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Discussion Starter · #101 ·
‘Fixer Upper’ and Other Magnolia Network Shows Coming to HBO Max in September

My guess is they are moving this garbage to HBO Max to make it seem like it is not garbage.
No, it's because Chip & Joanna Gaines had a problem with their boss at Discovery and wanted to be shifted under HBO chief Casey Bloys. And their Magnolia content is definitely higher-end and glossier than the vast majority of HGTV stuff, so it kinda sorta fits at HBO, I guess.

But I really think this is just a short-term move. Because it looks like Zaslav is taking a hatchet to HBO Max and going to whittle it way down and then stick all of it under an HBO content hub inside of Discovery+.

I'll admit, I had the results of this merger all wrong. (But so did everyone.) I saw HBO Max swallowing Discovery+. Turns out it's probably going to be the other way around. SMH...
 

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Discussion Starter · #103 ·
That is an opinion. And I disagree with it. Everything on the Magnolia Network is trash in my opinion except for the few holdovers from DIY.
Whether you like it or not is one thing (which I don't care about). But the production values and cost to produce most of that Magnolia content are higher than the typical HGTV (and certainly DIY) fare.
 

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Over 74 million subscribers seems to like the service. They would not be subscribing if they didn't like the content.
At this point, the reason they are subscribing may well be inertia and FOMO rather than actually watching programs on the service/plex.
 

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Discussion Starter · #107 ·
Yeah, probably one reason why Zas is willing to largely allow HBO to cannibalize Magnolia, since it's not going so great as a linear channel anyhow. (Lots of cable channel packages lack it, as DIY was never a main-tier channel and Magnolia simply replaced DIY. YouTube TV doesn't have it and it's only part of an optional add-on package with Hulu Live.)
 

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Plus the world isn't so in love with Chip and Joanna Gaines like they once were. Right now about 50% of airtime on their network is old reruns of Fixer Upper. The only time I watch their network is when Maine Cabin Masters, Restoring Galveston, or Barnwood Builders is on. All holdovers from DIY.
 

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Discussion Starter · #110 ·
I think the upshot of all this is that the strategy has shifted from Jason Kilar's bold vision that saw direct-to-consumer streaming as what will inevitably replace cable TV and, to some extent, theatrical movie viewing. He wanted to get on with the transformation and grow HBO Max into something that could compete head-to-head with Netflix as a global force, rapidly grow its subscriber base, and ensure it would be one of the few surviving profitable global general entertainment services left standing when the dust settles in, say, 2026.

But the new chief, David Zaslav, is nearly totally reversing that trajectory. He's pulling back, trying to play it safe, and focusing on maximizing near-term profits to pay down the huge debt load that WBD was saddled with from AT&T (which is, to some extent, understandable). He wants to protect theatrical revenue, VOD/DVD revenue, and linear cable revenue, while maximizing return on direct-to-consumer streaming by combining HBO Max and Discovery+ into a single scaled-back service that focuses on their core brands, and then also launching a FAST app featuring older "rerun" series and movies to maximize ad revenue. As he put it, he's not interested in maximizing subscribers but in maximizing profits. And he'll get there by nickel-and-diming customers and content suppliers/creators. (Consider the fact that he's trashing the completed Batgirl movie, intended to go directly to HBO Max, just to get an immediate tax write-off.)

We'll see what they end up offering us and at what price. But I'm a bit skeptical about Zaslav's prospects. It wouldn't surprise me to see this merger fail, with Warner+HBO ending up sold off to combine with parts or all of NBCUniversal and/or Paramount down the road, leaving Discovery solely focused on their declining linear cable channels and just licensing that content out to third-party streamers as they did before the launch of Discovery+.
 

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Over 74 million subscribers seems to like the service. They would not be subscribing if they didn't like the content.
I'm curious to know how many of those subscribers are like myself that get HBO Max for free either through AT&T or DirecTV?

I hardly ever watch anything on there. Any excitement I had when I first started streaming has completely disappeared. None of the new content is compelling at all and I've watched all the old stuff I want to watch already.

I stream Discovery+ much more often so not surprising they will take over HBO Max and not the other way around. I'm just curious how long before they raise the price on Discovery+ once they do combine HBO Max.
 

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Discussion Starter · #112 ·
I'm curious to know how many of those subscribers are like myself that get HBO Max for free either through AT&T or DirecTV?

I hardly ever watch anything on there. Any excitement I had when I first started streaming has completely disappeared. None of the new content is compelling at all and I've watched all the old stuff I want to watch already.

I stream Discovery+ much more often so not surprising they will take over HBO Max and not the other way around. I'm just curious how long before they raise the price on Discovery+ once they do combine HBO Max.
HBO Max has way more subs than Discovery+. And both services have a fair number of folks getting it free (HBO Max from AT&T, Discovery+ from Verizon and maybe others).

They did say something about phasing in the price increase for existing D+ subs once the combination happens in order to try to retain as many of them as possible as opposed to running a ton off from sticker shock by doing the full price increase in a single month. This suggests to me that their plan really is to use D+ as the vehicle for the combined service which seems crazy to me given how many more subs HBO Max has. I guess they're going to let all those HBO Max folks fall off a cliff and just shut down that app next summer and hope as many as possible sign back up for D+ under whatever brand name it uses at that point.
 

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It does seem risky to combine both services. Existing prices with ads is $9.99 and $4.99. TOTAL: $14.98. Ad-free is $14.99 and $6.99. TOTAL: $21.98. The people that only subscribe to HBO Max, about 50 million people, might just not subscribe at all for example if they subscribe to ad free currently at $14.99 and that price is going to jump to around $21.98 per month because Discovery content is included which is not content they ever wanted. Same for people that only subscribe to Discovery+. They surely won't want to pay more for a service that has HBO if they never wanted HBO. I don't see how they will ever make the price of both services any cheaper than the combined cost right now. That would be a price reduction which is unheard of in today's world. By the time it rolls around in 2023 I can see them wanting $24.99 for the combined service. The smart thing to do would be to keep it as is but that is not what they are planning.

And what happens with the DirecTV Premier package that includes HBO Max. Would it include the new HBO/D+ combined content?
 

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If he was smart.. he’d roll everything into the HBO max app, and make the price the current HBO max price and that’s it.

I’m not convinced what he is planning won’t be to do just that. Create an entirely new app that has discovery and HBO sections similar to how the max app has the dc sections for example now…. And by the time they are ready to shut down the dual apps, have everyone paying the same on both apps…. And then simply upgrade both apps to the one new unified app.

Heck they may start putting both apps content on both apps over time and then roll out a unified app.


He is foolish to run from TV movies… but I don’t actually believe he is. He said he doesn’t see the point in making theatrical budget movies for streaming. And I don’t really disagree with him on that either.

I have a feeling his goal is to make HBO max similar to what HBO always was and was known for. High quality tv and theatrical showings. Not junky movies and tv shows with massive budgets pushed to streaming to try and increase numbers. Massive budgets only for shows like GOT….
 

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Discussion Starter · #115 ·
It does seem risky to combine both services. Existing prices with ads is $9.99 and $4.99. TOTAL: $14.98. Ad-free is $14.99 and $6.99. TOTAL: $21.98. The people that only subscribe to HBO Max, about 50 million people, might just not subscribe at all for example if they subscribe to ad free currently at $14.99 and that price is going to jump to around $21.98 per month because Discovery content is included which is not content they ever wanted. Same for people that only subscribe to Discovery+. They surely won't want to pay more for a service that has HBO if they never wanted HBO. I don't see how they will ever make the price of both services any cheaper than the combined cost right now. That would be a price reduction which is unheard of in today's world. By the time it rolls around in 2023 I can see them wanting $24.99 for the combined service.
Nah, they're smart enough to know that such a service (something that combines the entirety of the current HBO Max and Discovery+) -- without even any live sports or news -- would get very, very few takers at price points of $14.98 with ads and $21.98 ad-free. They still must compete against the significantly more popular Netflix and Disney+ Hulu, both at lower prices.

So if they can't jack up prices significantly, how do they make the combined service more profitable?

First, they shrink the combined content library by taking a lot of the older series and movies and monetizing that stuff separately. Some of it will get licensed out to competing services (e.g. Netflix, Prime Video) but a lot of it will get placed in a new WBD FAST (free ad-supported TV) app which they'll aggressively market. FAST is the biggest growth area in streaming these days and I don't see that changing as economically pinched consumers, especially younger ones to whom all that old content is "new," don't mind watching some ads in exchange for quality content that costs nothing.

Second, they'll lower the cost basis of the new content showcased in the combined service. Zaslav says they're going to "dramatically" increase spending on HBO content. IDK, maybe that's true. But it's also true that HBO won't get theatrical movies as soon, only after they've wrung out every penny possible at the box office, and then on VOD, and then on disc. And we're also not going to see any more straight-to-streaming movies either. I also expect that there will be even less cannibalization of the basic cable nets' current content than we've seen so far (and HBO Max has been much less cannibalistic than Hulu or Peacock). Zas thinks this will help prop up his cable sub numbers but I don't think it will, as cable is a lost cause at this point and the cord-cutting trend just relentlessly continues on.

So while HBO Max was conceived by Warner as their direct-to-consumer replacement for HBO plus their basic cable nets, i.e. their own little mini-bundle, Zas does not see it that way. He sees it much more as a place for relatively new content that is mostly supplemental to the basic cable bundle. Library content will largely shift elsewhere (to their FAST and/or competing SVODs and FASTs), while their basic cable nets focus on live sports, live news, and exclusive premier windows for various popular shows from Discovery personalities.

What I still don't have clarity on is whether the combined service always includes HBO or if it is instead an optional add-on. In the latter scenario, I could imagine the service marketed as "Discovery+ HBO" with the base Discovery+ tier costing maybe $5 with ads or $8 ad-free, and then always ad-free HBO costing an extra $8/mo more on top of that, for totals of $13 and $16.

But if HBO is a non-optional part of the service -- and there's really no reason to think it won't be, based on everything we're heard so far -- then I could see "HBO Discovery" costing $10 or $11 with ads in the non-HBO stuff or $16 for the whole thing ad-free.
 

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Right now both services have around 100 million subscribers. If they do indeed cannibalize HBO Max like in your example exprect that number to decrease dramatically. While their new ad-supported free version of streaming will help it will still lose overall in my opinion. HBO Max is doing pretty well the way it is. If it ain't broke don't fix it. And yet they most surely will.
 

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Are HBO Max streaming subscribers split out separately from HBO MVPD subscribers?

I receive HBO Max as part of my DISH subscription ... I generally watch the content via the channels on DISH (which are not the complete linear lineup). DIRECTV subscribers also receive HBO Max as part of their subscription to the linear satellite channels. They may or may not ever touch the streaming content. HBO Max has been bundled with linear on other MVPDs as well.

If HBO Max is stripped of content (requiring a subscription to the new Time Warner Discovery streaming service) I may not notice (since I have streamed little content separate from the OnDemand library available via the DISH receiver). I have gone directly to HBO Max's service for some content. For subscribers like me, we may never notice any change in HBO Max as long as the major content stays (currently linear movies and produced for HBO content). Losing content I did not know I had access to is not a loss.
 

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Are HBO Max streaming subscribers split out separately from HBO MVPD subscribers?
I would think not. A subscriber is a subscriber no matter where they come from. The more subscribers you can claim the better. Who knows for sure though?

I receive HBO Max as part of my DISH subscription ... I generally watch the content via the channels on DISH (which are not the complete linear lineup). DIRECTV subscribers also receive HBO Max as part of their subscription to the linear satellite channels. They may or may not ever touch the streaming content. HBO Max has been bundled with linear on other MVPDs as well.
I get HBO through DirecTV and am just the opposite. I exclusively watch it on the streaming app on an ATV.

If HBO Max is stripped of content (requiring a subscription to the new Time Warner Discovery streaming service) I may not notice (since I have streamed little content separate from the OnDemand library available via the DISH receiver). I have gone directly to HBO Max's service for some content. For subscribers like me, we may never notice any change in HBO Max as long as the major content stays (currently linear movies and produced for HBO content). Losing content I did not know I had access to is not a loss.
Would you notice if the price goes up because they added content you don't necessarily want (Discovery+)?
 

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Would you notice if the price goes up because they added content you don't necessarily want (Discovery+)?
I expect the via MVPD price to remain the same. Perhaps a minor adjustment but not a huge jump that includes additional content.
 

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Discussion Starter · #120 ·
Are HBO Max streaming subscribers split out separately from HBO MVPD subscribers?

I receive HBO Max as part of my DISH subscription ... I generally watch the content via the channels on DISH (which are not the complete linear lineup). DIRECTV subscribers also receive HBO Max as part of their subscription to the linear satellite channels. They may or may not ever touch the streaming content. HBO Max has been bundled with linear on other MVPDs as well.

If HBO Max is stripped of content (requiring a subscription to the new Time Warner Discovery streaming service) I may not notice (since I have streamed little content separate from the OnDemand library available via the DISH receiver). I have gone directly to HBO Max's service for some content. For subscribers like me, we may never notice any change in HBO Max as long as the major content stays (currently linear movies and produced for HBO content). Losing content I did not know I had access to is not a loss.
At this point, an HBO subscription through any MVPD includes access to the HBO Max app at no additional cost. (In this way, HBO Max replaced the old HBO Go app.) So yes, when they report HBO Max sub numbers, they're including all HBO subs, regardless of how they subscribe, whom they pay through, and whether they've even downloaded the app. Unless you're getting a special deal (e.g. free access via select AT&T plans), you're paying $15/mo for fully ad-free HBO/HBO Max regardless. (Although folks who sign up via the app/website, as opposed to via an MVPD, can pay $10/mo for HBO Max with ads in the non-HBO stuff while the HBO content is still completely ad-free.)

You're missing quite a bit of great content from HBO Max if you only watch HBO linear, which does not feature those Max Originals like Hacks, The Flight Attendant, The Staircase, Peacemaker, Minx, Our Flag Means Death, The Tourist, etc. But you're right that there are still a good number, I'm sure, of HBO MVPD subs who only watch via the linear cable channels and its related VOD platform. So for those folks, all this is much ado about nothing. They may actually even see more new content appear on the HBO linear channels they watch if, as I suspect, some of that money flowing into Max Originals gets diverted into a bigger slate of HBO Originals.
 
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