AT&T CEO suggests Netflix’s price hike is great news for HBO Max

Netflix retains getting costlier — and HBO appears to assume that’s nice information for its personal enterprise. In the course of the earnings name for HBO Max mother or father AT&T on Wednesday, the corporate’s chief govt John Stankey stated the upper worth of opponents will assist HBO develop within the US.

“We stated the market was going to come back to us on pricing, and lo and behold, we’re now not the high-priced supply available in the market,” Stankey stated. “The great half about that’s we expect it’ll enable us to have home development as we transfer ahead.”

Whereas he didn’t particularly cite Netflix, the corporate not too long ago raised its costs throughout all of its plans, bumping its standard normal plan to $15.50 from $14 per thirty days. Its 4K plan, in the meantime, now prices $20 per thirty days. Meaning Netflix now outprices most main on-demand streaming companies available in the market — together with HBO Max, which prices $15 per thirty days or $10 per thirty days with advertisements.

That places HBO Max in a reasonably aggressive place, significantly as Netflix’s cheaper plans lack premium options like assist for 4K included on HBO Max. (Whereas Netflix does have a less expensive $10 plan, Netflix skimps on options like HD and UHD streaming in addition to simultaneous streams on that tier.)

When it comes to its aggressive edge over streaming companies that launched their merchandise at lower cost factors to win over subscribers, Stankey stated these companies are prone to have issue ramping up their common income per person, including, “It’s about being very diligent in including prospects at a moderated tempo.”

The corporate’s home HBO Max and HBO companies are additionally persevering with to rebound following the corporate’s exit from Amazon Prime Channels final yr. By the top of 2021, home subscribers jumped from 45.2 million to 46.8 million, falling simply shy of the 47 home subscribers it had previous to the breakup. Addressing the choice throughout the name, Stankey stated the transfer was useful for the enterprise in the long run.

“On the finish of the day, you need full management of your prospects,” Stankey stated. “These prospects are all going to come back again into the supply — it could take a few quarters for that to occur, however there’ll ultimately be a product on the market that they’re going to take a look at and see they wish to be a part of.”

In the end, HBO Max sees extra worth in having direct entry to its buyer base, significantly to arrange WarnerMedia’s merger with Discovery. It’s higher, Stankey added, “to have them there the place you’ve direct entry, management of them, can market to them, know what they’re doing, than have or not it’s in some black field the place you completely don’t know what any individual else is doing with aggregating your content material and your publicity to the shopper.”

Globally, HBO and HBO Max grew to 74 million subscribers by the top of 2021. AT&T teams the 2 content material arms collectively, so a one-to-one comparability to its streaming rivals is somewhat difficult. However the firm did develop its enterprise by 13 million between HBO and HBO Max from the yr prior, little doubt helped by a yr of straight-to-streaming releases and a brand new ad-supported plan.

It seems like Stankey was proper: HBO Max didn’t want Amazon in any case.