AT&T CFO Has No Regrets About HBO Max Film Release Strategy: ‘Real Success With It So Far’

Warner Bros. is four movies into its year-long experiment

Judas and the Black Messiah Daniel Kaluuya
"Judas and the Black Messiah" / Warner Bros.

AT&T seems pretty pleased with how its experiment of releasing new Warner Bros. movies in theaters and on HBO Max has gone so far, which has been mostly to the benefit of its young streaming service.

“What we’ve seen is not only good viewership of those movies on HBO Max, but engagement that followed, that’s been encouraging. So real success with it so far,” AT&T CFO John Stephens said Monday during the virtual Deutsch Bank Media, Internet and Telecom Conference. “We think it’s worked out well for all involved.”

So far, four Warner Bros. films have been released simultaneously in theaters and on HBO Max: “Wonder Woman 1984,” “The Little Things,” “Judas and the Black Messiah” and “Tom & Jerry,” with “Godzilla vs Kong” next up on March 31.

Warner Bros. took a ton of heat from Hollywood, particularly from director Chris Nolan and the studio Legendary, which produced “Dune” and “Godzilla vs Kong” (Legendary has no benefit from HBO Max getting subscribers, after all). But unlike its other studio rivals, Warner Bros. has at least been able to put movies out, and support whichever theaters have remained open.

“Wonder Woman” topped fellow Christmas Day release “Soul” on Disney+ with 2.3 billion minutes viewed, per Nielsen’s streaming ratings, and led to more consumers trying out HBO Max. “Judas and the Black Messiah” has become a heavy favorite to land a bunch of Oscar nominations next week, having already bagged a trophies elsewhere, including Daniel Kaluuya’s Golden Globe win.

“If you just hold all those for later release, you’re going to be in a position where all the studios have been holding movies and the flood at the theaters, even if they’re fully open, would change all the economics anyway,” Stephens argued. Earlier in the conversation, he noted that even though more theaters, including those in New York, are reopening, there’s an assumed “expectation that reopening would be gradual.”

One of the likely long-term impacts from the pandemic is a permanent shrinking of the 90-day theatrical window. Though Warner Bros. dissolved it completely in a one-year test run, Universal now has the chance to pull its films from theaters after 17 days under certain circumstances, while Paramount will yank its films after 45 days to make them available on the Paramount+ streaming service.

“We’re still just a few, three or four months, into this process. And so we’re still learning from it, we’re still gathering data,” Stephens continued. “We’re still uncertain as to when the economy is going to be fully open. So I wouldn’t suggest anything other than what we’ve announced: That this was a one-year effort. But we’ll be we’ll be very thoughtful.”

HBO and HBO Max combined for 41.5 million subscribers at the end of 2020. That is two years ahead of WarnerMedia’s publicly shared schedule. AT&T’s next quarterly results will give us a better idea as to how many new subscribers this experiment is turning out.


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