Verizon CFO: Redbox Video Venture Launch Planned for August
NEW YORK - Verizon's joint venture with DVD rental kiosk operator Redbox will see its commercial launch in August, Francis Shammo, the telecom giant's CFO, told an investor conference on Monday.
When they recently announced the venture, in which Verizon has a 65 percent stake, the partners only said they would launch the service, which will compete with Netflix by offering streaming content, during the second half of the year.
Speaking at the Deutsche Bank 2012 Media & Telecom Conference in Palm Beach, Fla. in a session that was webcast, Shammo didn't provide details on the likely video service's brand name, cost or content.
He also said that Verizon expects to close the planned $3.6 billion acquisition of wireless spectrum from several cable giants, including Comcast, by mid-summer.
The process for the spectrum deal is currently "where we expected to be," he said. Asked about opposition to the sale from the likes of T-Mobile USA, Sprint and DirecTV, the Verizon CFO said the company knew who would oppose the transaction, but expressed confidence that it would pass regulatory muster.
Discussing the Redbox partnership, Shammo highlighted that the partner has 35,000 U.S. Redbox kiosks, meaning "a very strong following." Adding in content that Verizon's FiOS video service has deals for will allow the partners to provide an over-the-top video bundle that should provide "a very good growth engine" for his company, he said. "This is really an offensive play, but maybe a defensive play at the same time."
The added content offer will also allow Verizon to have a "major discussion" with content providers about programming costs as it will be able to negotiate based on more reach across different platforms, the Verizon CFO said.
Asked about recurring rumors that competitor AT&T could look to acquire satellite TV giant Dish Network and whether it would change Verizon's need to buy a satellite TV company, Shammo said no. "It doesn't do at all," he said.