rival carriers' mobile video efforts to answer with either their own exclusives or deeper discounts.
Third-order effects
- If carrier video keeps maturing this way, distributors stop renting content and start owning slices of studios — and Verizon's reported plan for a separate live online TV package points to a portfolio of free, premium short-form, and pay-TV tiers rather than one app.
- Minority-stake deals like this set a template for how telcos enter media: capital first, control optional, with full acquisitions left open if the partnership performs.
The trend: Wireless carriers are shifting from licensing content for free ad-supported apps to buying equity stakes in the studios that feed them, building layered free-plus-premium video portfolios on top of the network.