Verizon's Oath signs distribution deal with Samsung

(Reuters) - Verizon Communications Inc’s Oath Inc subsidiary has signed a deal to place four of its most popular apps on millions of Samsung devices across the U.S. and eventually globally, the company told Reuters on Tuesday.

FILE PHOTO: The Verizon store in Superior, Colorado, U.S., July 27, 2017. REUTERS/Rick Wilking/File Photo

Under the terms of the deal, Oath’s Newsroom app, Yahoo Sports, Yahoo Finance and Go90 mobile video apps will be pre-populated on all Verizon Samsung Galaxy S9 and S9+ devices.

Oath’s deal with Samsung is part of an effort to get its content and partners’ ads in front of the growing number of TV viewers watching their favorite shows on mobile devices instead of through cable and satellite television, Oath’s chief executive officer, Tim Armstrong, told Reuters.

“The amount of content consumption on phones is continuing to skyrocket and I think brands and consumers want more high quality content,” Armstrong said.

The number of viewers who watch video on smartphones is expected to jump 8 percent by 2020 to 196.4 million, according to research firm eMarketer. Meanwhile, the number of TV watchers is expected to decrease more than half a percentage point to 295.9 million over the same period.

The agreement will also allow advertisers to place “native ads,” or advertisements that blend in with the content where they appear, within Oath’s apps as well as Samsung’s Galaxy app.

“This gets ads one step closer to being direct to consumer,” Armstrong said. “You can’t be more direct than being on the mobile phone home screen and app environment.”

Samsung and Oath will share ad revenue, Armstrong said, declining to comment on the terms of the deal.

Nine-month-old Oath was created after Verizon bought Yahoo and merged it with AOL. Oath plans to announce its deal with Samsung as part of its presentation to media buyers in New York Tuesday evening, outlining its strategy for the year.

(This story corrects second paragraph to say deal only applies to Samsung Galaxy S9 and S9+ devices with Verizon.)

Reporting by Jessica Toonkel; Editing by Leslie Adler and Diane Craft