Verizon To Buy 'Hulu For The YouTube' Video Startup, Plans To Shut It Down

Verizon Communications Inc. (NYSE: VZ) said on Wednesday it has acquired Vessel, a subscription video service founded by Hulu's former CEO Jason Kilar and former chief technology officer Richard Tom.

Tech Crunch described Vessel as a "sort of Hulu for the YouTube generation." Subscribers pay $2.99 a month for a service that brings together a variety of content into one unique platform.

Vessel's early investors include Amazon.com, Inc. (NASDAQ: AMZN) CEO Jeff Bezos' investment fund Bezos Expeditions. Since 2013, Vessel has raised more than $134 million from investors. Verizon did not say how much it acquired the company for.

According to a Recode report, Verizon is only interested in acquiring the technology that powers Vessel and will shut down the actual service at the end of the month.

Tom will also transition to become the CTO of Verizon's digital entertainment business, including its Go90 mobile video service.

Speaking to Recode, VeriZon Entertainment's general manager Chip Canter said the company plans on merging Vessel's social features with its own already existing content strategy.

The acquisition will also evolve Verizon's media content beyond its free Go90 service and offer its own paid subscriptions and other over-the-top services.