Vessel to close following Verizon acquisition
James R | On 27, Oct 2016
Verizon is closing its doors this Monday, following the acquisition of the site by Verizon.
The streaming service was launched last year as a subscription alternative to YouTube. Offering subscribers early access to videos from participating vloggers, and giving those creators a way to earn extra revenue, Vessel’s thunder was promptly stolen by the launch of YouTube’s own SVOD offering, YouTube Red. Nonetheless, Vessell continued to roll out new features, such as mobile apps, social media sign-in and PayPal support. All that work didn’t build much traction with users, but was not in vain, as Verizon has now bought the technology and software powering the start-up.
The result is a bittersweet success, but one that reinforces founder Jason Kilar’s as a key player in the streaming landscape; Kilar was CEO of US VOD service Hulu, before spying an opening in the streaming landscape and launching Vessel. With technology as important as branding in the modern media era, many start-ups dream of being snapped up by a larger entity, a trend that has swiftly become the norm, thanks to deals regularly inked with such giants as Facebook and Google.
The terms of Verizon’s deal have not been disclosed, but the acquisition is intended to boost the communications comany’s over-the-top video arm. It follows the acquisition of AOL and an ongoing deal for Yahoo, as the firm works on a premium streaming service featuring short-form video, in conjuction with AwesomenessTV. (It owns a 24.5 per cent stake in them as well.)
“When we examined and evaluated all that the Vessel team has executed to date and their technical strengths in areas of content discovery, recommendation, OTT subscription management and user experience management we were able to identify a number of ways this was a smart pairing,” Chip Canter, general manager of Verizon Entertainment, told THR.
Kilar is expected to depart the company at the end of the year, after assisting with the transition, while the majority of Vessel’s staff are likely to hired by Verizon. CTO Richard Tom, who co-founded Vessel with Kilar will stay on to lead technology and operations for Verizon Entertainment.
Kilar and Tom announced the deal on Vessel’s blog, with subscribers to receive a free month of service for October and annual subscribers to be refunded.
“They share our belief that internet protocol will inevitably become the dominant way consumers access great video experiences,” they said. “The Verizon team has backed this conviction with material investments and a focus on what makes them unique in a competitive marketplace. It’s easy for our team to imagine the amazing ways customers can be served when Verizon’s high speed wireless platform is combined with their strategic commitment to video and our team.”
“At the heart of this transaction is the Vessel technology, product and team that we have built. These three things will be married with Verizon’s ambitions in online video,” they added. “Though the team and the actual tech + product will live on at Verizon in ways that will become apparent in the months and years ahead.”