[ad_1]
(Credit: Warner Bros.)
Well that’s how you make a statement.
It took them a while, but AT&T (NYSE: T) finally sent the message its subscribers and investors have been waiting for when it comes to streaming – we hear you.
With two big hit announcements and a third rumor coming up, the company is finally becoming the player everyone has been waiting for them to become.
So what does this mean for the business and more importantly for the streaming space?
First, as always, a little background.
You will recall that AT & T’s entry into the streaming space was not exactly easy.
After all, you never plan to launch a service during a pandemic. That said, the launch itself was still a mess and investors noticed it. Forget about the fact that there was a lack of originals, which in itself was a little forgivable (again COVID), but the list didn’t end there.
It didn’t have its catalog firmly in place, it didn’t have high-definition options, and it wasn’t offered free to everyone who was already subscribed to HBO. Yet, most importantly, he didn’t have his cast set. Not being on Roku (NASDAQ: ROKU) and Amazon Fire (NASDAQ: AMZN) was a HUGE problem and made its launch muted to the point that many investors really saw it as a bummer.
(Credit: HBO Max)
And that should never have been the case; when you name a service after a strong network like HBO, it should match expectations. HBO is a revolutionary network with arguably the best programming on TV – HBO Max was not.
Now, over time (as expected) the other issues slowly resolved themselves: more originals arrived, more customers were grandfathered, but still no Roku or Amazon Fire Stick. This week, however, that changed as the week began with the news that HBO Max had done some good with Amazon.
In short, it was a game changer.
It was also exactly what many people expected – and many investors had begged to arrive!
Until now, HBO Max had been in a Catch-22, it needed more subscribers to leverage the platforms and they couldn’t get those subscribers without placement on these two platforms. . Yet, by making deals with Amazon, he is now putting pressure on Roku.
Make no mistake, Roku didn’t need HBO Max before he succeeded (and stayed), but now that his biggest competitor has them, he can’t afford to stay out of the mix. This is true in general, but is especially true before the holidays AND what turned out to be bomb number two – Wonder Woman 1984.
Warner Bros. had debated what to do with his big tent pole and was preparing for a Christmas theatrical release. It had been rumored that it would go to the theater and then quickly go to streaming. The reality was even more shocking – a simultaneous release for both!
Again, however, with no Roku / Amazon in play, it meant less to – well, everyone.
Yes, that was still important – but it would also have limited in terms of needle travel. This is because it doesn’t show investors that he really cares about new subscribers and new HBO Max subscribers don’t care about them. Or really even current subscribers because the ease of access was not there.
Now, however, with Amazon on board (and possibly soon Roku), the sky is the limit and it’s becoming a MASSIVE deal for investors.
The stakes are high.
(Credit: WB)
Suddenly WW84 becoming the first major pole to move from one screen to another means a lot more and it will impact many other industries. Now, every stock in every streaming, movie theater AND media company in general will feel the aftershocks.
With more people having access, it becomes a domino effect.
So what impact does this have on them and their investors?
Well, among the other streamers, the biggest ones to think it will be Netflix (NASDAQ: NFLX) and Disney (NYSE: DIS) – Amazon and Apple (NASDAQ: AAPL) to a lesser extent due to the money made from agreements with their respective devices. In general, many also consider the race for the best streamers to be between Netflix and Disney only. Netflix, of course, has a big lead, but Disney wins.
They are two very nimble companies, but also trying to be a lot of things to a lot of people. Irony is actually their status in the world of cinema. Disney tries to serve two masters and not upset the theatrical balance. Like I said, take a close look at the films they’ve taken in theaters and those they’ve kept – so far it’s been ‘nice to have’ versus ‘to have’ in theaters. rooms.
Conversely, Netflix has tried to do everything to conquer theaters, except for the one thing theaters want: a longer window period between broadcast screens. And it’s interesting because even with the pandemic and its lasting impact on the move to streaming, most theaters seem less frustrated with Disney and the like.
Yes, they’re not thrilled, but they don’t blacklist parent companies (AMC and Universal aside). Yet many theaters (and Hollywood heavyweights – that is, Oscar voters) still have them at this time.
It’s just a weird scenario.
Getting back to HBO Max, he was as always supposed to be a gamer but couldn’t get out of his own way… and he’ll also have Disney’s problem with appeasing theaters that he still needs later down the line.
That’s why they took the multi-platform approach that theater owners have applauded. Again, this is an odd scenario considering how much easier it is to just watch the movie at home for less with a lower risk of catching COVID.
That’s what it boils down to though… a fight for theaters to survive and they’ll take whatever they can get.
(Credit: AMC Theaters)
Now for those who think that HBO Max is too far behind Disney and Netflix to even catch up, well, this is also where the WW84 the movie kicks in. It’s the service’s big money game and they actually put a clock on it. The film will debut on HBO Max, BUT it will only stay there for a month before moving on to paid VOD (which is actually part of the larger issue I mentioned earlier: keeping its vast catalog intact for long periods – but I digress).
The point is that HBO Max wants to use WW84 to make an immediate run to subscribers during the holidays and colder winter months. They want instant success to show shareholders instant results, keeping in mind, however, that we won’t see the full influence on this until AT & T’s first quarter 2021 results, because if the Amazon Fire Stick Agreement will come into effect earlier on WW84 the movie will not.
And that doesn’t even count the third bombshell that Roku made a deal that I would expect to be announced in the not-so-distant future.
Personally, I never thought AT&T would blow things up in such a way and many will say it was a bad decision. Some believe that Warner Bros. leaves a huge amount of money on the table by not getting the movie off until next summer and they might end up being right. However, this is a test – a type of win-now test that’s too fascinating to ignore, especially after the Principle debacle.
It’s entirely possible WW84 Could have opened in June 2021 in theaters and dominated, but let’s be real too, even after a COVID vaccine comes out, will people still be ready to return to theaters – at least so soon? Yes, they may be largely immune, but nothing is 100% and COVID is still a dangerous disease, and many experts still believe masks and social distancing are here to stay until 2022.
AT&T / WB / HBO Max have a chance here to try something different, put some really important data together, and give their rivals a run – congratulations to them for taking it. It was a calculated approach that clearly had a thought behind it.
Amazon / Roku’s one-two and maybe one-two-three punch /WW84 shows that his team is finally taking his situation seriously. HBO Max has a big hole to come out of – but at least (for now) it’s stopped digging itself any deeper.
Disclosure: I / we have no positions in the mentioned stocks, and I do not plan to initiate any positions within the next 72 hours. I wrote this article myself and it expresses my own opinions. I am not receiving any compensation for this (other than from Seeking Alpha). I have no business relationship with a company whose action is mentioned in this article.
[ad_2]
Source link