When it comes to the ongoing streaming wars, another one bites the dust. Well, sort of.
HBO Max isn’t quite dead yet, but it’s basically on the chopping block. And hey, so is Discovery+. In 2023, both HBO Max and Discovery+ are getting replaced with a single new service. Sorry, HBO fans!
The Merger That Is Spelling the End for HBO Max
Okay, let’s back up for a second. HBO Max was started by WarnerMedia after AT&T acquired the conglomerate in 2018. Discovery’s streaming service, Discovery+, was launched in the U.S. just a little over a year ago. These platforms joined a multitude of already-existing streaming services, which were already at war for subscribers. The big ones (aka Netflix, Prime Video, Hulu, and now Disney+) were probably laughing–at least until WarnerMedia started pulling its shows and movies from other services.
It seemed strange to me that AT&T, the telecommunications company with fiber internet and mobile phones, was suddenly in the entertainment biz. I guess it seemed weird to them, too, because they decided they didn’t want to do it anymore. They have opted to focus on their wireless stuff, which is probably good news for their mobile customers. Along came a merger between WarnerMedia and Discovery. The deal closed in April of this year, leaving us with Warner Bros. Discovery Inc.
That meant new management for HBO Max, and the new management had new ideas about what HBO Max should be. Or, perhaps what it shouldn’t be.
New CEO Decided to Cancel Nearly Finished Projects
In a shocking movie, Warner Bros. Discovery decided to ax nearly finished products, like Batgirl and Scoob!: Holiday Haunt, that were destined for the streaming service.
Filming for Batgirl had reportedly wrapped, and the DC film was expected to arrive on HBO Max this year. In the Heights star Leslie Grace was cast in the title role, with Michael Keaton donning the Batsuit for the first time in 30 years. And none other than Brendan Fraser was to star in the film as a sociopathic pyromaniac supervillain! (I will literally pay for the unreleased movie just to see that.)
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Batgirl was budgeted at around $80 million, but costs reportedly went to $90 million amid COVID-19 protocols.
Scoob!: Holiday Haunt was an animated prequel to Scoob! While its predecessor hit theaters and streaming simultaneously, Holiday Haunt was set for a streaming release only. It featured voices from the likes of Will Forte, Mark Wahlberg, Gina Rodriguez, Zac Efron, Amanda Seyfried, Tracy Morgan, and even Henry Winkler. The comedy was already “95% complete,” according to co-writer Paul Dini.
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This one cost less than Batgirl at around $40 million, but that’s still a solid chunk of change for a streaming exclusive.
New Warner Bros. Discovery CEO David Zaslav is apparently gunning to refocus the company on theatrical films rather than projects destined for streaming. And Zaslav didn’t think Scoob! or Batgirl were theatrical prospects. With no place in the company’s new distribution plans, out they went. It appears that Warner Bros. Discovery is just going to eat $130 million with nothing to show for it.
But Zaslav isn’t done yet. It seems that the company is prepared to cancel HBO Max, too!
New Platform Coming Next Year Will Combine Content
While Zaslav and team are busy pinching pennies, they’ve decided that HBO Max and Discovery+ won’t make it past next year. The content from the two streaming services will be combined into one single service. It is expected to launch in the summer of 2023.
In reality, it seems like kind of a smart move. With the consolidation of all that content – from Food Network to HBO, HGTV and TNT – it seems like there will be a little bit of something for everyone. You can watch both The Secret of Skinwalker Ranch and the Harry Potter franchise without ever leaving the service.
This could position the new combined streaming service from Warner Bros. Discovery to rival the big ones. Currently, there are 76.8 million subscribers worldwide tuning into HBO and HBO Max combined, while Discovery+ has 24 million subscribers.
Compare that to Netflix’s 220.67 million worldwide. And, that’s after the streaming giant reported a huge loss of subscribers this year. I’m talking about losing 200,000 in the first three months of 2022, and another 1 million subscribers by July.
Amazon reported that more than 200 million Prime members worldwide streamed shows and movies last year. I’m sure that most subscribers are mostly hanging around for the free two-day shipping… But hey, they’re still streaming content so it counts.
The number of Disney+ subscribers continues to climb, too. They’re looking at 137.7 million subscribers worldwide.
Are There Too Many Streaming Services for Consumers to Choose From?
What does all of this mean for the ongoing streaming wars?
There are a lot of options out there. If you ask me, there are too many options.
Options are a good thing. As consumers, we all like to have choices. Streaming platforms offered an alternative to bloated, old-fashioned cable packages.
They’re starting to feel like good ol’ regular cable channels, though. In order to watch everything you want, you might end up paying cable prices, too. I don’t know that I could even name all of the available streaming subscriptions out there. That’s because every big media company has spent the last few years scrambling to remain profitable in the post-cable TV world.
Do you subscribe to Netflix or Hulu? Is Paramount+ worth your time, or do you need Peacock to get your Office fix? I’m sure Apple TV+ has… some kind of programming. And even all those premium channels from back in the day have joined the war, with Starz, Epix Now, and Showtime all dropping their own streaming services.
What’s In the Future for All These Platforms?
Does the new merging of HBO Max and Discovery+ spell out a new future for streaming services?
We already know that Disney is now the majority owner of Hulu, so they’ve got their hands in two cookie jars already. They have also already started to combine their services somewhat, with Hulu’s bundle that includes Disney+ and ESPN+ for a single cost. And if you’re a Hulu + Live TV subscriber like me, it comes with Disney+ and ESPN+.
Comcast’s NBCUniversal still holds a minority stake in Hulu, but they’ve pulled most of their content for their own streaming service, Peacock. They’ve also reached an agreement for Disney to purchase the remaining 33% stake in the company as early as 2024.
It’s hard to say if we will see these three separate subscriptions eventually merge into one. I’d say it’s definitely a possibility, though. I would imagine that offering a single streaming service is a lot more cost-effective than running three separate ones.
And that right there is probably pretty important to Warner Bros. Discovery right now. After the merger was completed, they were starting off with $55 billion or so in debt. That’s why CEO Zaslav is so intent on pinching pennies and revamping the company’s direction.
Who Is Really Winning the Streaming Wars?
So on the surface, it may seem like HBO Max is losing the streaming wars. In fact, some are asking if all of this is marking the end of the battle, or even the end of streaming in general. (Just for the record, I don’t think streaming is ever going away at this point.) This is probably because they aren’t looking at the big picture. Sure, HBO Max canceled two nearly-complete projects, some content has been pulled off the platform, and it won’t exist as it is come next year. It sure seems like HBO Max is just another casualty of the new media landscape.
But really, I think they’re just playing a strategic long game by merging with another service. By amping up the variety of content offered, they’re looking at appealing to more audiences – something that Netflix and Hulu have already perfected.
I think we all know that the war is going to continue for quite some time. It will be interesting to see what happens to some of the smaller platforms and how many more mergers we see moving forward.
As for now, Netflix is still very clearly on top, despite losing an astronomical number of subscribers already this year. Disney+ is hot on the trail, and their bundling option with Hulu and ESPN+ can certainly help them close the gap.
However, keep an eye on what Warner Bros. Discovery does in the future. Their new service next year may gain some serious subscriber numbers moving forward. Do I think they will snatch the crown that Netflix currently holds? Well, probably not. But I do think they are poised to become a big competitor.