Warner Bros. Discovery announced Wednesday that HBO Max is launching its long-awaited new streaming service, called Max, which combines scripted entertainment and Discovery reality shows.
The service is trying to expand its reach beyond fans of HBO’s popular and cutting-edge shows by adding unscripted fare and children’s programming.
It will also use the studio’s rich content library to create high-profile programming, including a new series based on author JK Rowling’s Harry Potter books and another prequel to the popular fantasy series Game of Thrones.
Warner Bros., Walt Disney and other media companies are trying to strike the right balance between spending on new shows to attract and retain subscribers and making a profit.
Warner Bros. Shares of Discovery closed down nearly 6%, part of a broader decline in streaming stocks following critical remarks from well-known investor Warren Buffett.
“It’s not a very good deal,” Buffett told CNBC. People in the entertainment industry “made a lot of money, but shareholders didn’t do well over time.”
Buffett is an investor in Paramount Global, which fell 3% on Wednesday. Disney fell 2.5%, Netflix fell 2%.
The new Max service will be a test of CEO David Zaslav’s ambition to build the world’s leading streaming service by assembling a diverse collection of assets, from the Barefoot Contessa cooking show to Batman.
“This is our moment, this is our opportunity,” Zaslav said during a presentation at Warner Studios in Burbank, California. “I like our business, it’s our destiny meeting.”
Pricing for Max ranges from $9.99 (approx. Rs. 820) per month for the ad-supported version to $19.99 (approx. Rs. 1,640) per month for “Max Ultimate,” an ad-free tier with four simultaneous streams. Tier One will keep HBO Max priced at $15.99 (roughly Rs. 1,310) per month — a strategy that has won praise from media analysts.
“With the exception of the new premium level, there’s no reason for anyone to give up by keeping prices the same,” said Jessica Reif Ehrlich, media analyst at Bank of America. “You get more content for the same price.”
Zaslav said HBO’s “unique storytelling” brings subscribers to the service, while Discovery’s unscripted programming keeps them.
Warner Bros. Discovery has dropped “HBO” from the streaming service’s name, which sounds like a made-to-order series to some viewers but puts off others.
“HBO is HBO” and it shouldn’t be “pushed to the breaking point” by supporting a wide range of HBO and Discovery content, said global streaming chief JB Perrett.
“We’re trying to go the extra mile,” Perret said, “and we believe we can compete with the biggest players in the space.”
The service will feature HBO content, including several Emmy-winning drama series and the hit video game adaptation The Last of Us.
New names
It also includes several new titles based on popular franchises, including The Penguin, a series based on the DC Comics villain, The Big Bang Theory, a new comedy spin-off from the hit CBS show, and a new episode of Fixer Upper. home improvement. franchise, Fixer Upper: Hotel.
CEO Zaslav Warner Bros. said that its films enjoy a traditional theatrical release and collect box office revenue before they become available on a streaming service.
The ability to better take advantage of the streaming video revolution was one of the rationales behind the 2022 merger between Discovery and WarnerMedia.
But when the deal closed in April of last year, Wall Street’s enthusiasm for streaming began to wane as Netflix reported its first subscriber loss in more than a decade. Investors have ushered in a new frugality in Hollywood, prioritizing profits over subscriber revenue.
Like other media companies, Warner Bros. Discovery also has yet to make a profit on its HBO Max and Discovery+ streaming services, although the company has cut losses.
It will reach 130 million subscribers by 2025, far below Netflix’s 231 million subscribers.
© Thomson Reuters 2023
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