Verizon buys a video startup for its tech, kills the service
Verizon announced today that they’d acquired former Hulu CEO Jason Kilar’s startup, Vessel, a subscription service for short-form video. Or to be more exact, they bought its technology and product but will be closing the service. Kilar won’t be coming along as part of the deal, but many of the startup’s employees and its cofounder and CTO Richard Tom will, to become CTO of Verizon’s digital entertainment efforts.
Terms of the deal have not been disclosed and it is expected to close later this month. In an interview, a general manager for the telecom giant said they plan to merge social features Vessel was developing with Verizon’s extant content strategy, according to Recode. It could involve their free Go90 content service, which they aim to transition into a paid subscription model. Vessel’s annual subscribers will get a prorated refund to make up for its soon-to-be-shuttered service, and all customers will get October for free.
Kilar had left his position as CEO of Hulu in 2013 for unstated reasons, and took Tom with him. Both came out of stealth in June 2014 to talk about the startup they’d been working on: Vessel. They envisioned the service as an upstart rival to YouTube, offering both a free tier and a $3 per month subscription level for exclusive and ad-free content. But the startup never quite penetrated the market heavily dominated by YouTube’s vast library and viewership. With Tom at Verizon, it’s unclear where Kilar will go from here.
*Verizon has acquired AOL, Engadget’s parent company. However, Engadget maintains full editorial control, and Verizon will have to pry it from our cold, dead hands.
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