Standalone prestige brand shifts towards being a key cog in new streaming service
It still isn’t TV, but it may no longer be HBO.
AT&T is betting that the HBO name can compete in the streaming space by placing “Game of Thrones” alongside the Loony Tunes, “The Big Bang Theory” and Batman. But does AT&T risk diluting what was one of the strongest brands in all of television?
“We are competing in the ‘full-service category’ with a breadth and depth of content for the whole household. But we do not intend to be a super store,” argues Kevin Reilly, chief content officer, HBO Max. “The launches of Apple and Disney reinforced the value of brand recognition, and we’re glad that the brand promise of HBO and history of Warner Brothers is tied to our Max offering.”
WarnerMedia has spent the past few weeks cutting distribution deals with virtually every major TV provider and digital streaming provider to give their customers that are already paying for HBO an easy access point into Max — for no additional cost. Analysts argue that by doing this, AT&T is essentially signaling to every HBO subscriber that HBO, by itself, is no longer the crown jewel.
“HBO Max seems to be positioning itself as a more general and all-purpose brand,” said Omdia analyst Sarah Henschel. “Just recently, John Stankey also re-affirmed that the brand will continue to evolve to a hybrid advertising model. This further signifies the shift from high-end ad-free content to a general, all-inclusive service.”
HBO has some 35 million subscribers — with 10 million of those also being AT&T customers — which will give HBO Max a good head start. That’s why it’s making it very easy for HBO customers to simply switch over to HBO Max. But that has also caused a bit of confusion over what it means to still pay for HBO the TV channel, and the fate of its first direct-to-consumer streaming option, HBO Now.
“There’s tens of millions of people in the U.S. that already subscribe to an HBO branded service. That’s a good thing. Now, the challenging thing that those are three different phrases [including HBO Max],” new WarnerMedia CEO Jason Kilar told TheWrap. “Might it be better if there were just one flavor in terms of a brand? I think that what will happen over time, and it’s going to take time to get to a world where there is that simplicity, where you’re talking about one brand — and it’s HBO Max. There will be a simplification there that’s going to be better for customers.”
When AT&T first took over HBO in 2018, John Stankey sounded the alarm that HBO would have to go bigger and broader, which caused consternation among Hollywood that HBO’s prestige brand would become watered down — those fears were raised even further when longtime HBO CEO Richard Plepler left. But despite Stankey and HBO programming chief Casey Bloys promising that nothing would change with HBO, it’s clear that AT&T is tying HBO Max at the hip to its celebrated brand.
HBO has been the envy of the TV industry, winning Emmys and being synonymous with the words “prestige television.” Under Plepler’s leadership, HBO bagged a whopping 160 Emmys as the pay cable network climbed to the top of the industry. During Plepler’s tenure, HBO greenlit critically-acclaimed hit series like “Game of Thrones” and “Veep.”
But in the new streaming world, that may no longer be enough. The trick will to be to convince consumers, amid a massive economic downturn, who aren’t already fans of John Oliver or “Succession” to pay up for the priciest option in streaming.
“It’s not enough for them just to convert their existing subscribers to HBO Max,” said analyst Craig Moffett. “They’ll have to grow the pie. And by quite a lot, actually, since the very premise of HBO Max is that it will take what is best not only from HBO, but also from Turner and the Warner Brothers Studio. 1 plus 1 plus 1 can’t just add up to 1.”
Sean Burch and Trey Williams contributed to this story