The motivation for continuing to offer Discovery+ as a stand-alone streaming service after a combined offering with HBO Max debuts later this spring, is largely financial, Warner Bros Discovery CEO David Zaslav says.
Word of the decision, which emerged earlier this month, followed months of execs heralding efforts to “harmonize” HBO Max and Discovery+ into a single outlet with an improved interface and more efficient operations. Pricing has been a looming question, however, with Discovery+ costing $5 and $7 a month and HBO Max currently at $10 and $16.
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“The churn is very low and it’s profitable,” Zaslav said of Discovery+ during the company’s fourth-quarter earnings call. “Many of those people are going to want to move up to a bigger product, more robust with a bigger offering. … Our strategy is: ‘No sub left behind.’ We have profitable subscribers that are very happy with the product offering of Discovery+ Plus. Why would we shut that off?”
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Since the merger of WarnerMedia and Discovery last spring, generous helpings of Discovery fare have been showcased on the home screen of HBO Max. Weaving together upmarket scripted titles like The White Lotus and Warner Bros movies with the lifestyle and non-scripted likes of Deadliest Catch and 90-Day Fiancé remains something of a work in progress. The company has not spelled out detailed plans for integrating the two services, promising updates about pricing, content, branding and other aspects at an April 12 press event.
Zaslav emphasized during the call how distinct the viewership is on Discovery+ compared with HBO Max. Discovery+ is heavily viewed — for “hours a day” — but “passively,” he said, and mostly “during the day or in fringe.” HBO Max, by contrast, is watched more by families in the evening.
Like its traditional media peers, WBD has revealed virtually no empirical streaming viewership data. Even subscriber figures are now rolled into a single, blended metric, which includes linear subscribers to HBO.
Zaslav’s comments came after the company delivered a mixed report for the fourth quarter, with results in many categories falling short of Wall Street expectations but streaming showing progress and narrower losses. Free cash flow outdid forecasts and the company insists it is ahead of its own projections for the profitability and reach of its streaming portfolio by 2025.
The last thing I want on HBO Max is more trash like this. Smart move.
So discovery+ is making money. Hbo like most other strangers are not. Why would you tinker with a cash cow. Just call it dicoveryhbo or whatever and then have 3 tiers Hbo only, dic+ or the ultimate package. Personally I think Disney will do something like today sometime.
Makes sense – you have legacy subscribers paying money for content – they aren’t going anywhere and probably aren’t interested in what HBO Max has to offer and then Warner is just repurposing that same content which adds “value” on a more expensive platform .
HBO used to be the best brand. Now when i’m on HBO max, i have to see categories for sh#t Discovery shows. why don’t you just put a button and you can either access HBO max or discovery rather than having them mixed?
Do any of these people who comment on every single one of these articles ever acknowledge that HBO Max was losing billions of dollars? Was such a debacle that AT&T committed fraud (subject of a federal investigation and lawsuit) to inflate HBO Max revenue by counting HBO subscribers – who get the service for free – that never actually used HBO Max?
What is it that you folks want? For someone to continue to lose billions a year by continuing to operate HBO Max like AT&T was? All right, who or what was going to cover these billions in losses? Or perhaps you have some brilliant plan to turn HBO Max profitable that neither AT&T or their new owners could think of? OK, what is it? Because in the months that this meltdown has been going on the only “suggestions” have been to cut the CEO’s pay. That said CEO would resign, get another media job making the same amount of money 5 minutes later and HBO Max’s owners would still have the same problem on their hands – plus no CEO and no one willing to take the job – never gets considered.
Folks, spamming content hoping that it would result in new subscribers and prevent churn was magical thinking. No different from how in the medieval era people thought that storing corn in rooms and then going abra cadabra would produce rodents. But seriously, read The Ankler substack, one of the few outlets left that actually deals with the business side of Hollywood the way that Variety and Entertainment Weekly used to before the former turned to advocacy journalism and the latter became a tabloid (with advocacy journalism). You will see how much money these streamers are losing, and how tiny the viewership of everyone’s favorite shows on Twitter actually is. You will see that all of the shows that were “saved” by going from Netflix to another streamer like the “One Day At A Time” reboot, “Tuca and Bertie”, “Young Justice” etc. got horrible ratings at their new homes and were cancelled within a season or two there also. If the trade journals actually did their jobs and reported how movie attendance, network TV viewership, cable viewership etc. have been in decline for decades – network TV since the late 80s, movies since the late 90s, cable since the 00s – plus the DVD market petered out ages ago meaning the revenue pie has been getting progressively smaller, you wouldn’t have meltdowns like this.
Instead of reacting to for profit businesses cutting profits because of a long term decline in the very viewers that generate the profits, folks should be proposing ideas on how to get viewers back. And by viewers I mean the sort of large mainstream audiences that cuts across multiple demographics that entertainment regularly produced in the 70s and 80s up until some geniuses decided in the mid 90s that going after mainstream audiences was “uncool”, which precipitated this long decline. You had BoJack Horseman parodying the 80s network TV family comedy scene. Real funny, right? Except that Full House, Family Ties and the rest earned huge ratings and generated a ton of cash for everyone involved. Like Hollywood couldn’t use that now. Instead you have the writers going on strike demanding a bigger slice of a pie that they refuse to stop shrinking.
HBO had great shows. I didn’t have nor want traditional cable tv (mostly because of the ads). HBO Now was the first time that I could actually sub and give them money. Loved it! HBO Max sort of messed that up at first but improved. Now it’s not worth subscribing to anymore. Cancelled. If I want to watch trash like that then it can be found for free on YouTube.
You’re complaining that they weren’t after mainstream people anymore but in my opinion it was about accessibility combined with being worth paying for. Mainstream shows are everywhere so they will never be the shows that pull in subs. Niche content pulls in subs and mainstream helps keep them.
Some thoughts using Disney as an example:
1 – Consolidate your networks as best you can. Take Disney Junior, Disney XD and Disney itself and make it one network – Disney or even Disney Family. Eliminate redundancy and repetition by ending marathons of the same five, or so, shows each and every day. Program a block for the little kids in the mornings and, maybe, early afternoons. An older kids block during late mornings and mid-afternoons. A teens, even young adults, block during late afternoons into early evenings.
2 – Get rid of Freeform. Take the teen and young adult programming and find a place on Disney/Disney family for mid to late evenings or an early to mid primetime slot for ABC.
3 – Older or previous season programming can be allowed for a one to two hour weekday block or through late night.
4 – Programming being developed for the streaming services could/should have been developed for Disney or ABC.
5 – End next day streaming. Keep all new network content OFF On Demand, and the like, and OFF any streaming service be it theirs or someone else’s. Air original programming completely through all episodes on whichever network it airs until the season is fully completed. Only after this would the program be placed On Demand and/or on a streaming service. Two choices: a) Make the season’s episodes available through the summer for people to catch up, if need be, or for people who discovered the show late. b) Hold off until the new season, if renewed/continued begins airing before making the previous season available ON Demand and/or through streaming.
6 – Does Disney really need a premium streaming service? Why is there a Plus service and a free (more or less) service called Disney Now? Why hasn’t Now been closed/folded into Plus? Does ABC’s website still stream their shows or is it through Hulu now? Both? If both, why? How about FOX? FXX?
Shouldn’t Disney Plus be a simple studio site with channels for what they own? From my notes above, Marvel and Star Wars stuff could be allocated to whatever network they were to air on. If Disney were to have “The Mandalorian” on ABC, then the ABC channel of Disney Plus can be where to watch it after it has aired on ABC. Or, I suppose, they could have channels for Disney, ABC/ABC Studios, FOX, FXX, Marvel, Star Wars, Pixar, Muppets, and what all else. The point mainly being to consolidate here too by getting rid of (sell) Hulu and Disney Now and direct ABC and FOX website visitors to Disney Plus to watch their respective programs and films just as ABC has a Hulu link.
The only thing possibly going for Hulu right now are its originals, but could they end up elsewhere or would they need to be canceled? Could any end up on ABC or FOX/FXX? I, again, suppose that if Comcast were to buy it out, they could end up with the rights to these shows or are they Disney’s?
That leads us to Comcast/Universal/NBC itself and what hey should do, but I really do not wish to go further down the rabbit hole here with this and other ideas.
“Less is more” and these studios seem to have forgot that, or never learned, and likely never will.
You don’t seem to realize that D+ here means discovery plus not Disney+. And I just agree with everything that you said. As people cut, the cord streaming services are a revenue stream and that Contant gets them to subscribe, so why would Disney not keep it if this were about Disney which it wasn’t? Disney+ only lost money because they invested crap tons of cash in original content They just need to pace it more which is exactly what they’re going to do
People that call for Disney to consolidate Disney channels fail to realize they generate fees each and every month. There are still people that use Dish, DirectTV, and cable, not everyone streams their entertainment. Why would you cut off a steady stream of cash each month. Get rid of Freeform? really think before you post, Freeform generates both ad revenue AND carriage fees for Disney each month. Disney has a problem with ONE Division it’s not ABC, it’s not the Cable channels, it’s called Disney+, they overspent the last few years and released theatrical films without a theatrical run. Look at where Disney generates its income. Even the ESPN channels generate income each month, cable and satellite isn’t dead yet and as stream becomes more splintered and more expensive you might just see viewers say screw it and move back to cable, or something like Dish where you can integrate some of your streaming channels into their system.
hope the cops catch the guy who held a gun to AT&T and Discovery’s heads to make them overpay for something they had no idea how to run
Being mad at rich people won’t solve your own lack of success or money FYI
Simping for rich people won’t make you successful or rich either! :)