Targeted ads to drive mobile video business, Verizon CFO says

Verizon Communications's upcoming mobile video service will drive revenue with a combination of highly targeted ads, exclusive content and pay-per-view live concerts and sporting events, Chief Financial Officer Fran Shammo said. Most Americans own a mobile phone and Verizon is looking at offering video content to increase data consumption on mobile devices and grow revenue. The digital video service, which it expects to release summer 2015, is aimed at families and younger viewers who increasingly view content on mobile devices.

The new service will be Verizon's first foray into mobile video. Companies from Netflix to Dish already offer Web-based video services, but the No. 1 US wireless company has taken a different approach with an ad-supported business model and short-form programming for mobile devices. The video service will be offered through a mobile app, and will include some free sponsored content, Shammo said. "A sponsored data model down the road... that will generate the usage and the eyeballs that are very appealing to advertisers," Shammo added. In June, Verizon acquired AOL Inc. for $4.4 billion, making a bet that a push into mobile video and targeted advertising can help it unlock new revenue. Shammo confirmed that the company will use its own rich trove of data on 100 million customers to target ads with the AOL technology.