Verizon, the 1 billion dollar losing battle "GO90": "I was not likely to succeed" | Digiday [Japanese version]

There are a variety of launches, from plain to flashy, but the party that Belizon (Verizon) went to GO90 in September 2015 was rarely seen.A live performance by Zack Galiffian Nakis, a comedian that appears on the popular program of Kanye West, Funny or Die, a comedian in Between Two Ferns.And from John Legend to Sean White, the big celebrities appeared at the venue.Verizon's ambitious mobile video new business GO90 will surely see that the next big wave in digital entertainment.

The mobile phone company Belizon was about to become a media company.Moreover, I was prepared to pour a large budget there.While the younger generation viewers were flowing on YouTube and social, not the conventional television, the new video platform was ripe.Already young audiences have been watching high -quality content from digital video creators and media companies for hours on mobile screens.If it becomes a platform that can provide that level of content, it is natural that entry will increase.

But less than three years, this vision died.It was a GO90, which started with ambitious startups, such as Watchable (Watchable) by COMCAST, and Samsung., Belizon officially announced the service suspension of GO90 on July 31.Even if you have one of the world's leading distribution power and a huge budget, you have paid a high lesson to learn the lessons that will not succeed if you fail to capture the needs of your audience.

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"GO90 was not likely to succeed in the first place," said Peter Cathy, founder of Media Advice Creative Media."The industry did not really understand the GO90 strategy. Nevertheless, I was happy to receive the money. GO90 paid for the content that was not worth it, most of the officials.I'm reporting. "

Berizon, a big bet on a mobile video

Verizon's ambition for digital video increased when the Intel Media was acquired.Intel media was one of the web -based streaming TB services, Oncue, which was held by semiconductor manufacturer Intel.But, as Berizon himself learned later, the problem was that he had a hard time securing the program contracts needed to launch a paid TV bundle.

Immediately after the acquisition, Verizon sees new opportunities.The younger generations have never watched TV as much as the past.Instead, I spent time on YouTube and social.They were watching various types of videos and programs by emerging digital media companies and video creators.At the same time, these video creators were struggling to maintain profits as a business.As of 2014 and 2015, monetization was almost limited to re -paper -shareding, branded content, and sponsorship with YouTube plelor ads.

For many digital video creators, Verizon appeared like a savior.After the failure of milk video by Vessel and Samsung, a huge company that seemed to have an endless budget came in and was trying to bet on digital videos.And Berizon did not hesitate to pay the amount to be paid to the program producers.According to two sources, close to GO90, Berizon spent about $ 1.2 billion (about 135 billion yen) by the end of the project.This includes the amount used to acquire on -que and Vessel.The cost of the GO90 itself was less than $ 300 million (about 33.7 billion yen), but no details were obtained.

For some video companies, GO90 was a golden tree.According to multiple sources familiar with the actual situation of program contracts, Oramins TV (AwesomensStv) and Complex Networks (Complex Networks) have signed a "output" contract for over the years, each year.It seems that the amount has been paid (Belizon owns both stocks from both companies).

The importance of mobile is clear, but everything else is unclear

According to multiple sources that have received rewards from GO90, Berizon's selling complaints are the future of mobile videos, and consumer viewing habits are moving to the mobile screen.Was a bet as a base as a base.GO90 also claimed to be a premium environment, unlike YouTube.That will increase the advertising rate.GO90 said that he had a licensed TV program and talked about live distribution of sports and music events.

In an interview that was held earlier, Berizon's consumer products in Berizon, a senior vise president of the Senior Vice Division, and in charge of GO90, told Digiday."We are able to provide content that can spend a lot of time, and viewers can find premium -level content from all sources such as web, television and live."

Verizon's executives, who had been possessed from the first stage for the idea of providing a large amount of high quality content, said that multiple GO90 production partners had lost their focus.It doesn't seem that Belizon actually knew who was trying to reach.On the other hand, social platforms such as YouTube, Instagram (Instagram), and Snapchat (snap chat) have been continued to introduce formats and products suitable for mobile screen, and have succeeded in capturing younger generation users.rice field.

"I thought people would come to GO90 to watch a lot of videos, but no one really asked if they really wanted it.Where did the market research exist to the dollar cost? Everything was just an experiment. It felt like nobody did it. It seems to be a solution to the unreliable problem.One of the production partners, who has been collaborating with GO90 for many years, said.

The third step is profitability.But it doesn't work

One year has passed since Go90 was launched, and the content partners were dissatisfied with the number of videos played in 1000 units.In a joke, GO90 was called Slow 90.

Currently Berizon's senior vise president, the highest content responsible for the content, continued to stay as GO90 in the meantime.But under him, executives were replaced one after another, like a rotating door, and were trying to put GO90 on track.One year has passed, and one year has passed, and the executive Chip Canta, who has been in NBC Universal for many years, has entered.Cantant has hired Ivana Kirkbly, who has been working on YouTube and Vessel as the GO90's highest content.

The new strategy that GO90 called the "Content Sunday" approach was not so different from the old strategy.It creates original programs in various genres and formats, such as live sports broadcasts and licensed content.The question, "What is GO90?" Was raised by many production partners.

The new executive team had a background in the digital video entertainment field.The team includes former Brip (BLIP) executive Steve Wolf, former manufacturer Studio, and Yahoo's executive Erin Mcfiason.As a result, the optimistic feelings were spread among the GO90 partners.At last, Belizon also had a team to work on a mobile video in a wise way.He also hired a legal professional from YouTube and the entertainment field.They are experts who know how to negotiate content contracts, and have begun to seek contracts for GO90, such as a long -term monopoly period period.

But one of the roles of Cantant was to regain a part of the money to go to the GO90 production partner.It seems that Verizon was approaching the decision to stop the entire project.

Go90 to enter Aus

Earlier this year, the GO90 was under the management of public and technology Aus (Oath), born by the merger of AOL and Yahoo.At an event sponsored by RECODE, Aus CEO Tim Armstrong has been asked about the future of GO90, saying that it is uncertain how much the GO90 brand will continue in the future.

Before Armstrong's comment, the executives had stopped their new spending to wait for the merger.Before and after the comment, it is speculated that it will be the name of the GO90 or a different name, or that it will be played as a studio for developing projects for platforms owned by Aus, not the GO90 platform.I was.

Aus and Belizon seem to be in that direction.According to sources close to Verizon, Aus is dedicated to sports live distribution, sports, news, finance, and entertainment categories in categories.While Berizon is preparing to close the GO90 on July 31, the GO90 executives have offered options to move to other areas of the company.

It is unclear how the GO90 has a long -term GO90, even if Belizon and Aus will continue to work on videos.

Digital video creators, on the other hand, hoping that huge buyers will appear again.Perhaps Jeffrey Catchenberg's new TV (NEWTV) may finally enter mobile and short videos.Maybe, but.

"Some consumers' demand for digital content is good. GO90 did not understand it. Vessel did not understand it, but the room for other video services.I think there is. It is not just human resources who want advertising profits, but it is necessary to provide services by human resources who really understand how consumers act. "One of GO90's production partner said.

SAHIL PATEL (Original / Translation: Tsukamoto Kavi)