As U.S. telco Verizon continues to beef up its mobile and video offerings, it’s made another major investment — this time in AwesomenessTV.
Verizon has acquired a minority stake in the company, purchasing 24.5% of the Gen Z-friendly multi-channel network and media co. Following the investment, Awesomeness is now valued at $650 million, according to a joint media statement issued by the two companies. The share price paid by the telco has not been made public.
The injection of new money will see Awesomeness create a new transactional VOD service funded by Verizon, which will feature short-form content created by and starring in the network’s most popular digital influencers. The new service (launch date TBD) will operate within the go90 app. Awesomeness will still retain ownership of the content and the rights to sell it to other distribution partners.
DreamWorks Animation, which acquired Awesomeness in 2013 for $33 million, remains the majority stakeholder, with 51% ownership. Hearst owns the remaining 24.5%.
No major changes in AwesomenessTV’s leadership are expected to take place as a result of the deal, the companies stated.
Less than a year ago, Verizon also took ownership of AOL, a major step in its much-publicized bid to establish itself as a significant mobile video presence in the U.S. market. The company later launched the mobile video service, go90, which has snapped up original content from the likes of New Form Digital, Pilgrim Media and Awesomeness, among other digital producers.
The investments by Verizon have been rich, but lauded as a smart move by analysts.
“Verizon’s markets are mature, and online video plays are (still) underpriced. (Verizon) is really buying into an adjacent market for cheap,” said Kaan Yigit, president of Solutions Research Group, in an email to StreamDaily.
Awesomeness and Verizon have been working together since April of 2015, when the media co first signed a deal to provide Verizon with content for go90. It’s since produced a number of series, including an unscripted series from reality stars Snooki and JWOWW and an upcoming series from beauty vlogger Kandee Johnson (pictured).
Awesomeness’s deep knowledge of millennials and Gen Z viewing habits, and its associated brand partnerships, played a big part in Verizon’s interest in purchasing a stake in the company, said Marni Walden, EVP and president of product and new business innovation at Verizon.
“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,” said Walden in a statement.
The deal was advised by LionTree Advisors LLC and J.P. Morgan Securities LLC.