Discovery+ Economics Justify Continuing It As A Stand-Alone Streamer After Launch Of Merged HBO Max Offering, WBD CEO David Zaslav Says: “Why Would We Shut That Off?”

The motivation for continuing to offer Discovery+ as a stand-alone streaming service after a combined offering with HBO Max debuts later this spring, is largely financial, Warner Bros Discovery CEO David Zaslav says.

Word of the decision, which emerged earlier this month, followed months of execs heralding efforts to “harmonize” HBO Max and Discovery+ into a single outlet with an improved interface and more efficient operations. Pricing has been a looming question, however, with Discovery+ costing $5 and $7 a month and HBO Max currently at $10 and $16.

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“The churn is very low and it’s profitable,” Zaslav said of Discovery+ during the company’s fourth-quarter earnings call. “Many of those people are going to want to move up to a bigger product, more robust with a bigger offering. … Our strategy is: ‘No sub left behind.’ We have profitable subscribers that are very happy with the product offering of Discovery+ Plus. Why would we shut that off?”

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Since the merger of WarnerMedia and Discovery last spring, generous helpings of Discovery fare have been showcased on the home screen of HBO Max. Weaving together upmarket scripted titles like The White Lotus and Warner Bros movies with the lifestyle and non-scripted likes of Deadliest Catch and 90-Day Fiancé remains something of a work in progress. The company has not spelled out detailed plans for integrating the two services, promising updates about pricing, content, branding and other aspects at an April 12 press event.

Zaslav emphasized during the call how distinct the viewership is on Discovery+ compared with HBO Max. Discovery+ is heavily viewed — for “hours a day” — but “passively,” he said, and mostly “during the day or in fringe.” HBO Max, by contrast, is watched more by families in the evening.

Like its traditional media peers, WBD has revealed virtually no empirical streaming viewership data. Even subscriber figures are now rolled into a single, blended metric, which includes linear subscribers to HBO.

Zaslav’s comments came after the company delivered a mixed report for the fourth quarter, with results in many categories falling short of Wall Street expectations but streaming showing progress and narrower losses. Free cash flow outdid forecasts and the company insists it is ahead of its own projections for the profitability and reach of its streaming portfolio by 2025.

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