Will Verizon (VZ) Delay Online TV Streaming Service Launch?

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U.S. telecom giant Verizon Communications Inc. VZ is likely to defer the launch of an online TV streaming service, according to a recent report by AdAge. In Mar 2017, Bloomberg reported that this new service will be launched by Sep 2017. However, per the AdAge report, it could be delayed till the end of this year.

Initially, Verizon had decided to come up with dozens of channels nationwide for the new service. Management was negotiating with several TV network owners to secure online streaming rights. Management also stated that the new service will include some innovative features to differentiate its offering from the existing products in the market.

Nevertheless, AdAge reported that the company is still working on the specifics of the service such as pricing, programming and technology. The delay was primarily due to sudden departure of some important executives of Verizon's online TV and content division.

Notably, Verizon offers fiber-optic based FiOS TV services to its residential customers. This service is similar to that of cable TV operator's traditional video offerings. At present, the company is on the verge of carrying out test trial runs for its IPTV upgrade.

In 2015, the company launched go90, a YouTube-like streaming-video service aimed at teenagers. However, the new online streaming video service will be separate from the previous two offerings as it will compete with established low-cost streaming video services like Netflix Inc. NFLX and Amazon.com Inc.'s AMZN Prime video.  

Internet TV is gradually gaining market traction in the U.S. Of late, the legacy pay-TV industry in the country has been facing stiff competition from online video streaming service providers. The low-cost over-the-top video streaming service has resulted in massive cord cutting that is currently threatening the pay-TV business model. Internet TV has emerged a strong alternative to counter this competitive threat.

Last year, Verizon's closest rival AT&T Inc. T had launched its online TV streaming service - DirecTV Now. Satellite TV operator DISH Network Corp. DISH offers a similar product, Sling TV. Comcast Corp. CMCSA - the largest cable multi service operator in the U.S. and a media giant - is considering a strategic decision to rebrand its existing TV streaming service - Stream - to make it available across its footprint. The new service called - Xfinity Instant TV - is expected to start in the third quarter of 2017.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Symbols: AMZN , NFLX , T , VZ , DISH

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