The intrigue surrounding the mysterious merger plans for major Warner Bros. Discovery streaming services, HBO Max and Discovery+, has certainly livened up the dog days of summer for industry pundits, trade publications like ours, and the entertainment industry in general.
Speculation circulated after WBD confirmed its plans to merge services in April how That would peak in the weeks leading up to Thursday’s (Aug. 4) second-quarter earnings report and accompanying call from investors. Some rumors predicted the quick and evil evisceration of the team at HBO Max, with the microscope specially trained on the streamer’s unscripted department given Discovery+’s focus on unscripted. For a while it was the most talked about topic in the industry.
And then bat girl happened.
The decision to shelve a near-completed film that had already garnered a $90 million bill — a film no less aimed at a fiercely loyal and vocal fanbase — managed to turn the industry around for a select few from the HBO Max/ Discovery+ fusion ball distracting moments. But even in the days leading up to yesterday’s news, the forecast for HBO Max was very bleak, according to most cited (albeit uncredited) sources.
As we now see, the truth is somewhat different. While much remains unclear, the strategy elements laid out during the earnings call with WBD topper David Zaslav and streaming boss JB Perrette have provided some clarity on the combined streamer’s launch timeline and other aspects of the game plan. While much remains unanswered and more details are promised for the investors’ conference later this year, here are some key takeaways from yesterday’s events that are particularly relevant to the unscripted content business.
HBO Max’s death has been greatly exaggerated…
Judging from some speculation in the press leading up to the Q2 report, one would be forgiven for believing that the plug was This about to be dragged onto HBO Max, a on CNN+. But the news, which broke earlier yesterday, concerned plans to sell content from Magnolia Network – the JV between lifestyle moguls Chip and Joanna Gaines and Discovery, which is now overseen by HBO/HBO Max content head Casey Bloys – Moving to HBO Max via a special “Spotlight page” over the next few months showed that such a drastic move was nowhere in sight. Magnolia content will continue to appear on Discovery+ and the latest version of fixer above Franchise will debut on both platforms, but bringing the Gaines train to HBO Max perhaps heralds more gradual efforts to merge WBD’s streaming brands.
The fact remains, however, that what subscribers currently see as HBO Max and Discovery+ will be a different beast once the combined service emerges. During the investor call, Perrette laid out the timeline for the launch of the yet-unnamed service, with a focus on markets where HBO Max has already launched – leaving territories like the UK, Germany and Italy out of the picture by 2025, with a US launch is planned for summer 2023, LatAm to follow and the European territories and the Asia-Pacific markets are planned for 2024.
“There is still a lot of work to be done in the coming months, from upgrading the technical platform to enabling proper ingestion of content and metadata around the world to ensuring a seamless customer migration at launch,” said Perrette. “There’s a lot to do and we’re committed to getting it right, which will take a bit of time.”
…but what will the new service look like and who will be there?
Perrette (pictured above) added that WBD expects “this year to see peak EBITDA losses for the DTC segment in 2022 as we do the heavy lifting in terms of technology, provide personnel and integration”.
Here remains some of the ambiguity most relevant to the manufacturing community, particularly in the human resources area. In discussing WBD’s “unmatched depth and breadth of content.” [which] gives us the opportunity to offer something for everyone,” Perrette highlighted the “unique and complementary” elements of both streamers, with a clear distinction between HBO Max’s scripted offerings and Discovery+’s focus on “real-life entertainment.” When it came to highlighting the “leading unscripted programming” on offer from WBD, it was Discovery+ content – 90 day fiance and fixer above – that brought the shouts of the top leadership.
Given that, could the content-sharing strategy seen in Magnolia Network/HBO Max news unveiled Thursday — as well as the side-by-side transfer of select CNN originals to Discovery+ also announced yesterday — be expanded to allow HBO Max unscripted and unscripted originals making their way to Discovery+ in the coming months to introduce Discovery+ viewers to HBO Max’s diverse non-fiction offerings? And with reports of “purchase pauses” and development uncertainties affecting both streamers, when is the foot off the brake and who will be driving the development and purchase efforts?
“The majority of people on Casey [Bloys]The team from has been locked up,” Zaslav said in reference to what he called “the incredible success” that HBO and HBO Max are having right now. “Casey is here for the next five years and we hope it lasts even longer.”
Linear is still important
While the majority of attention has been focused on WBD’s streaming and theatrical models, there has also been a lot of movement on the linear front for the company, with significant departures from executives across WBD’s network portfolio raising similar questions about how Unscripted has across WBD will look cable directory. During the results conference call, Zaslav emphasized that achieving content balance across linear networks is as important as ever.
“We think it’s very hard to predict, but we anticipate it’s going to be a very significant cash generator for us and a very good deal for us for many, many years,” Zaslav said of the linear offering WBD, adding that due to the size and breadth of the libraries under the WBD umbrella, the content sharing strategy is also being explored for cable and premium pay TV.
“We haven’t started to implement the libraries that we have now where we could ingest content [like] old crime documentaries from HBO and put them on ID, or take programs that are in the library and broadcast them to any of the cable channels or vice versa,” said Zaslav.