You could say Verizon Fios started the hubbub around skinny bundles with its April 2015 launch of Custom TV, the first slimmed-down video package offered by a major multichannel video programming distributor.
But Verizon executive director of content strategy and acquisition Ben Grad, who was in on Custom TV from the beginning, would wonder what all the excitement was about. To him, coming up with what has triggered a flurry of skinny bundle packages from other distributors was just a simple case of giving the people what they want.
“We were listening to our consumers and what we believed our customers were interested in,” Grad said. “We built Custom TV to match their interest and needs.”
While some programmers took exception — ESPN sued Verizon, saying the package, which allowed customers to buy the network as part of a separate sports tier that included Fox Sports for $10 per month — they calmed down later after their networks were included in one of the two new Custom TV plans. Verizon said that after that modification, take rates for the package soared.
While Custom TV may not be as skinny as it once was, Verizon has other innovations up its sleeve. Last year it launched go90, a free short-form video service, and CEO Lowell McAdam has said that “mobility” is the future for the video business. None of that seems to phase Grad, who along with the rest of the Verizon programming team will continue to hammer out deals.
That could mean content agreements for other parts of the company — Verizon purchased AOL in 2015 for $4 billion ,and is in the process of completing a $4 billion buy of Internet search engine Yahoo!.
“The biggest priority for us is leveraging our content relationships to offer growth across the company, not just the 5 million Fios customers or the 102 million Verizon wireless customers,” Grad said.
Grad and the rest of the team will have to do that without one of the best minds in programming, former vice president of content strategy and acquisition Terry Denson, who left Verizon in June. Denson, a former cable executive with Insight Communications, had joined Verizon in 2004 and wasn’t afraid to rattle some cages. Custom TV was developed on his watch; he was one of the first programming executives to say carriage deals should be tied to ratings; and he implemented one of the industry’s first regional sports network surcharges.
No replacement has been named for Denson, and Grad said he and the Verizon programming team are continuing as they always had. The innovation pipeline is still humming with the customer in mind, he added.
“Ultimately I don’t know if there is a one-size-fits-all approach for consumers,” Grad said. “Some consumers are happy with the traditional bundle and some consumers are looking for something more like what we have with Custom TV. I think some consumers are looking at the proliferation of direct-to-consumer offerings, and they’re building their own bundle but going with traditional broadband. [And] we see things like 5G on the horizon; that opens up some additional options for consumers.”