Warner Bros. says: Discovery It will combine HBO Max and Discovery+ into a single commercially and technically viable platform. But it looks like the giant group will be playing catch-up in broadcast markets outside the US for many years to come.
This is a huge mistake for a group that includes the popular pay-TV brand HBO, which has already started rolling out its HBO Max service directly to the consumer.
The situation is particularly dire in the broader Asia region, which is currently the world’s fastest growing streaming market, but where the new WBD-improved iteration of HBO Max won’t be available for another two years.
“We are planning to launch [HBO Max] Serving sequentially begins in the US next summer. Latin America will follow European markets later this year [currently] JB Perrette, CEO and President of Global Broadcasting and Games for Warner Bros. Discovery, in conference call: A call Thursday, after publishing WBD’s consolidated financial results for the second quarter.
Admitting that the show HBO Max was built on isn’t up to par is heartbreaking. Perette explained on the conference call that HBO Max has “performance and customer issues,” but that it offers a rich set of features. On the other hand, Discovery+ has more limited features, but offers a more robust infrastructure for delivery.
Take pity on consumers in eight markets in Asia, where the HBO Go platform is currently available. They were told that HBO Max would represent a technical upgrade to what is currently on sale.
While the technical issues of the group will certainly be overcome, the time lost and out of the market can only be costly. There are at least two reasons for this.
First, global SVOD growth is already slowing — some markets are already nearing saturation, while the impending recession will cause more consumers to reduce their discretionary spending and potentially reduce the number of sub-videos per household.
The rot has already begun in the UK, with a BARB survey published this week showing a 2% quarterly drop in the number of British households with any SVOD.
Perette says the new WBD/HBO Max aims to be so good that it reduces turbulence. But by the time WBD Max rolls out in some parts, Apple TV+ and Amazon’s Prime Video will have time to fill in geographic gaps in the service’s existing matrix, grow content production studios and gain subscriptions with blockbuster content like “Lord of the Rings: The Rings of Power or “Ted Lasso” and “Severance”.
Indeed, WBD’s goals for the new service are intriguing. It aims to attract 130 million global subscribers by 2025, up from the current 92 million. But that’s compared to Netflix’s 2022 figures of 220 million. Disney+ with 138 million (excluding Hulu and ESPN+); And 65 million quickly built Paramount+.
Armed with Discovery+ technology, a fresh look at the balance between AVOD and SVOD, as well as a wealth of content (Discovery, HBO, Warner Bros. and a huge selection of TV brands covering news, kids and entertainment), there is every reason to believe WBD/HBO Max will come out. swaying. One of the advantages of being late to the party can be that it increases profitability shorter than its top-tier competitors.
“The 2024 launch of new free and paid streaming platforms will potentially allow the company to generate immediate income through major licensing deals and some pockets of growth across theatrical payment channels and brands,” says Vivek Koto, from consultancy Media Partners Asia. It also gives management new time to plan implementation and strategy around technology, content, localization as well as pricing and figure out what their right to play in the region. The focus will always be on trying to achieve scale and monetization in key markets such as Australia, Japan, India and parts of greater Southeast Asia.”
Analyst Claire Enders, founder of Enders Analysis, remains more pessimistic. “The livestream bubble has really exploded,” Enders says. “Netflix’s drop in stock price was a harbinger of all these phenomena – people on Wall Street just don’t believe in it anymore.” Enders adds that there is no longer a place on the top tier, which includes Netflix, Disney+ and Amazon Prime Video.
HBO will continue to do well as a brand thanks to its “Game of Thrones” shows, but not HBO Max, Enders says. “It’s HBO that gets the brand recognition, not HBO Max,” Enders says. See the best prospects of HBO Max in North and Latin America. Europe is different and more entrenched in the pay-TV market thanks to 50% of the audience over the age of 42.
“They will keep the possibility of launch open in these other European markets. When they see that they are building a large audience on pay-TV for ‘House of Dragons,’ for example, and other sub-programs, they will see that this has led to continued value,” he says. Enders.
However, the second cause for concern is that in the interim period leading up to the new service being rolled out, WBD will actually help its competitors by dumping content.
This is already underway.
diverse Realize that significant licensing deals in the Asia Pacific region are being split between local platforms in Australia and Japan and with regional players Amazon and Netflix. In India, their production is split between Prime Video and Disney + Hotstar.
All eight “Harry Potter” films will leave HBO Max as of August 31 and can already be found in the US on Peacock instead. HBO Max has quietly removed six Warner Bros. exclusives. She canceled “Batgirl” in an effort to cut costs.
In Europe, HBO Max is also at risk of alienating content providers. In July, the service abruptly discontinued several of its commissioned originals, including “Detective,” “Lust,” and “Kamikaze.” As Netflix and Amazon ramp up domestic production and fast-growing services like RTL+ have revealed expansion plans, HBO Max’s first announced domestic strategy now looks pretty empty.