AT&T may not want HBO Max anymore, but the streaming platform is gaining traction with customers.
HBO and HBO Max, home to genre-bending franchises such as “Game of Thrones” and “The Sopranos” and Hollywood blockbusters like “Wonder Woman 1984,” have added 10.7 million customers in a little over a year, with 2.8 million coming in the three months ending in June, AT&T reported on Thursday. Those figures include both HBO Max and the HBO TV channel.
The company has 67.5 million subscribers to HBO and HBO Max, with 47 million in the United States. AT&T, which has struck a deal to sell its media businesses, expects HBO and HBO Max will have between 70 million and 73 million customers by the end of the year, exceeding earlier predictions.
Netflix, the most popular streaming service, has 209 million subscribers, with about 66 million in the United States. It gained customers in the second quarter, but growth has considerably slowed and it lost 430,000 subscribers across the United States and Canada, a sign that cracks are beginning to show in the streamer’s long-held dominance.
Speaking on the broader streaming industry, Jason Kilar, the chief executive of AT&T’s media arm, WarnerMedia, said in an interview: “The only thing I can promise you is change. There is no doubt that change is coming, and that’s appropriate because we live in a dynamic time.”
WarnerMedia, which includes CNN, the Warner Bros. film and television studios and the Turner cable networks, is about to become the property of Discovery Inc., as media companies continue to gobble each other up in an effort to take on Amazon, Apple, Facebook and Google. The deal, which is expected to close around the middle of next year, will create the second-largest media business in the United States, behind the Walt Disney Company and ahead of Netflix and NBCUniversal.
Mr. Kilar, who learned of the acquisition only weeks before it would be announced, could be out of a job after the deal closes.
Both companies are prohibited from working together until the merger is approved by government regulators, including striking any employment agreements. Still, such deals often involve tacit arrangements about leadership. Mr. Kilar said that he had met socially with David Zaslav, the head of Discovery, but that he hadn’t broached the topic of his employment.
“David and I have known each other for a long time,” he said, “and I think it’s fair to say there’s a lot of shared respect between the both of us.”
Mr. Kilar, who took charge of the company only 15 months ago, said he did not have plans to step away.
“There will be a point where I pick my head up next year where I think about this topic,” he continued. “But I certainly don’t intend to do it until 2022.”
Mr. Kilar, who was the founding chief executive of Hulu, is considered within Hollywood to be a bit of an iconoclast. In 2011, he broadsided the industry with a now-famous manifesto on the future of entertainment that, to many, came across as a blistering critique of Hulu’s corporate ownership.
The post panned traditional TV for running far too many commercials. Mr. Kilar also blasted cable, predicting that viewers would eventually drop expensive packages.
After Mr. Kilar joined WarnerMedia, he quickly shuffled the executive ranks and cut costs in an effort to streamline the business.
Then he angered Hollywood (again) by breaking with tradition and releasing the entire 2021 lineup of Warner Bros. films on HBO Max on the same day they were scheduled to appear in theaters. The move would have cost some of Hollywood’s biggest players back-end profits — the commission that top-flight producers and stars earn based on box office receipts — but the company quickly worked out deals to make sure they would be paid.
Unlike Netflix, Disney+ and HBO Max and other new entrants into streaming have legacy agreements with cable distributors and Hollywood studios that prevent a more full-throated approach to making films and TV shows immediately available online.
For Mr. Kilar, the move wasn’t about upsetting Hollywood, but rather was part of a larger strategy to goose HBO Max.
It seems to have worked. The release of made-for-the-big-screen spectacles like “Godzilla vs. Kong” on HBO Max helped to increase the service’s customer rolls.
Mr. Kilar intends to keep up that strategy through 2022. Warner Bros. will release 10 films exclusively for the streaming platform. And big-budget films like “The Batman,” a reimagining of the comic book character starring Robert Pattinson, will have relatively short windows in theaters of 45 days before they show up on HBO Max, according to Mr. Kilar.
“That’s very, very different than the way the world operated in 2019,” he said. “Ultimately, I do think that as long as you’re thoughtful about it, change could be very, very good for not only the customers but also the people we get to work with.”
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HBO and HBO Max Subscribers Seen Reaching 73 Million in 2021 - The New York Times
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