The Dream of Cheap, Streaming HBO Is Dead
Just when we were getting excited about a standalone streaming service from HBO — like HBO Go, except without paying for a cable subscription — HBO now says it was just kidding and won't cut that cord... ever. Six weeks ago, HBO CEO Richard Plepler said that the premium network "maybe" could "evolve" HBO Go with its broadband partners, suggesting that a streaming version might be available, some day, on some terms. (Currently, the HBO Go streaming service is only available for viewers who pay for a cable package, as well as something like $15 per month to watch HBO on TV.) But Wednesday on an earnings call, his boss, Time Warner CEO Jeff Bewkes, took back that half-promise. "We would do it if we thought it was in our economic best interest. At this point we don’t think it makes sense," Bewkes told investors. "We don't think the target market is sufficiently large to be attractive at this point." That's pretty much the line that HBO and its parent company had been offering an actually quite large market of HBO-loving (and stealing) cord cutters, before Plepler suggested that maybe that market would be sufficient down the line. Except HBO makes a lot of money off its curent system, so HBO doesn't see any reason to mess with its business model.
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And then there is the bigger picture: Time Warner's business model. Indeed, the relationship between HBO and its parent company hinders the chances, long term, of HBO Go being developed for those of us who pay for broadband Internet but not cable. Time Warner loves its Time Warner Cable bundle; it needs the bundle. Even if HBO could get enough money from streaming-only users to sustain its operations, its parent company wouldn't go for it, because its parent company is still in the business of selling cable TV packages. And the cable TV companies were not happy with HBO's Plepler even mentioning a future with HBO outside of the bunclde. One cable CEO called Time Warner up to complain, sources told AllThingsD's Peter Kafka. And since Time Warner depends on the rest of the cable companies to pay a lot of money to buy content from its other divisions, there's not a chance the parent piss them off by letting the kids at HBO go rogue. In the meantime, cord cutters continue to make Game of Thrones the most pirated show in television, even as season three continues, and no matter what lawmakers say.
