The chief executive of WarnerMedia says the company's HBO Max streaming service "broke through" in 2021 and has earned a seat with Disney and Netflix as the leaders of the streaming wars – even as it lags behind by tens of millions of subscribers.
"It's fair to say it's becoming a three-horse race at the front of the pack," Jason Kilar told the FT. "With regards to storytelling . . . and when you look at the US subscriber numbers, things drop off a fair bit after the first three courses."
The company last week reported it had reached 74 million subscribers to HBO Max and HBO by the end of 2021, up from 61 million in 2020. People who pay for HBO's television channel have access to the streaming service for free.
Despite Mr Kilar’s enthusiasm, HBO Max is still well behind Netflix and Disney, which reported 214 million and 118 million subscribers, respectively, at the start of October.
Warner’s numbers also come with a caveat: the 74 million includes people who pay for HBO’s cable channel. The company has been encouraging these customers to sign up for HBO Max, which they get for free. Mr Kilar said the “vast majority” of the 74 million are using HBO Max, but declined to provide specifics.
The company has added 13 million subscribers in the past year, helped by a slate of programming including new seasons of Succession and Insecure, as well as a bold strategy to release all Warner Bros films to HBO Max for no additional fee.
Disney Plus's 118 million in October was up by 44 million subscribers from a year earlier – a much faster pace of growth. However, Disney's service costs considerably less than HBO Max and was boosted by a push into India, where subscribers pay less than a dollar a month.
Mr Kilar said Warner would invest more than $18 billion on content this year as it looks to keep pace with rivals. Disney and Netflix are expected to spend more than $33 billion and $17 billion each in 2022.
WarnerMedia is set for its second change in ownership in three years. AT&T in May agreed to spin off and combine WarnerMedia with rival Discovery, just three years after acquiring the company, a humbling retreat from Hollywood for the telecom company. – Copyright The Financial Times Limited 2022