Verizon to Test Streaming Service for Cord-Cutters

Verizon CEO Lowell McAdam says the telecommunications giant may take a page out of AT&T's book — it will be testing its own over-the-top video-streaming service later this year.

AT&T

AT&T

Speaking at the J.P. Morgan Global Technology, Media and Telecom Conference in Boston this week, McAdam said that he plans to use the combined user base of Yahoo and AOL — about 1.3 billion users strong — to test the service, according to a report in Variety. McAdam did not say exactly what the service might offer.

Verizon's stab at the streaming-video market follows AT&T's launch last year of DirecTV Now, which provides the opportunity to stream live and on-demand programming from more than 120 channels. It's available for a starting price of $35 per month and doesn't require a DirecTV subscription.

A slew of other streaming services offer similar options, including Sling TV and Hulu.

More: Best Streaming Video Services

A Bloomberg report earlier this year suggested that Verizon, which owns FiOS TV, was working on a new streaming service that would compete with DirecTV Now and offer dozens of channels. That report said the service would likely be tied to FiOS TV, but like DirecTV Now, would not require a fixed-line or satellite subscription.

A new Verizon service might attract more viewers than the company's existing mobile video streaming offering, Go90. Go90 has had trouble garnering new users and hasn't been the streaming destination Verizon had hoped for.

However, Go90 doesn't have the benefit of leveraging AOL and Yahoo as platforms, as the new streaming service to be tested will. With more than a billion registered users — but likely far fewer active ones — the combined AOL-Yahoo, to be known as Oath, will provide a sizable test market.

Verizon expects to close its Yahoo acquisition next month. Verizon won a $350 million discount on the purchase price after Yahoo disclosed two massive data breaches, and the telecom will buy the once-dominant search giant for $4.5 billion.