NEW YORK (Reuters) - Verizon Communications Inc (VZ.N) is in talks with advertisers and content makers to offer sponsored video, such as sports games and music concerts, to users of its mobile-video service go90 at some time in the future, CFO Fran Shammo told Reuters. Sponsored data is like a toll-free line to consume data on mobile phones from video streaming to app activity. Wireless providers bring in sponsors such as brands and advertisers to pay for data usage so that it does not count against a consumer’s data cap.
Most Americans own a mobile phone and a saturated U.S. wireless market has Verizon and its rivals turning to new businesses. Verizon is making a big bet on mobile video aiming to unlock revenue from advertising and data usage.
“What we’re trying to get after is for sponsors to come in and pay for the sponsorship to put exclusive content on go90,” Shammo said. “You’ll see certainly a lot of activity on go90 and sponsorships and advertisers.”
He did not provide details on discussions with potential sponsors and content makers or a timeframe on when sponsored content will begin appearing on go90.
Verizon launched its go90 mobile video app in October and has announced content partners such as the National Football League, the National Basketball Association, AwesomenessTV, the Food Network and Vice Media.
Since acquiring AOL Inc and its advertising technology for $4.4 billion in June, Verizon executives have said that its ad-supported go90 model will include a combination of highly targeted commercials, content sponsorships, exclusive content and pay-per-view live concerts and sporting events.
Sponsored content is the “basis of the go90 model,” Shammo said.
When asked if content companies such as the National Football League could partner with Verizon’s go90 to bring advertisers and brands to sponsor content, Shammo said, “we’re open to anybody.”
The National Basketball Association, which has an agreement with Verizon to offer some exclusive videos on go90, could be an example of a potential partner that could let Verizon rope in advertisers or brands to sponsor certain video offerings on the mobile-video service, Shammo said.
The NBA and NFL declined to comment. Earlier this week, Verizon launched a wide sponsored data plan with two services: “FreeBee Data 360” lets content providers sign up to provide consumers some or all of their mobile content, without using up their data plan. The second service under FreeBee Data lets content providers sponsor specific consumer actions such as video clip views, audio streaming and app downloads based on each click.
Verizon’s competitor AT&T Inc (T.N) has been testing sponsored data offers since 2014 and in November, T-Mobile US Inc (TMUS.O) said it would let customers stream video from video services including Netflix Inc (NFLX.O) on their mobile devices without having it count against their data plans.
Reporting by Malathi Nayak; Editing by Andrew Hay