BURBANK, Calif., APRIL 12 — Warner Bros Discovery Inc (WBD.O) announced Wednesday that on May 23 it will launch its long-awaited new streaming service, dubbed “Max,” combining entertainment scripted for HBO Max with Discovery shows. realism.
The service will seek to expand its reach beyond fans of hit-and-miss HBO shows by incorporating off-the-cuff fare and kids’ programming.
It will also mine the studio’s rich content library to produce top-tier programming, including a new series based on JK Rowling’s Harry Potter books, and another prequel to the popular fantasy series Game of Thrones.
Warner Bros., Walt Disney Co (DIS.N) and other media companies are seeking to strike the right balance between spending on new programming to attract and retain subscribers and turn a profit.
Shares in Warner Bros Discovery closed down nearly 6%, part of a broader drop in stock flow after critical remarks from famed investor Warren Buffett.
“It’s not really a good business,” Buffett said on CNBC. While people in the entertainment business “make a lot of money, shareholders haven’t done it great over time.”
Buffett is an investor in Paramount Global, which fell 3% on Wednesday. Disney shares fell 2.5% and Netflix 2%.
Max’s new service will serve as a testbed for CEO David Zaslav’s ambition to create one of the world’s premier streaming services by piecing together a collection of disparate assets, from the cooking show Barefoot Contessa to Batman.
“This is our time, this is our chance,” Zaslav said during a presentation held at Studio Warner in Burbank, California. “I feel that for our company, this is our appointment with destiny.”
Max prices range from $9.99 per month for the ad-supported version to $19.99 per month for the “Max Ultimate” for the ad-free tier with four simultaneous streams. The first tier will keep HBO Max’s current $15.99 per month price — a strategy that has won praise from a media analyst.
“By keeping rates the same, except for the new premium class, there’s no reason for anyone to hold back,” said Bank of America media analyst Jessica Reeve-Ehrlich. “For the same price you get multiples of content.”
Zaslav said HBO’s “unique storytelling” will bring subscribers to the service while the unscripted Discovery programming will keep them.
Warner Bros Discovery has dropped “HBO” from the name of its streaming service, which to some viewers connotes dedicated series but alienates others.
“HBO is HBO,” said J.P. Perrett, president of global broadcasting, and “shouldn’t be pushed to the breaking point” by eating the variety of content that HBO and Discovery offer.
“We’re looking to expand on a larger scale,” said Perrett, “and we believe we can compete with the biggest players in the space.”
The service will feature HBO content including several Emmy award-winning drama series “Succession” and hit video series “The Last of Us”.
It will also have several new titles based on popular franchises, including “The Penguin,” a series based on DC Comics Villain, a new comic series spin-off of the popular CBS show “The Big Bang Theory,” and a new installment in The Big Bang Theory. . Fixer Upper home improvement franchise, Fixer Upper: The Hotel.
CEO Zaslav said Warner Bros. films will enjoy a traditional theatrical release and box office revenue before they become available on the streaming service.
The opportunity to better capitalize on the video streaming revolution was one of the justifications for the merger of Discovery and WarnerMedia in 2022.
But by the time the deal closed in April of last year, Wall Street’s enthusiasm for streaming had begun to wane, as Netflix (NFLX.O) reported its first subscriber loss in over a decade. Investors began to prioritize profits over subscriber gains, which led to a new economy throughout Hollywood.
Like other media companies, Warner Bros. Discovery hasn’t turned a profit on streaming services HBO Max and Discovery+, though the company has cut its losses.
It has set a combined goal of 130 million subscribers by 2025, far short of Netflix’s 231 million subscribers.
Additional reporting by Don Chmielewski and Lisa Richwin in Los Angeles and Tyachi Datta in Bengaluru; Editing by Arun Koyoor, Aurora Ellis, and Sonali Paul
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