WSJ: Verizon Communications Inc. (VZ), Hearst, to Partner on Digital Joint Venture

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Verizon Communications Inc. (VZ) and Hearst Corp. are close to partnering up in a joint venture aimed at creating two new digital media brands , according to a Wall Street Journal report published late Friday afternoon.

Verizon-communications-stock-logo-185The brands would be developed specifically for go90, the mobile video app that Verizon is devoutly working on in an effort to focus more on content. VZ showed just how much it values content as an avenue for growth when it bought AOL for $4.4 billion in June 2015. With growth in wireless subscribers slowing, Verizon’s only choice is to diversify into other business lines.

The WSJ describes the brands that VZ and Hearst are working on, though the ideas are still nebulous:

“The exact genres of the new channels are being worked out. Possibilities under discussion include a politics-focused comedy network and one with heartland-focused content for Millennials, which one person familiar with the project described as akin to ‘Vice for the red states.'”

As of Verizon’s earnings report on Thursday, the go90 app had been downloaded more than 2 million times. With millennials increasingly “cutting the cord” and spending more time on mobile devices, the future of content is likely to be mobile-centric, and VZ wants to be a first-mover in that area.

It looks like VZ is getting its wish, although it remains to be seen what kind of returns that will foster.

At the time of this writing, Robert Martin held no position in any of the stocks mentioned.


Article printed from InvestorPlace Media, https://investorplace.com/2016/01/verizon-communications-inc-vz-hearst-digital-joint-venture/.

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