In August of last year, with HBO Max getting slammed on Twitter and on Reddit for an app that crashed too much, took too long to load and was hard to search, erstwhile parent company WarnerMedia declared that in the ensuing four or five months, HBO Max apps for each major connected TV platform would be overhauled.

Certainly, progress has been made. In September, WarnerMedia debuted a new HBO Max app for Roku, based on technology developed by the Ottawa-based You.i TV unit purchased by WarnerMedia for $100 million. That app, which looks largely the same as the legacy HBO Now/Go tech from which the original HBO Max app was built on, reduced crashes by 90%, WarnerMedia said. 

A subsequent Android TV upgrade improved load times by 50%. And last week, the upgrade was plied to Apple TV. 

Still, however, nine months after Warner's declaration to solve its HBO Max app issues, key platforms still haven't been addressed. 

Speaking to Protocol, Sarah Lyons, head of product experience for HBO Max, said upgrades for Amazon Fire TV and Microsoft Xbox consoles are coming next. She didn't disclose a timeline. 

Notably, Lyons conceded that WarnerMedia -- now Warner Bros. Discovery after last week's closure of the company's $43 billion merger with Discovery -- was well aware that the code used for legacy digital services HBO Now and HBO Go wasn't fit for an HBO Max platform that has gobs more content and more users. 

However, in the spring of 2020, with Disney Plus already in the market and the clock ticking for HBO Max to enter the Streaming Wars, WarnerMedia made the strategic decision to go with flawed legacy technology rather than wait months for a new app architecture to be baked. 

“We knew that that platform never could handle what HBO Max was going to do,” Lyons told Protocol. “It never was intended to go global, it was never intended to go direct-to-consumer.”

For its part, HBO Go was a "catch-up" app that lacked robust search and discovery features. “You didn't have to go find anything, because whatever [show] you were looking for was going to be at the top of the home page,” Lyons said.

HBO Max struggled out of the gate. Not only was its app clunky, it wasn't even available during the service's first six months for crucial platforms including Roku and Amazon Fire TV. 

Perhaps even worse, the crushing initial impacts of pandemic quarantines badly curtailed HBO Max's launch schedule for new shows, including that vaunted Friends reunion. 

WarnerMedia purchased You.i TV in December 2020 and put it to work on a new HBO Max app, but few noticed the connection. 

However, in the spring of 2021, HBO Max began to find its audience with hit original shows including Mare of Easttown and Hacks, as well as a flurry of Warner Bros. theatrical releases that were premiering day and date on HBO Max because of the pandemic. 

Suddenly, usage was way up, and subscribers were complaining about the Max app in droves, across platforms. 

For Lyons and her team, it's been a white knuckle ride since, triaging solutions while trying to get the upgrades for specific CTV platforms to market. 

“I've literally been looking at customer feedback daily. I look at all social media, tweets, every single word a customer says,” she said.

Amazon and AT&T’s WarnerMedia division have reached an extension agreement that will allow users of Amazon Fire TV connected TV devices to keep streaming HBO’s legacy service directly through the HBO app. 

The two sides have yet to hammer out a deal that will enable users of Fire TV-enabled streaming sticks, boxes and smart TVs to use the new HBO Max app, however. 

But for now, the extension means that Fire TV users can still use the erstwhile HBO Now app. Effective August 1, that legacy app, and the legacy HBO streaming service, are being rebranded as simply “HBO.” 

Also read: HBO Now Support on Amazon Fire TV Set to Expire Friday

If a deal hadn’t been reached, Fire TV users would have still been able to access HBO content through mechanisms like the Amazon Prime Video Channels app. They just wouldn’t have been able to use a standalone HBO’s app. 

As for HBO Max, it has about four times as much content as legacy HBO, drawing not just from the programming resources of WarnerMedia’s premium cable unit, but also outlets ranging from Turner Networks to Warner Bros. Pictures. HBO Max also has a burgeoning library of original shows, although WarnerMedia’s ambition for originals has been understandably curtailed by pandemic-related studio shutdowns. 

What HBO Max does lack, however, is distribution. Since it launched May 27, the two leading connected TV OS operators, Roku and Amazon, have not supported the new app. 

Also read: Bezos Predicts Amazon Fire TV Deal for HBO Max

For its part, Amazon has been accused of trying to undermine what is essentially a rival SVOD service to Amazon Prime Video. 

Testifying to a House Committee earlier this week, Amazon founder and CEO Jeff Bezos chalked the impasse up to large media-tech companies just doing what they do when they negotiate. He expressed confidence that a deal to bring HBO Max to Amazon Fire TV would be hammered out shortly. 

Now exactly two months into its launch, HBO Max has been stunted by a lack of app support on the two biggest connected TV platforms, Roku and Amazon Fire TV.

But while every day that the HBO Max app remains shut out of these two platforms hurts the proliferation of the new streaming service, another timeline quietly ticks away—support for the legacy HBO Now app on Amazon Fire TV.

As reported by Variety earlier this month, AT&T and its WarnerMedia division don’t have a deal in place to maintain support for even the legacy HBO Now app on Fire TV devices after July 31.

Next TV sent emails requesting status updates to any negotiations to both Amazon and WarnerMedia July 27. We haven’t heard anything back yet.

The legacy HBO Now app is set to be rebranded by WarnerMedia as simply the “HBO” app after July 31. Roku users will still be able to access that legacy app.

As part of the rebranding, the legacy HBO Go app is being terminated after July 31.

Unless WarnerMedia and Amazon can come to an agreement, HBO subscribers will not be able to access a standalone HBO app on Fire TV of any kind, effective August 1. However, HBO subscribers will have access to HBO content through the Amazon Prime Video app.

OK, why does this matter? Well, lots of people are still using HBO Now.

According to an analysis of HBO app users conducted by Reelgood in the 14 days after HBO Max’s May 27 launch, 29% were still using the HBO Now app to access HBO content.

Last week, during AT&T’s second quarter earnings call, AT&T CEO John Stankey addressed the Amazon impasse: “We tried repeatedly to make HBO Max available to all customers using Amazon Fire devices including those customers that have purchased HBO via Amazon,” Stankey said. “Unfortunately Amazon has taken an approach of treating HBO Max and its customers differently than how they've chosen to treat other services and their customers.”

For more stories like this, go to nexttv.com.

Now exactly two months into its launch, HBO Max has been stunted by a lack of app support on the two biggest connected TV platforms, Roku and Amazon Fire TV.

But while every day that the HBO Max app remains shut out of these two platforms hurts the proliferation of the new streaming service, another timeline quietly ticks away—support for the legacy HBO Now app on Amazon Fire TV. 

As reported by Variety earlier this month, AT&T and its WarnerMedia division don’t have a deal in place to maintain support for even the legacy HBO Now app on Fire TV devices after July 31. 

Next TV sent emails requesting status updates to any negotiations to both Amazon and WarnerMedia Monday morning. We haven’t heard anything back yet. 

Also read: AT&T’s Stankey Calls HBO Max Launch ‘Flawless’

The legacy HBO Now app is set to be rebranded by WarnerMedia as simply the “HBO” app after July 31. Roku users will still be able to access that legacy app. 

As part of the rebranding, the legacy HBO Go app is being terminated after July 31.

Unless WarnerMedia and Amazon can come to an agreement, HBO subscribers will not be able to access a standalone HBO app on Fire TV of any kind, effective August 1. However, HBO subscribers will have access to HBO content through the Amazon Prime Video app. 

OK, why does this matter? Well, lots of people are still using HBO Now. 

According to an analysis of HBO app users conducted by Reelgood in the 14 days after HBO Max’s May 27 launch, 29% were still using the HBO Now app to access HBO content. 

Last week, during AT&T’s second quarter earnings call, AT&T CEO John Stankey addressed the Amazon impasse: “We tried repeatedly to make HBO Max available to all customers using Amazon Fire devices including those customers that have purchased HBO via Amazon,” Stankey said. “Unfortunately Amazon has taken an approach of treating HBO Max and its customers differently than how they've chosen to treat other services and their customers.”

AT&T pulled the trigger on its much-awaited HBO Max streaming service Wednesday, and despite a few minor hiccups, so far has managed to navigate what it sees as a transformational moment in the evolution of pay television relatively unscathed. But while that could change as the day progresses and more consumers attempt to access the more than 10,000 hours of original and library content available, there is still some confusion as to who gets the service for free and who has to pay.

HBO has about 35 million subscribers, most of whom get access to HBO Max on launch day. AT&T has said it expects about 50 million HBO Max customers by 2025.

HBO Max won’t be without competition. Aside from Netflix, which has about 70 million customers in the U.S. and Canada, The Walt Disney Co.’s Disney Plus launched in November with 10 million downloads on the first day. It now has about 36 million subscribers. Hulu, controlled by Disney, has about 32 million customers to its ad-supported service and NBCUniversal, which soft-launched its streaming service Peacock in April to better than expected results, is planning a wider rollout on July 15. 

So far, the biggest complaints around the HBO Max launch is that HBO Now subscribers are finding their watch lists are not transferring to the new service.

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While it seems like HBO customers would welcome a switch to HBO Max -- AT&T CEO John Stankey has called the dilemma “an IQ Test” for current HBO subscribers because HBO Max offers twice the content at the same price -- some recent data shows that HBO’s subscriber rolls could shrink.

According to a New York Times/Kantar survey, one in five current HBO and HBO Now subscribers said they would cancel service in the coming months. That is nearly three times the 7.4% who said they would cancel their Netflix subscriptions in the same time frame and more than double the 8.6% of Disney Plus customers who said the same. Amazon Prime Video customers, perhaps because their video subscription is an add-on to the free-shipping Amazon Prime service, has the lowest rate at 1.2%.

Related: Stankey: AT&T TV, HBO Max Could Eventually Become One

But that raises a lot of questions for a service upon which AT&T has squarely laid its hopes for the future of pay TV. HBO linear rates are around what HBO Max is charging, so getting them to convert to the new service won’t mean much in terms of additional revenue. And at the same time, cord-cutting reached its highest level in the first quarter -- nearly 2 million homes disconnected pay TV service -- which could present problems for a new product launch.

AT&T unveiled HBO Max on Oct. 29,  and despite the enthusiasm of its executives, didn't really generate a lot of heat among the analyst community who initially saw the service as a higher-priced ($14.99 per month) less robust version of Netflix. While that attitude has changed somewhat in the succeeding months, there is still some uncertainty as to how many of HBO Max’s new customers will actually be paying for the service.

AT&T has said that existing AT&T wireless, internet and video (AT&T TV, DirecTV, U-Verse) customers would receive HBO Max for free. In addition, current subscribers to its HBO Now streaming service will get instant access to HBO Max at no additional cost and the HBO Now app will automatically update to the HBO Max app on supported devices. Current HBO linear subscribers who get their service and are directly billed through Cox, Hulu, Optimum, Charter Spectrum, Suddenlink, Verizon Fios TV and select members of the National Cable Television Cooperative ( WOW!, Atlantic Broadband, RCN, MCTV and hundreds of others) also have access to HBO Max at no extra cost. Customers can download the HBO Max app and then elect to access it on supported devices or via desktop and log in using their existing provider’s username and password to unlock all of HBO Max.

The service also is available through Microsoft XBox One and Sony Playstation 4 gaming consoles. Subscribers to HBO Max through those consoles will likely get HBO Max at no additional charge, but new customers will have to pay.

And new subscribers can sign up and pay for the service through HBOMax.com, any of the AT&T properties previously mentioned as well as Apple (iPhone, iPad, iPad Touch, Apple TV 4K and Apple TV HD), Chromecast and Chromecast built-in devices, Google Play, Android phones, tablets and Android TV, Hulu, Samsung Smart TVs (models 2016-2020), Sony Android TVs (2016 models and later), and YouTube TV.

Additional devices will be updated here.

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AT&T’s much anticipated Investor Day Oct 29 may not have wowed Wall Street as was intended, but it may have an unintended emotional effect on its distributors.

The general analyst reaction to the multi-hour Investor Day -- essentially AT&T’s coming out party for its HBO Max service -- was a resounding “meh.” Words like “underwhelming,” “unanswered questions,” and “will probably anger its existing distributors,” were in heavy use in the analyst community. That doesn’t look like much of an endorsement for the service, but I’m not sure AT&T really cares.

Investors also yawned after the Investor Day, which some believed would put AT&T on the same mountain top as its rival streamer -- The Walt Disney Co. -- which is about to launch its newest streaming product Disney+ on Nov. 12. Disney stock soared 13% the first trading day after it unveiled Disney+ in a nearly three-hour presentation at its own Burbank studios on April 11. AT&T, the day after its two-hour HBO Max unveiling, was up less than 1%. Things weren’t any better the next day -- AT&T stock closed Oct. 31 at $38.20, up 0.8%.

Granted, Disney startled the investment community in April with the low monthly price-point for Disney+ -- $6.99. MoffettNathanson media analyst Michael Nathanson wrote at the time there was “a collective gasp” in the room when pricing was revealed. 

HBO Max will debut in May, so there is still some time for AT&T to soften some of the sharp edges of the service. But at $14.99, HBO Max appears meant to replace existing offerings HBO Now and the linear HBO service and its sister website HBO Go.

Distributors, if they aren’t angry yet, probably will be soon. Back in 2015, in the days before HBO was gobbled up by the phone company, the old HBO guard was very sensitive to how it launched its first streaming product HBO Now. Then-HBO chairman and CEO Richard Plepler made a concerted effort to let distributors know that HBO Now was not in competition with the linear product. HBO Now was priced at the same price point for the linear service and distributors were in on the marketing and selling of the offering, which was targeted at broadband-only customers. Plepler, who left HBO in February, and his team made it clear that HBO Now wasn’t being created to compete with traditional distributors, but to expand the products they could offer customers who had cut the video cord.

Now the reality may have been different -- HBO Now, which some distributors believe has cannibalized the linear product, has about 5 million customers, all of which are expected to be converted to HBO Max. But back then there was at least an effort made on behalf of the programmer to try to massage some battered distributor egos. This time though, it seems like HBO and AT&T are just rubbing it in the distributor’s face.

HBO Max is priced about the same as what traditional distributors are charging for HBO -- although some smaller distributors price HBO as high as $19.99 per month. But HBO Max has a lot more original programming and a deeper library and, according to several analysts, a better interface. WarnerMedia CEO John Stankey (also COO of AT&T) said during the Investor Day that the company looks at the Max service as an “IQ Test” for existing HBO subscribers. “Why wouldn’t you want twice the content for the same price?” he asked.

But HBO Max is an IQ test for distributors too. They have to decide whether they want to sell a premium channel that compensates them less, or use that channel capacity for other, more profitable services like broadband.

Otter Media CEO Tony Goncalves explained at the Investor Day that when HBO Max launches, HBO customers can watch the entirety of the HBO service on the HBO Max app as well as that service’s additional content. The existing linear HBO channel will also still be accessible “through your DirecTV or AT&T service,” he said.

Goncalves added that HBO is in “active discussions” with distributors and that the “intent is to get these 30-million-plus customers access to HBO Max as soon as we can.”

Stankey added that the company is “optimistic that we can actually open up agreements and do something proactively. Obviously it takes two parties to agree to do that. That’s the approach we have been using up to this point.”

It seems that even HBO is a little confused by the offering, or at least wants to appear that it can have its cake and eat it too.

Goncalves called HBO Max “our workhorse,” adding it is the greatest consumer value proposition in the stable, bringing together the HBO content and service with content from HBO Max.

“But we’re fortunate to have a base of consumers today that’s north of 30 million and they are accessing the content in a certain way, and we’re not going to leave them behind,” Goncalves said. “So over time, we should see audience migrating to this incredible value proposition that we showed you today, and we’ll migrate folks over to that particular product. But in the meantime, if a customer is comfortable accessing the content through the HBO Now product or HBO Go, we are going to allow them to continue to do that.”

But for some distributors, holding on to the linear HBO service -- which can number as high as 10 separate channels -- may not be worth it. While the details are still a little murky as to the relationship between HBO legacy and HBO Max, it would seem obvious that most consumers would go for the streaming service.

And that, at least to some distributors, removes the incentive to renew their HBO deals.

“At some point you’re going to say, ‘Why am I holding this huge block of channel capacity for HBO channels, when I could be using it for faster internet speeds,’” said the distributor who asked not to be named.

In a research note entitled “Product Looks Good, But is Not a Game-Changer,” Evercore ISI media analyst Vijay Jayant wrote that AT&T’s HBO Max strategy is likely to rub distributors the wrong way.

“We expect this situation to create conflict between HBO and non-AT&T distributors, as AT&T is likely to argue that the distributors should switch to promoting HBOmax, with a much smaller revenue share, while the distributors are likely to argue that the non-max HBO

product has been devalued, and hence they should pay a smaller revenue share on that product. It’s unclear how these negotiations will shake out over time,” Jayant wrote.

Distributors have long chafed at streaming services that offered more or equal amounts of content for a lower price directly to consumers than what the MVPDs were already paying. It was at the core of at least one carriage battle for premium service Starz -- since resolved -- which was priced at $8.99/month as a standalone streaming service, but $11.95/month via traditional pay TV distributors.

At Dish Network, which dropped HBO last November, the impasse was fueled by what it said was the programmer’s demand that it pay for a guaranteed number of subscribers, regardless of how many actually sign up for service.

Dish chairman Charlie Ergen was criticized for dropping HBO at the time. Now he looks like a freaking genius.

Because unlike his distribution counterparts, Charlie is not going to have to worry about splits and marketing and mandatory minimums and the like. If his customers want HBO in any of its iterations, they are going to have to fend for themselves.

It has been a year since Dish dropped HBO -- it officially went dark on Oct. 31, 2018 -- and the impact has been fairly minimal. After an initial spike in pay TV subscriber losses that may or may not have had anything to do with the loss of HBO (Dish also dropped several regional sports networks in the time frame) -- Dish lost 334,000 subs in Q4 2018 (compared to 39,000 in the prior year) and 259,000 in Q1 2019 (compared to 94,000 in the prior year) -- the shock seems to have lifted. Dish lost 31,000 pay TV customers in Q2 (compared to 151,000 in the prior year).

Whether other distributors follow Dish’s lead will depend on when they last signed a carriage renewal with HBO. But for distributors that are looking for an excuse to drop the premium service, AT&T seems to have given it to them.

Related: Dish’s Dilemma 

Now you may ask, what does AT&T care about other distributors? They have DirecTV (or AT&T TV) or whatever they’re calling their satellite distribution service. And that is true. DirecTV has about 18 million pay TV customers, but it is bleeding subscribers like a sieve. In Q3, between DirecTV, AT&T TV Now (formerly DirecTV Now) and U-verse TV, AT&T lost 1.4 million customers. That’s huge. And though AT&T has said DirecTV’s losses have peaked, that doesn’t mean they won’t lose more.

AT&T is expected to try to migrate most of those DirecTV customers to its thin-client AT&T TV service, which also is expected to be launched next year. No pricing info for the service has been released, but it is expected to include live TV, programming from AT&T’s Turner networks and HBO Max.

AT&T also plans an ad-supported version of HBO Max for 2021, as well as live TV bundles as part of the service eventually, which could also complicate things.

“We are a lot more skeptical about these components,” Venkateshwar wrote. “Apart from brand dissonance with respect to HBO’s premium nature, these features also seem forced to make economics work in the context of the investment scale. Brand consistency is also likely to be a problem due to content on Max being skewed more towards young adults which has not really been a target for HBO given its premium price point. Also, including some of these components are likely to make discussions with legacy distributors a lot more contentious.”

In the meantime, AT&T plans to beef up the HBO Max subscriber coffers by giving it away for free to its wireless subscribers, a strategy it used for the skinny bundles AT&T Watch TV, an experiment it has since ended. 

AT&T has predicted that it will sign on 50 million HBO Max subscribers by 2025, but that includes about 34 million existing HBO customers. And in addition to making HBO Max available for free to its unlimited wireless customers, premium AT&T pay TV and 1 Gigabit per second broadband subscribers also will get the service for no extra charge. Venkateshwar estimated that would account for about 5 million subscribers within its wireless base that would be eligible. That works out to nearly 40 million subscribers, making hitting that 50 million customer goal not that much of a stretch. Disney, which signed a deal with Verizon to make Disney+ available to their wireless customers free for 12 months, expects to add 7 million to 10 million customers by the end of this year.

AT&T has been saying for more than a year that they see the future of TV in eyeballs and targeted advertising, constantly reminding anyone within earshot that they have access to about 170 million customers through all of their properties. But how they approach monetizing those eyeballs is going to be crucial. Remember when Fox bought MySpace? And how they were going to push adds and programming to that treasure trove of young online users? Remember how that worked out? (Hint: Fox bought MySpace in 2005 for $580 million and sold it in 2012 for $35 million)

The key will be how AT&T uses its clout. If it decides to just carpet bomb those 170 million customers with ads and whatnot, it will be a disaster. I don’t know about you, but the second my mobile phone starts lighting up with ads that I never requested, that phone is immediately going into the river. I’m guessing that with the myriad options for wireless service and the ease at which most make it for consumers to switch, many annoyed customers would do the same.

AT&T is not doing this all without some expense either, which has some analysts scratching their heads. In his report, Venkateshwar wrote that AT&T will spend about $19 billion over the next five years to get 16 million cumulative HBO Max subscribers. While not all of that money will be spent on subscriber acquisition, Venkateshwar posits that in order for the service to work it either has to have much lower churn than its rivals or its base of subscribers has to be much higher than AT&T’s guidance. In addition, AT&T will have to drive other revenue sources -- particularly advertising, which the company has said is a goal -- and content licensing.

Streaming video churn is high, especially for services that market themselves mainly on price -- just ask AT&T TV Now (formerly DirecTV Now) which sank like a stone after it raised prices.  Free is a great way to bulk up subscriber rolls, but don’t be surprised when they bail as soon as the price gets too high. And it will. If there is a fundamental truth to the television business it is this -- programming is costly and nobody makes quality content for free.

“We also believe the vision for the product doesn’t appear to have been fully crystallized given the open questions around AT&T TV’s integration into the service, which increases the chances for a non-linear execution path,” Venkateshwar wrote. “Also, based on the guidance provided for HBO Max revenue for next year at the event ($100 million), the company does not appear to expect a significant amount of paid gross adds until 2021 and therefore much of the company’s total revenue growth guidance for next year appears to be based on acceleration in zero-margin equipment revenues.”

But maybe this is working out exactly the way AT&T wants it to work out. The consensus belief is that when AT&T bought DirecTV in 2015, it knew the satellite business was dying, but saw value in the company’s programming contracts to fuel other distribution products. DirecTV is losing subscribers by the ton, but it was all part of the chain that started with AT&T’s wireline U-Verse TV customers migrating to DirecTV and ending with their move to DirecTV Now (now AT&T TV Now). With AT&T TV Now struggling -- it has lost about 700,000 customers in the past four quarters -- the focus is on HBO Max and AT&T TV, the IP-based streaming service that will also launch next year.

And it may be wildly successful. One thing you can bank on in the TV business is that nobody gets ahead by standing still. At the same time, upsetting the distributor base that is still paying the freight for content companies via traditional carriage fees is no way to move forward either.

So, it could really go either way. And to those that are looking for signs from above, I give you this: WarnerMedia Entertainment chairman Robert Greenblatt walked onto the stage at the Investor Day to the tune of the theme song to former HBO series Six Feet Under, which he produced earlier in his career. Six Feet Under was an Emmy-award winning series about a severely dysfunctional family that made its living by burying the dead. Let’s hope that in the next few years, we don’t look at that entrance as an omen for what was to be. 

These days, before any company launches one of the myriad new streaming ventures, you can pretty much guess that it’ll end with a “plus” or a “go” … or a “now.”

Of course, the surprising part of AT&T’s latest monikers is the utter lack of the name “DirecTV.”

HBO Max, which is the name of the company’s upcoming SVOD platform, will borrow the branding of a tried and true WarnerMedia asset—one that already has an SVOD user base of 8 million customers through HBO Now.

Meanwhile, screen grabs of internal AT&T communications, recently intercepted by website TheLayoff, reveal that the wireless giant is calling its upcoming premium “thin client” pay TV service “AT&T TV.”

When it launched DirecTV Now 30 months ago, it appeared the satellite brand would be key to the telecom's future video plans. But appears even the virtual MVPD platform, which quickly grew to 1.8 million subscribers before sputtering, is on the way to marginalization, too.

AT&T chairman and CEO Randall Stephenson said last month that virtual MVPD DirecTV Now will “eventually” be merged into HBO Max.

Also notable: AT&T mobility and entertainment president David Christopher, speaking last month at an investment bank conference in London, said DirecTV Now would be downsized to a “thin” service targeting the company’s 170 million mobile connections.

“We have emphasized [DirecTV Now] slightly less than we did when it first launched because we are focused more on other elements of the portfolio,” Christopher said.

For those keeping score on AT&T’s 2015 purchase of DirecTV, all I can say is that $67.1 billion doesn’t buy you as much brand equity as it used to.

AT&T’s marketing choices lend credence to rumors that began circulating last month—that AT&T might soon combine its declining DirecTV satellite TV operation with the equally challenged Dish Network satellite platform. Both divisions lost a combined 2.36 million customers in 2018.

With just under 24 million pay TV customers spread across DirecTV Now satellite, AT&T U-verse and DirecTV Now, AT&T still has more scale than any other operator in the pay TV business, including Comcast. But given AT&T’s new priority of monetizing WarnerMedia’s assets through SVOD, you wonder how much getting the best programming deals for linear pay TV matters anymore to the company.

Of course, more than a decade before AT&T bought it, DirecTV was stopped by regulators from merging with Dish. But regulatory concerns might be ebbing amid markedly decreased relevance and an overall competitive video marketplace.

“It is against this highly competitive backdrop that we now believe regulators could potentially allow for the combination of satellite/DBS players due to its antiquated technology, structural challenges (inability to bundle), as well as the emergence of broadband-delivered video— which is becoming the predominant form of video consumption of late,” wrote JPMorgan analyst Philip Cusick.

Should Epix Now have been Epix Four Years Ago?

As the premium cable network finally gets into the direct-to-consumer OTT game, the question certainly comes to mind: Why did Epix wait until now, when the market for additional subscription streaming services is beginning to feel a little saturated?

Consider that market leader HBO Now launched in April 2015 and surpassed 5 million subscribers a year ago, according to the last disclosed numbers. Showtime Anytime came out of the gate in July 2015. Also in February 2018, Showtime’s parent company, CBS Corp., said it had 5 million subscribers across its streaming properties, which also includes SVOD service CBS All Access

Starz direct-to-consumer OTT app deployed in April 2016 and reached 3 million users by September of last year.

As for MGM-owned Epix, it is finally launching its own a la carte streaming service, competitively priced at $5.99 a month and available without a pay TV subscription for iOS and Android mobile device users, as well as those who own Apple TV and Google Play OTT devices. (Roku and Amazon Fire TV apps are said to be on the way.)

“Epix is set up for its biggest year yet,” said Michael Wright, president of the premium cable programmer, to reporters covering the Television Critics Association winter press tour this last week.

As the late Lloyd Bridges’ befuddled air traffic control man, Steve McCroskey, might say in the 1980 comedy classic Airplane!, Epix picked a bad day to start a direct-to-consumer OTT business.

By most accounts, the subscription OTT market is cooling, with many operators now considering ad-supported models.

The major SVOD services, Netflix and Hulu, are still growing. But in OTT sectors like the virtual MVPD market, we’re seeing heavy shrinkage, with DirecTV Now losing 267,000 subscribers in the fourth quarter.

As for the premium cable networks, we’re not hearing much these days. Nobody is talking about significant subscriber losses, but there are no boastful benchmark announcements, either—evidenced by the fact that it’s been a year since HBO and Showtime released in any subscriber numbers for their respective OTT services.

And the subscription OTT market is about to grow more crowded, not less, with Disney and WarnerMedia readying the launch of several more major paywalled platforms.

Back in September, research company Parks Associates suggested that the market had reached “peak OTT,” with consumers settling on a finite number of subscription services—keeping them, but not really adding more.

“With OTT service penetration starting to plateau at around 65% adoption among U.S. broadband households, the OTT video market is reaching a level of saturation for the services currently available to consumers,” analyst Hunter Sappington said. “In an increasingly crowded and competitive marketplace where subscriber acquisition costs are high, this plateau highlights the need for services to focus on retention rather than solely acquisition.”

Regardless, into the breach Epix goes.

It’s notable that Epix has streaming technology infrastructure in place. The programmer has long offered a streaming app that allowed authenticated pay TV users to stream content.

MGM-owned Epix is distributed in around 70 million U.S. pay TV homes, with a distribution deal signed with Comcast last year significantly increasing its reach. Sounding a rather ambitious tone, Wright noted that the service’s reach could extend to 120 million homes with the new OTT product.

While Netflix continues to steadily acquire mobile users across the globe, other SVOD services are actually being abandoned by these smartphone watchers in select regions, a new study by Juniper Research suggests.

The research company polled 500 mobile video watchers in the U.S., UK and China in September. According to its findings, in the U.S., Netflix was the only service that showed positive retention, with 6.3% more users reporting adoption of the platform vs. those saying they plan to abandon it over the next six months.

Rival subscription video on demand (SVOD) platform Amazon Prime, however, was in the red at -2.9%, while HBO Now experienced a whopping -19.2% among the U.S. users sampled.

Related: U.S. OTT Revenue Will Spike 26% to $28.8B in 2018, Report Says

So just how revealing is Juniper’s sampling? Beyond the fact that the UK research company doesn't express any timelines to its research, it's all somewhat questionable. In February, HBO Now confirmed steep subscriber growth to 5 million users, with the platform being amply distributed through Amazon Channels. And over the spring, Amazon confirmed that its Amazon Prime program—which, in addition to SVOD, includes stuff like free shipping—now has 100 million users.

For its part, however, Juniper seems to want to make the point that heavy video users are adopting more than one SVOD platform, but are struggling to find the right combination of services.

“The use of multiple subscriptions suggests that no one provider offers enough to currently satisfy consumers,” said Lauren Foye, who authored the Juniper report. “Juniper finds a growing danger in users reducing, or switching SVOD subscriptions, as monthly fees inevitably rise as a result of ever-increasing content spend; Netflix alone is set to spend $13 billion this year.”

Subscribers to HBO Now and other direct-to-consumer OTT options from HBO offered through streaming distributors such as Amazon and DirecTV Now have surpassed 5 million, according to multiple reports.

That more than doubles the 2 million OTT subs that HBO had accumulated when Time Warner disclosed that figure about a year ago.

RELATED: Bewkes: HBO Now Tops 2M OTT Subscribers

HBO added five million domestic subscribers for all of last year, with Q4 revenues rising 13%, to $1.7 billion (including a 16% rise in subscriber revenues), according to The Wall Street Journal. The WSJ, citing an HBO exec, was also among the news outlets reporting the updated 5 million streaming subscriber figure for HBO. 

RELATED: Time Warner Reports Higher 4th Quarter Earnings

HBO Now launched on April 7, 2015, for $14.99 per month. Amazon started to pitch HBO subscriptions to Prime customers in late 2016. DirecTV Now, AT&T’s OTT TV service, has been offering HBO as a premium add-on, for $5 extra per month, since its launch in November 2017. 

Hulu has reached a deal to make HBO and Cinemax available to Hulu’s live and on-demand subscribers as premium add-ons.

HBO and Cinemax are owned by Time Warner, which bought a stake in Hulu last year.

Hulu subscribers will be able to buy HBO for $14.99 a month and Cinemax for $9.99 a month. The deal comes just before the July 16 premiere of season seven of HBO’s big hit Game of Thrones.

“By combining HBO’s iconic programming with our world class user experience and deep content offering, Hulu is giving viewers easy and highly personalized access to the very best of television,” said Tim Connolly, senior vice president and head of distribution and partnerships at Hulu. “With this important new partnership, fans can now watch Game of Thrones live every Sunday, binge watch all six seasons of The Sopranos or catch up on Westworld alongside our live TV, sports, classic TV shows and Hulu originals – all without ever having to leave the Hulu app.”

AT&T’s DirecTV Now is offering HBO free for an introductory period. HBO also offers its own over-the-top service, HBO Now, directly to subscribers.

“Hulu has been a pioneer in the television streaming business, building a robust user base by offering top-tier programming from a variety of networks,” said Sofia Chang, HBO executive vice president, worldwide digital distribution and home entertainment. “We see them as the perfect partner to help us fulfill our promise to HBO fans, bringing our unparalleled programming to audiences in the most sophisticated, convenient and innovative ways.”

East and West Coast live feeds of HBO and Cinemax will be available to Hulu viewers on supported devices.

Subscribers who purchase the HBO add-on through Hulu will also gain access to HBO Now through their Hulu account. In the coming weeks additional live channels HBO 2, HBO Family, HBO Latino, HBO Comedy, HBO Signature HD, HBO Zone, MoreMAX HD, ActionMAX HD, ThrillerMAX HD, MovieMAX HD, 5StarMAX HD and OuterMAX HD will become available to Hulu viewers within the add-ons, the company said.

HBO will make all four episodes of its documentary series The Defiant Ones available on the network’s digital streaming platforms beginning July 9.

The series, which will run on HBO over four consecutive nights beginning July 9, will be available on HBO Go and HBO Now as well as HBO On Demand, said network officials.

The Defiant Ones chronicles the story of the decades long musical and business partnership between Dr. Dre and Jimmy Iovine, and will feature interviews with Bono, David Geffen, Eminem, Nas, Stevie Nicks, Kendrick Lamar, Ice Cube, Gwen Stefani, Jon Landau, Tom Petty, Trent Reznor, Snoop Dogg, Bruce Springsteen, Diddy and will.i.am.

Netflix may have a sizable subscriber lead on other SVOD services, but HBO Now beats them all when measured against more than a dozen categories linked to customer satisfaction, Strategy Analytics found in a study that also included Hulu and Amazon Video in its analysis.

RELATED: Netflix Ended 2016 With 93.8M Subs Worldwide

Per the report,  HBO Now, the direct-to-consumer OTT service that debuted in April 2015, ranked highest in 11 of 14 categories, including availability of past season TV shows, overall number of shows and original programs, hit movies, quality of original programming and movies.

Netflix was ranked tops in three categories – recommendations, cost of the service, and, most notably, overall satisfaction.

Hulu held the edge in children’s programming, and outscored Netflix in six of the 14 categories. Amazon Video did not score highest in any of the report’s 14 categories of measurement.

“HBO Now has successfully positioned itself as a go-to-service for quality programs, especially movies,” Zhaowen Wu, digital media strategies analyst at Strategy Analytics, said in a statement. “Though HBO Now has a much smaller library than other SVOD services, it has more blockbuster movie and hit series such as Game of Thrones and Westworld.”

“When considering the bigger picture, Netflix clearly benefits from its brand ‘halo’ whilst HBO Now suffers from a negative association with cable’s legacy issues, however, once one gets into the weeds, the reality is that HBO subscribers are the most satisfied with nearly all elements that make up a strong SVOD service,” added Michael Goodman, the research firm’s director, digital media strategies.

Goodman stressed that the difference in scores across most categories was relatively small, and that Amazon’s scores could be impacted because video is just one benefit included in a Prime subscription.

“People have been talking about it being a Netflix vs. Amazon battle in terms of which service viewers choose, with the others left to pick up the scraps. However, if HBO continues on this vein, we’re more likely to see a situation where people will have one ‘blockbuster’ service like HBO or HBO Now and either a Netflix or Amazon in support,” Goodman said. 

HBO is entering the world of VR with apps for HBO Now and HBO Go that run on Daydream View, Google’s new virtual reality headset that’s compatible with certain Android-powered smartphones such as the new Pixel and Moto Z and Moto Z Force.

HBO’s apps – for its standalone OTT service and TV Everywhere offering – lets authenticated users watch original series such as Game of Thrones and Westworld on a 2D screen rendered in a 360-degree, digitally-rendered environment.

HBO’s new apps were among several new offerings that are being launched, or will be soon (Netflix, for example), for Daydream View, the $79 headset that became available last month.

RELATED: Google Daydream View Hits Stores Nov. 10

Google also teed up this new sizzle reel for Daydream View:

Time Warner chairman and CEO Jeff Bewkes said AT&T’s pending $108.7 billion merger to buy his company will drive advanced advertising for every network, not just his own.

At the UBS Media and Entertainment conference in New York, Bewkes said that there is a big opportunity in advanced advertising on the VOD platform. And he said he hopes that the AT&T merger, which counts targeted advertising as a big reason for the pairing, will help drive acceptance.

“If you’re talking about VOD ads, it’s going to evolve differently,” Bewkes said. “In terms of load it probably should be less; it’s going to be taking the recent engagement and the tremendous loyalty it has. You need to get it targeted, you need to get it measured; it therefore can be more valuable and therefore it can be less interruptive, therefore people will watch through it. “We’ve been investing in that at Turner. We probably have the higher percentage of our ads in the more aggressive new advertising forms. We’re going to keep doing that. We hope the AT&T combination helps us with that. We hope it helps everybody. We want to foster competition in the ad business, which currently is getting fairly focused in two companies – Google and Facebook – and we think there is plenty of room for competition and therefore growth for us, so we’re going to go there. We’re here to help.”

Bewkes also gave a lengthy explanation as to why Time Warner still makes money on AT&T’s decision to price the HBO offering on its DirecTV Now over-the-top service at $5 per month, roughly one-third of the price other distributors charge for the service. Bewkes said that HBO still has a robust wholesale price – which he did not reveal – adding that charges to distributors vary based on the level of subscriber penetration for HBO service. So, a distributor that has 40% HBO penetration pays less than one with 20%, he said.

He added that offering HBO at a lower retail price is something Time Warner has wanted for years, but that distributors have tied other programming or services with flat price structures to the premium channel which has driven up charges.

“We’ve always wanted, which is why we had to launch [HBO] Now a few years ago, to make HBO in a more affordable price range,” Bewkes said. “We welcome distributors making aggressive price offerings for HBO.”

Bewkes also seemed to dispute recent reports that its standalone HBO OTT service, HBO Now, was having difficulty growing subscribers. When UBS media analyst Doug Mitchelson, who was interviewing Bewkes, mentioned he thought a recent estimate that HBO Now had about 1 million subscribers was low, Bewkes responded, “me too.”

“We didn’t hit the wall and we’re not building the wall,” Bewkes said.

Regarding its cable networks, Bewkes said recent affiliate renewals for its Turner networks were “very robust.” And he added that CNN is expected to build on the momentum of 2016 into next year through its mix of domestic and international news, digital offerings and strong original shows, like Anthony Bourdain Parts Unknown.

“That combination, which is a pretty wide mission for CNN, has worked great and that’s  why we are  doing so well in earnings and we’ll do even better next year,” Bewkes said.                 

HBO’s scheduling decision to offer early views of the second episode of sci-fi series Westworld helped the episode draw a combined 2.7 million viewers, the network said Monday.

The pay service made the Westworld episode available Friday via HBO and HBO Now prior to last night’s linear debut, which was up against stiff competition from NBC’s Green Bay Packers-New York Giants National Football League live game telecast and multichannel coverage of the second presidential debate.

The episode drew 1.9 million viewers across two Sunday plays, and another 800,000 viewers on its streaming platforms, according to network officials. The Oct. 2 premiere episode of Westworld has thus far reached more than 6 million viewers via multiple linear plays and across multiple platforms, said the service.

HBO offered early digital plays for two freshman comedy series Divorce and Insecure. Divorce, starring Sarah Jessica Parker and Thomas Haden Church tallied 1.1 million viewers – 723,000 viewers across two Sunday linear plays as well as 250,000 combined views on HBO Go and HBO Now. The Issa Rae-starrer Insecure drew a combined 1.1 million viewers for its premiere episode generated from 601,000 digital viewers through HBO GO, HBO NOW and HBO ON Demand over a two-week run, as well as 585,000 views from two Sunday night airings, said HBO.

HBO and Cinemax have launched on PlayStation Vue, Sony’s OTT-TV service, with HBO Now, the premium programmer’s separate direct-to-consumer over-the-top offering, debuting on the PlayStation 4 and PS3 consoles.

The launch comes about two weeks after they announced that the debut would come ahead of the October 2 premiere of HBO's much-anticipated sci-fi drama, Westworld.

HBO and Cinemax are also available through PlayStation Vue as standalone channel offerings for $15 each per month. HBO Now, HBO’s standalone OTT subscription service, has also launched on PlayStation 4 and PS3 consoles. 

PS Vue is also debuting Ultra, a package that includes HBO, Showtime and north of 100 sports, movie and TV channels for $64.99 per month (or $74.99 in areas where PS Vue provides access to major live local TV broadcasts).  Ultra complements PS Vue’s existing Elite, Core, and Access packages.

PS Vue is also supported on Roku players and Roku TVs, iOS and Android mobile devices, and Amazon Fire TV devices.

Google Fiber has joined a growing number of distributors for HBO Now, the premium programmer’s direct-to-consumer OTT service that went live in April 2015, and is also integrating access to Spotify. 

Those OTT services are available to Google Fiber customers as add-ons to their current subscriptions, including Fiber 1000, Fiber 100 as well as Internet/pay TV combos, Google Fiber said. For customers who partake, those services will appear on their monthly bills.

Earlier today, HBO announced that its OTT offering would be coming to PlayStation 3 and PS4 consoles ahead of the October 2 premiere of Westworld.

Last month, Home Box Office chairman and CEO Richard Plepler said HBO Now had its strongest quarter yet, but didn’t reveal any new sub numbers. HBO Now ended 2015 with about 800,000 subs, and Jeff Bewkes, Time Warner Inc.’s CEO, said in March that the sub figure was approaching 1 million.

Others with HBO Now distribution pacts include PlayStation Vue, Frontier, Service  Electric Cablevision, Altice (Cablevision Systems), Apple, and Verizon, among others.

It’s a PlayStation kind of day for HBO.

The premium programmer announced Thursday that it has secured a deal to offer HBO and Cinemax via PlayStation Vue, Sony’s OTT-TV service, and will also launch HBO Now, its direct-to-consumer offering on PlayStation 3 and PS4 consoles.

Consumers who subscribe to HBO through PlayStation Vue will also be able to access HBO Now on all supporting devices at no extra charge, they said.

The premium programmer said the distribution on PS Vue is the first time that either network’s live feeds will be offered directly to consumers as a standalone offering without the need for a separate pay TV subscription.

PS Vue will sell HBO and Cinemax for $15 each.

HBO noted that the launches will come ahead of the October 2 premiere of Westworld, a reimagined version of the Michael Crichton story about a Wild West-styled theme park for adults that's inhabited androids.

“PlayStation has always been at the forefront of innovation and we are thrilled to build upon our partnership with them to meet the evolving demands of television audiences,” said Jeff Dallesandro, SVP, worldwide digital distribution and business development at HBO, in a statement. “By expanding the ways that PlayStation users can access unparalleled programming like Game of Thrones, The Night Of and Last Week Tonight, we’re demonstrating our commitment to flexibility and quality.”

“HBO’s award-winning content is a great match for the PlayStation audience, and the addition of HBO and Cinemax builds upon our commitment to bring the best of live and on demand TV to our users.” Added Dwayne Benefield, VP and head of PlayStation Vue. “PlayStation Vue continues to bring industry firsts to users who want a better way to watch TV, including being the first to offer HBO and Cinemax as live standalone channels. Our flexible subscription options offer more choices for consumers than ever before.”

Dragon drama Game of Thrones averaged 25.1 million viewers across the various platforms in its just completed season six, HBO said, up nearly 5 million from the average 20.2 million that watched season five.

HBO came up with that figure when combining linear plays with those on a DVR, on demand and on HBO Go and HBO Now. The digital platforms represent almost 40% of total viewing this season, the network said.

Game of Thrones, showered with 23 Emmy nominations last week, is the most watched HBO series on record, according to the network.

“These record audiences reflect the options we have built into our business model over the last few years. Combining the convenience of HBO On Demand and HBO Go with the subscription flexibility of HBO Now, our programming is being exposed to an ever-growing audience,” said Richard Plepler, chairman and CEO, HBO.

Read more at broadcastingcable.com.

Home Box Office chairman and CEO Richard Plepler said he sees big opportunities in the soon-to-be completed Charter Communications-Time Warner Cable merger, including a window to market the premium channel’s over-the-top service HBO Now to the combined company’s broadband-only customers.

Plepler, speaking at the Paley Center for Media’s Paley Media Council luncheon, said that “new” Charter will have about 6 million broadband-only customers.

“Why wouldn’t you want to bundle HBO Now and share in the profit and growth?” Plepler asked. “That would be up to them, how they want to grow the business. But I think that everybody realizes that’s another means of expanded out brand into consumers.”

Plepler added that there are also opportunities for the traditional HBO premium service. While HBO penetration at old Charter was high, at Time Warner Cable it was much lower.

“There is a huge opportunity for them and a huge opportunity for us to take that penetration up much higher,” Plepler said.

HBO launched the OTT service last April around the premiere of season five of Game of Thrones. Plepler said the service did well around the season six premier April 24, but declined to give subscriber numbers for the service. HBO Now had about 800,000 customers at the end of 2015.

Plepler talked about HBO’s content, adding that the service could possibly dive deeper into the kids’ genre – it purchased Sesame Street last year – or even expand its Hard Knocks professional football documentary franchise into another sport. But he stressed that the premium channel doesn’t need to do anything, but will take advantage of opportunities that it identifies.

“If an idea comes to us that we think is going to fill a hole or allow us to expand a franchise, we’re going to lean into it,” Plepler said.

The HBO chief also added that cord-cutters haven’t had a huge impact on HBO Now, adding that less than 1% of subscribers to the OTT service have cut their pay TV service. He added that the product is more of a “cord-never” phenomenon.  

Sunday’s season six premiere of HBO’s Game of Thrones was popular with digital pirates, according to the latest findings from TorrentFreak.

TorrentFreak, a news site focused on file-sharing and privacy and copyright issues, said the premiere episode drew more 1 million downloads in half a day, with about 200,000 BitTorrent users actively sharing copies of the episode at last check.

According to those findings, pirates are improving their taste for purloined video. have shifted their focus from standard definition (480p) video to high-definition formats, including 780p and 1080p.

“A few years ago roughly 10% downloaded HD copies, which are larger in size, but today this is getting close to 50%,” the site noted in a blog post, noting that the episode drew heaviest interest from pirates in Australia (12.5%), India (9.7%), United States (8.5%) and the United Kingdom (6.9%).

Though the season six premiere was popular among that group, it was not the most-pirated TV show – that dubious distinction still belongs to the season five finale of GoT, which saw 1.5 million downloads in a span of eight hours, according to  TorrentFreak.

TorrentFreak also points out that its figures account only for BitTorrent downloads, adding that “it’s possible that other pirate sources such as streaming and direct download sites did see an increase and that HBO’s free preview to non-subs might have also had an effect on reducing piracy.

On the legitimate side of the digital video ledger, T-Mobile said it saw traffic to HBO Go and HBO Now double. Both apps also happen to support Binge On, T-Mobile’s optional mobile streaming platform that delivers video in 480p and zero-rates the traffic coming in via its partner apps/services.

HBO said it has expanded the reach of HBO Now, its standalone OTT subscription service, to the Xbox One, Xbox 360 and new Samsung smart TVs in time for Sunday’s season six premiere of Game of Thrones.

HBO said the OTT service can be bought directly through the app via 2016 Samsung smart TVs, noting that HBO Now will be offered “soon” on 2015 Tizen-powered Samsung smart TVs (Tizen is Samsung’s home-grown OS for mobiles, wearables, in connected vehicles that became part of its smart TV strategy last year.).

On Xbox, HBO said it’s letting all of those users watch the first episode of season six of GoT after its April 24 premiere (from April 25 to April 28).

The $14.99 per month HBO Now was launched last April. The service ended 2015 with about 800,000 subs, and was approaching 1 million subs, Time Warner CEO Jeff Bewkes said at an investors conference in March.

HBO Now is supported on several other platforms, including the Amazon Fire TV and Fire TV Stick, Apple TV (second-generation and above), select Android TV-powered devices, Roku players and Roku TVs, the Google Chromecast adapter, iOS and Android mobile devices, Amazon Fire tablets, and Web browsers.

“We’re thrilled to give HBO NOW subscribers easy access to all that HBO has to offer through their Xbox console,” Jeff Dallesandro, SVP, worldwide digital distribution and business development at HBO, said in a statement. “Xbox has proven to be a favorite platform for HBO audiences to stream their beloved HBO shows and movies and we are excited about this next big step in our partnership.” 

“The anticipation for Game of Thrones is at an all-time high so we’re thrilled to bring HBO NOW to Samsung TV users in time for the new season,” he added. “By streaming HBO NOW directly on a Samsung TV, consumers can watch epic, event-level programming in premium quality on a big screen—making for a tremendous viewing experience.”  

Time Warner Inc.’s Home Box Office unit, less than a year after launching its over-the-top HBO Now service in the United States, is expanding its OTT reach to Brazil and Argentina later this year.

HBO chairman and CEO Richard Plepler made the announcement at the Morgan Stanley Technology, Media & Telecom conference in San Francisco Wednesday.

“We’re going to go OTT in Brazil and we’re going to go OTT in Argentina as well this year, which is just a further expansion of our international growth,” Plepler said.

Plepler said Brazil is probably HBO’s biggest market in Latin America with about 30 million broadband homes and 70 million TV homes. Although HBO has about 30% penetration in Brazil, Plepler said the addition of the OTT offering will bring a “new dimension,” to the business.

“I think you are going to see more of that going forward,” Plepler said, adding that the Brazil and Argentina launches are being done with partners but declined to name them.

HBO Now launched in the U.S. in April and has since accumulated about 800,000 subscribers. It previously announced plans to launch the product in Spain and currently operates standalone streaming services in 9 countries – the U.S., Denmark, Sweden, Norway, Finland, Colombia, Mexico, Hong Kong, Singapore.

Domestically, Plepler said HBO Now is working on becoming available on more platforms, and will gain carriage on Sony PlayStations later this year.

With about 800,000 paying subscribers at the end of 2015, Time Warner will continue to focus on growing its standalone HBO Now product, stepping up marketing efforts, adding more content and inking new deals with emerging platform providers.

Time Warner launched HBO Now last April, initially targeting the 10 million broadband-only homes across the country.

On an analyst call about Time Warner's fourth quarter, HBO chairman Richard Plepler said that HBO Now still isn’t on two key platforms – PlayStation and Xbox consoles, which have made up about 20% of its online HBO Go viewing. That translates into greater opportunities for expansion.

“We’re excited about getting on additional platforms, we’re excited about bringing  new content to the product which we think is going to draw people in on a daily basis and we’re going to begin to market more aggressively,” Plepler said.

New shows from former Daily Show host Jon Stewart, Vice Media and former ESPN pundit Bill Simmons are in the pipeline for the premium channel. Plepler added that the growth strategy is not exclusive to HBO Now but to the HBO product itself, which saw a 2.7 million increase in total subscribers in 2015.  

“We’re going to work in a multifaceted way to expand our subscriber base and to expand our subscriber revenue,” Plepler said.    

Time Warner, under pressure as activist investors reportedly circle the media giant looking for ways to break it up, didn’t help its case to remain independent as fourth quarter results across all of its divisions came in below expectations.

Time Warner shares fell hard in early trading on the New York Stock Exchange, opening at $56.26 per share, down 12% (6.95 each). The company is scheduled to hold a conference call with analysts to discuss results at 10:39 a.m. By around 11 a.m., during the call with analysts, TWI was up to $60.71, down about 4% from the opening.

(UPDATE FROM THE CALL: TWI, HBO execs call out progress on HBO Now, which has hit 800,000 paying subscribers.)

Overall revenue fell 6% in the fourth quarter to $7.1 billion and adjusted operating income fell 12% to $1.4 billion due to declines at all of the media giant’s operating division. Time Warner did beat consensus estimates on earnings per share-- $1.06 per share versus analysts’ expectations of $1.01 per share – but that was mainly because it paid fewer taxes than expected.

At its Turner networks unit, revenue increased 2% and advertising revenue climbed 5%, but adjusted operating income declined 15% to $781 million, mainly due to a 22% increase in programming expenses. At Home Box Office, revenue increased 6% to $1.4 billion in the quater, but adjusted operating income was flat at $393 million due to programming costs increases and higher marketing and technology expenses associated with its standalone product HBO Now.

In a statement, Time Warner chairman and CEO Jeff Bewkes concentrated on full year results, which were better, with a 3% rise in revenue and a 19% gain in AOI.

“All three of our operating divisions increased revenue and profits while also investing to capitalize on the shift to on-demand viewing and growing worldwide demand for the very best video content,” Bewkes said in the statement.

In a research note, Sanford Bernstein media analyst Todd Juenger wrote that while Time Warner’s results were no surprise – they had basically pre-announced results in January. But how they got there – missing operating income estimates in every segment and beating earnings per share expectations because of a lower tax rate (25% vs. 35% iln the prior year) -- was. 

“This is not a forgiving market environment in general, or for media stocks specifically. We don't think [Time Warner] shares will get a "pass" on a tax beat …,” Juenger wrote

Time Warner Inc. — under scrutiny from a trio of activist investors — has moved in a direction that could make it easier for minority investors to affect change.

In the long run, though, it might just be the company’s size and the volatility of the content business that keeps it together.

Time Warner has quietly amended its corporate bylaws, allowing holders of at least 3% of its stock for at least three years to nominate two members to its board of directors.

Also, per documents filed with the Securities and Exchange Commission on Feb. 3, as many as 20 investors could band together to meet the 3% requirement and elect new directors.

Investors who meet those criteria even can have their board slate included in Time Warner’s proxy statement, saving them the hassle and cost of having to contact other shareholders directly.

Other companies have adopted so-called “proxy access” rules. Time Warner had been asked by some shareholders to do so in the past, but the rules failed to win sufficient votes.

ACTIVISTS CIRCLING

That the company decided to bypass another vote on the matter and go directly to implementation is a bit curious, given reports that activist investors Carl Icahn, Corvex Management chief Keith Meister (an Icahn protégé) and Trian Fund Management head Nathan Peltz are all circling the company.

People familiar with the company said the move is not a reaction to those reports. “The timing is unfortunate,” one person familiar with Time Warner’s thinking said.

But is it? According to several analysts, breaking up or selling Time Warner wouldn’t just be di_ cult — it also wouldn’t make much sense.

Driving most of the breakup speculation has been the 24% decline in Time Warner’s stock price in 2015.

So far this year, the stock is up about 10.5%, mostly on deal speculation. But the entire sector has been in a tailspin, as media companies across the sector are pressured by sluggish TV ratings, declining ad rates and falling subscriber rolls due to cord-cutting.

Time Warner is unique in that it successfully pushed back against 21st Century Fox’s unsolicited $85-per-share offer in 2014 by growing the stock.

Through bold moves like the launch of its standalone HBO online service HBO Now and significant changes at Turner, Time Warner pushed its stock price above the Fox offer, ending that year at $85.42 per share.

The stock continued to grow in the early part of 2015, but slid again in August after The Walt Disney Co. lost about 3 million subscribers. The Disney losses touched off cord-cutting fears for some investors and sent the sector as a whole into a downward spiral.

TOO BIG TO BUY?

With the latest declines, investors are looking for another bold move and the easiest one to make is a breakup.

Wells Fargo media analyst Marci Ryvicker did a sum-of-the-parts valuation of Time Warner that showed potential take-out values for the company ranging from $71.63 to $105.16 per share, but she couched that data with a heavy dose of skepticism. Ryvicker couldn’t see any company in the programming space that was large enough to swallow Time Warner whole. 21st Century Fox, which tried and failed in 2014 to take over the company, is trading at $26.49 per share — about 1.5 times lower than Time Warner at $71.70.

While premium channel HBO and the Turner Broadcasting System cable networks are obviously valuable assets, Ryvicker didn’t see them as having any more value as separate or spun-off entities.

“A sum of the parts is always just math, and to be frank, our math doesn’t matter,” Ryvicker wrote in her January report.

Credit Suisse media analyst Omar Sheikh took it a step further last week, releasing a detailed report mapping out three potential strategies for Time Warner: spinning off HBO, Turner and the Warner Bros. movie studio as three separate entities; spinning off just HBO; and spinning off just Turner.

One of the biggest barriers to any of the spin scenarios is that they would trigger between $10 billion to $11 billion in redemption penalties to certain bondholders, according to Sheikh. Add in the loss of synergies and scale economies inherent in separating the business, and Sheikh estimated that the value range of a Time Warner breakup is just $79 to $89 per share.

Bottom line: Time Warner is worth more together than apart, according to Sheikh.

According to the analyst, Time Warner in its current form could grow cash flow by 25% and net income by one-third over the next three years. And initiatives to slow down content licensing to third-party subscription video-on-demand services like Netflix could help expand multiples. Taking those factors into account, Time Warner could increase its valuation to $90 per share in 12 to 18 months, Sheikh estimated.

BETTER TOGETHER

According to Sheikh, vertical synergies benefits to Turner and HBO from buying content from Warner Bros. would mostly be lost in a Turner spinoff, as the studio wouldn’t have as much incentive to sell its content to the networks and could lose the benefit of having an anchor buyer for its TV and movie output.

A spinoff would also erode horizontal synergies — mainly higher affiliate fees — because Time Warner’s networks would no longer be bundled. And content costs could also rise for Turner and HBO, which would no longer have the economies of scale of being part of a larger parent.

Sheikh said he also believes that separating Turner from HBO eliminates any potential benefit from the premium network’s relationship with Apple for HBO Now.

“These benefits are highly likely to grow over time, in our view, particularly if the cost of developing content is pushed higher by competition from new digital competitors like Netflix and Amazon,” Sheikh wrote.

That could be significant, given the growth the analyst expects from HBO Now. The over-the-top service could have 14 million subscribers by 2020, with 4 million of them churning off the MVPD service, according to Sheikh.

SIDEBAR: For What It’s Worth

Credit Suisse media analyst Omar Sheikh doesn’t believe much is happening via speculation around a possible breakup of Time Warner Inc. Here are three potential scenarios he foresees:

Scenario                        Market Value                Market Value Per Share

Three-Way Breakup . . . . . . .$66.7B-$74.4B . . . . . . . . . . . . . $79-$88

HBO Spinoff . . . . . . . . . . . . . .$67.3B-$75B . . . . . . . . . . . . . .$80-$89

Turner Spinoff . . . . . . . . . . . . $66.7B-74.5B . . . . . . . . . . . . . . $79-$88

SOURCE: Credit Suisse estimates

RELATED STORIES:Viewer Watch 2016: Half-Full or Half-Empty? | Embracing the Enemy: OTT Services Pose Big Risks, Bigger Opportunities

Faced with rapidly changing consumer habits, programmers and multichannel video providers have spent much of the last five years bulking up their offerings to provide more content on additional platforms.

Like the inhabitants of a besieged medieval town, they’ve hunkered down inside the traditional pay TV ecosystem, devoting enormous resources to building up their defenses by adding new products like TV everywhere or by improving existing bundles with faster broadband speeds or even Gigabit offerings.

All of that changed in 2015. With over-the-top video usage doubling on an annual basis, a growing number of programmers and operators decided it was time to step outside traditional pay TV distribution methods and take the fight directly into enemy territory by offering new over-the-top services such as Dish Network’s Sling TV or HBO Now.

Much of this can be traced to the subject of Multichannel News’s annual Viewer Watch survey — changing video-usage patterns that have produced a slump in TV ratings and slight declines in pay TV subscriber numbers.

“There is a new generation that is consuming TV differently,” Magna Global executive vice president and director of global forecasting Vincent Letang said. The New York-based firm has forecasted a 6% drop in pay TV subscribers and flat or sluggish TV advertising in upcoming years.

“We have been talking about cord-cutting for a few years, and it wasn’t really happening,” Letang said. “But now it is happening, because young people are adopting MVPD subscriptions at a significantly lower rate than previous generations.”

Horowitz Research president Howard Horowitz added, “You can look at it as a glass and say it is half-full or half-empty, depending on your PR objective of the data.” Though the number of cord-cutters remains small, “the market changes aren’t trivial,” Horowitz said. “Complacency is out. You have to take the market seriously and pay attention to millennials by providing them with the kind of services they want.”

Companies must also carefully parse these video-industry developments to better understand the forces that are changing consumer habits, Horowitz and others said.

CORD-CUTTING CONFUSION

Two of the thorniest topics are cord cutting and the habits of the millennial 18-to-34-year-old set.

“We’ve spent a lot of time talking about and reacting to cord-cutting,” Bruce Leichtman, president and principal analyst of Leichtman Research Group, said. “But I think that is a dangerous term that leads people to bad assumptions, bad conclusions and bad decisions, because they are really nonsubscribers.”

The ranks of those nonsubscribers are clearly growing, though not at the precipitous rate some had predicted. Total multichannel video subscribers fell from 100.7 million in the fourth quarter of 2013 to 100.5 million in the fourth quarter of 2014, according to SNL Kagan.

Those declines, however, accelerated in the first nine months of last year, falling by more than 1 million subscribers to 99.4 million in the third quarter of 2015, SNL Kagan principal analyst Ian Olgeirson noted.

Some of this has been attributed to economic issues. The U.S. housing base has increased by about 4.5 million, according to Leichtman, but home ownership is actually down by 1 million and there are 5 million more renters.

“Renters tend to be younger, they tend to be more mobile and all of these things have always correlated a with a lower likelihood to subscribe to multichannel TV,” Leichtman said. “The number of people dropping subscriptions is about the same as it was a decade before we started talking about cord-cutting. The difference today is that fewer people are coming into the top of the funnel.”

Satellite-TV and telco providers have been also more cautious in pursuing new subscribers given the high cost of hook-ups, Leichtman and Olgeirson said.

The declines also have occurred during an economic recovery, Olgeirson said, so other factors are also at work. “A more likely source of erosion than economics comes from changing viewing patterns and the fact that [viewers] can find programming from other sources,” he said.

Millennials can’t be viewed as a monolithic group, researchers have cautioned. For instance, a recent analysis of millennials by Nielsen found 30-to-34-year-olds living in their own home with children had a pay TV penetration rate of 81.4%, versus a 72.4% rate among 18-to-24- year-olds living in their own home with no children.

MILLENNIAL DIVERSITY

“People talk about millennials as if they are a unified group, but of course they aren’t,” Nielsen senior vice president of audience insights Glenn Enoch said.

Nielsen’s study also analyzed how these households changed their pay TV subscriptions over time, Enoch noted. “Our data shows that householders aged 18 to 34 are more likely to drop cable, but they are also the most likely to add it,” he said. Lower-income homes were also “more likely to add and drop a multichannel subscription,” he added.

That’s due to the fact that younger and lower-income households are more likely to rent and drop their pay TV subscriptions when they move. But that doesn’t mean that viewing patterns, particularly among the young, aren’t changing dramatically.

“The big theme that we are seeing in video consumption is how expansive and immersive the viewing ecosystem has become with so many devices and options,” Viacom executive vice president and chief research officer Colleen Fahey Rush said. “It used to be that you had to wait to watch a show one night a week and wait until work the next day to talk about it.

“Now, you can follow the characters and cast on Twitter. You can watch shows on apps and go back and watch all the old seasons on so many different places. Everyone has a TV in their hands, a smartphone, which is an amazing tool for discovery and loyalty,” she said.

“Most of the growth is on mobile, OTT devices and the connected TV,” ESPN senior vice president of global research and analytics Artie Bulgrin said. For example, the WatchESPN app set viewing records in September with 11 million unique visitors — up 50% from a year earlier — watching 2.2 billion minutes of video for a 92% bounce rate.

That trend has been particularly evident with younger viewers. In the third quarter of 2015, TV viewing by 18-to-24-year-olds fell by 2 hours and 4 minutes from a year earlier, per Nielsen, while viewing on multimedia devices such as Roku was up 34 minutes, to 1 hour and 25 minutes a week.

Not surprisingly, these shifts are have affected digital and TV ad spending. “In 2016 digital advertising will overtake TV in the U.S. for the first time ever.” Magna’s Letang said.

Despite this, TV advertising was stronger in the second half of 2015, so spending in 2016 and 2017 isn’t likely to see the type of declines that occurred in 2013 and 2014, Letang and others noted.

“There is a pretty significant amount of truly premium TV viewing just not being included in current ratings definitions,” Pivotal Research Group senior research analyst for advertising Brian Weiser said. “Viewing is not anywhere near down as much as people think it is. It might even be up, but I’ll go with flat.”

The TV-advertising picture also isn’t as bad as some believe. “The third quarter came out reasonably well and the fourth quarter looks even better,” Weiser said. “Based on the idea that digital is eating TV’s lunch, the overwhelmingly dominant view of TV advertising is pessimistic. But TV still remains the most efficient way to build awareness.

“The problem has been that ad spending has been weak, not that we are seeing a secular shift of TV money to digital.”

While it’s no surprise that Netflix is the top OTT subscription service, a new study from Parks Associates offers a deeper view into how other services are stacking up.

The research firm’s latest OTT Video Market Tracker rounds out the top 10 subscription OTT video services in the U.S., based on several data sets, including subscriber volume, consumer surveys, network traffic data and info supplied the providers themselves. Here’s how the Parks list shakes out, revealing that three of the top ten come from the sports realm, and that 40% of them were launched within the last two years:

1. Netflix

2. Amazon Video

3. Hulu

4. MLB.TV

5. WWE Network

6. HBO Now

7. Crunchyroll

8. NFL Game Pass

9. The Blaze

10. Sling TV

“The number of new services and continued growth for many existing services show the vitality of the OTT video services market in the U.S.,” said Brett Sappington, director of research at Parks Associates. “While Netflix holds a substantial lead, new and emerging OTT services are establishing their own place in the market.”

Newcomers have indeed made strides. Among the top 10, HBO Now debuted in April, while Sling TV, Dish’s OTT-TV service, launched on a national basis in February.

Though Netflix remains in OTT’s catbird seat, Parks also found that more consumers are gravitating to more than one service – more than 25% of U.S. broadband homes used two or more OTT video services in the past 30 days (see chart).

Additionally, 59% of the homes studied take an OTT video service subscription that’s based on a monthly fee. 

Add Starz to the list of premium channels going over-the-top, as the home of original series like Outlander and Da Vinci’s Demons says it could have deals with new distribution partners in the “coming weeks.”

Starz would join Home Box Office, which launched HBO Now in April, and Showtime, which began offering its own OTT streaming product in July.  The news comes as Starz said it shed about 200,000 subscribers in the third quarter (its more widely available Encore channels lost 800,000 subscribers in the same period) mainly due to what it called “merger-related distractions” at some of its distribution partners.

Those subscriber decines helped send Starz stock down 10% ($3.69 per share) to $33.51 each on Friday.

In a conference call with analysts to discuss third quarter results, Starz CEO Chris Albrecht said that the OTT moves are being made to unlock “opportunities to distribute our content beyond the traditional cable bundle, tapping into the unmet demand we are seeing for our content, while at the same time still cultivating our core business with MVPDs.”

He added that in the coming weeks Starz plans to complete deals with “several new distribution partners.” He declined to name them.

Starz has been the source of intense merger speculation itself over the past few years, and has been rumored to be in talks with AMC Networks,21st Century Fox, and Lionsgate but has been unable to secure a deal. The entrance into the OTT arena comes as a bit of a surprise as the channel had earlier tried to positon itself as the “house brand” for its MVPD partners, serving as the exclusive MVPD premium service while its peers pursued digital distribution.    

Albrecht said the OTT service would expand the universe for both Starz and its MVPD partners.

But not everyone was convinced.

In a note to clients, Morgan Stanley media analyst Ben Swinburne wrote that like its larger premium counterparts Home Box Office and Showtime, Starz believes it can take advantage of the 10 million households that don’t subscribe to pay TV. But Swinburne noted that Starz doesn’t have the scale of HBO and Showtime. And the premium channel could face some backlash from distributors.

“Recall that in late 2012, Starz was forced (by our estimates) to accept ~10% rate step-downs from two large MVPDs – we believe in part a backlash from Starz' prior decision to distribute via Netflix in 2009-2011,” Swinburne wrote. “Therefore, while new distribution partners have the potential to drive revenue upside (particularly as new entrants traditionally pay high-end rates) we see significant offsetting downside risk to Starz' traditional revenue streams.”

Albrecht added that the decision to offer an OTT product is in line with Starz’ overall strategy to maximize the value of its content and isn’t merely following HBO and Showtime.

“We've decided that the time to move into that arena is now. We're actively talking with several companies,” Albrecht said.

Richard Plepler believes that  MVPDs such as Comcast, Charter Communications and Time Warner Cable are missing a chance to make a deeper connection with broadband-only customers by not partnering up to distribute HBO Now, the premium programmer’s stand-alone over-the-top subscription offering.

“This is not exclusive to our new digital partners like Apple and Android and Roku,” Plepler said Tuesday at the WSJD Live event  in Laguna Beach, Calif. “This also can be a tremendous opportunity for our traditional distributors…We’re saying to our partners, ‘Join us’ – our new digital partners and our traditional partners.”

Many of those distributors have yet to get on board.

“If you’re Brian (Roberts) and you have 6 million broadband subs, why would you not bundle HBO and share that revenue with us?,” Plepler asked,  according to Variety. “Why would you give up that real estate and not be paid for it? I don’t understand it.”

He also reiterated his view that HBO Now’s approach does not cannibalize their traditional pay TV businesses, noting that just 1% of HBO Now subscribers were former pay TV customers. HBO has not released subscriber numbers for HBO Now, though the service is expected to generate losses in 2015.

HBO Now went live on April 7, and has managed to strike distribution deals with Apple, Cablevision Systems, and Verizon Communications, among others.

HBO Now, HBO’s new standalone OTT service, has launched an app for Roku players and integrated Roku TVs.

Roku users can subscribe to HBO Now for $14.99 per month directly via the HBO Now “channel” on those devices and are in line for a 30-day free trial offer. Roku users who sign up can watch HBO Now on their devices or at HBONow.com.

Support for HBO Now comes just days after Roku introduced the 4K-capable Roku 4 model,  a new operating system and a refreshed mobile app.

HBO Now also supports  iOS and Android mobile devices, the Amazon Fire TV, select Android TV devices, Apple TV, and the Google Chromecast.

HBO Latin America said it will soon launch a new a la carte version of HBO Go in the region for broadband-only subscribers.

The service, which will feature content from the HBO/Max premium channels, will initially launch in Columbia by the end of 2015, the company said.

HBO Go is currently available as a complement to the premium HBO/MAX subscription package offered through MVPDs in the region. It offers more than 2,500 titles.

The new offering for broadband-only subs will be offered in Latin America, Brazil and the Caribbean, and distribution deals and pricing on the à la carte version of HBO Go will be announced jointly with partners prior to launches in each market.

The new HBO Go platform will also feature a new UI, support multiple languages (Spanish, English or Portuguese), program audio tracks and subtitles, and a feed of the linear channel.

“We have seen changes in content consumption habits and are launching this new HBO GO platform as an à la carte service in response to those trends,” Emilio Rubio, CEO of HBO Latin America, said in a statement. “We are creating options and adding more flexibility to our model and for our distributors, giving consumers the choice to enjoy the Premium content of HBO/MAX in the manner they want.”

In the U.S., the HBO Now standalone service. launched in April, has distribution deals with Apple, Cablevision Systems and Verizon Communications, and is currently supported on several platforms, including iOS and Android mobile devices, Web browsers, the Amazon Fire TV, Roku devices, select Android TV devices, the Apple TV box, and the Google Chromecast. 

Android TV, the new Google OS for smart TVs and streaming players, has forged a slew of new partnerships with programmers, set-top and TV makers and even a couple of MVPDs.

Following recent launches on Android mobile devices, HBO Now, the network’s standalone OTT service, is now supported on select Android TV devices, including Sony and Sharp connected TVs that use the new Google OS. That follows Android TV's recently added support for Showtime’s OTT direct-to-consumer service, CBS All Access, and apps from WWE and UFC.

Other streaming apps on Android TV include Fox News, The Weather Network, FXNOW, Fox Sports Go, Epix, Sling TV, Crackle, and apps from HGTV, Travel Channel, Food Network, Hulu, Netflix, AOL On, MLB.tv, PBS Kids, and Pluto TV, among others. 

The Nvidia Shield, Nexus Player, Philips TVs and the Razer  Forge TV are among others in the early batch of Android TV-powered devices.

As noted in this blog post by George Audi, business development manager, Google Play, Google also has also signed on Hisense and TCL to make integrated Android TV-powered sets. Notably, Hisense and TCL are also Roku TV partners.

On the pay TV front, Audi also noted that set-top makers Pace (which is in the process of being acquired by Arris), Sagemcom and Technicolor will be working to bring Android TV-based boxes to pay TV operator partners, adding that KDDI and Telecom Italia among the early takers from the MVPD sector. 

The expanded Android TV partnerships comes on the heels of Google's introduction of a second-gen TV-connected Chromecast streaming adapter and the Chromecast Audio dongle. 

Amazon wasted little time pitching HBO Now to customers after extending support for the standalone OTT offering to Fire TV boxes and the Fire TV Stick.

Amazon, which also supports HBO Now on its Fire tablets, emailed a promo on Sunday to customers with the subject line: “Get HBO Without a Cable Subscription” –  a message that is obviously targeted to cord-cutters and consumers who have never taken a pay TV subscription, but might be inclined to tap into the OTT offering to gain access to Game of Thrones, True Detective, Ballers and other HBO originals.

“Big premieres are available at the same time they air on TV,” Amazon’s promo notes, adding that new customers can jump on a 30-day free trial of HBO Now.

HBO Now, which runs $14.99 per month, is also supported on the Google Chromecast, the Apple TV, Android and iOS mobile devices, and Web browsers, and will be coming to Android TV-powered devices.  HBO Now distribution partners include Apple, Cablevision Systems and Verizon Communications.

The latest Amazon Fire TV and Fire TV Stick integration will give HBO Now the ability to ride the promotional power of Amazon.  HBO hasn’t announced sub figures for HBO Now, though one analyst puts it at as high as 1.9 million.

HBO Asia and StarHub of Singapore have inked a new deal that will enable StarHub to offer HBO Go to via a new standalone streaming service without requiring an underlying pay TV subscription.

That new service, called StarHub Go, will initially provide more than 300 hours of HBO and  Cinemax original series, including Game of Thrones, True Detective, Ballers, The Brink, Veep, The Knick, Strike Back, Rome and The Newsroom, to subs who take the service’s Premium Pack, which sells for SGD 19.90 (US$14.20) per month.

 To prime the pump, StarHub is offering the premium package for SGD 1.99 (US $1.42) per month for three months to customers who sign up by September 30.

The service is compatible with iOS, Android and Windows 8.1 devices and on browsers equipped with the Silverlight player.

HBO, which recently launched a standalone OTT service in the U.S. called HBO Now, expects to expand the its catalogue for StarHub Go to about 1,000 hours by the end of 2015.

The companies also announced that HBO On Demand, HBO Asia’s subscription video on demand service, will be offered at no additional cost to subscribers of all HBO channels via the StarHub Go platform. 

“There’s so much demand for HBO’s award-winning content that delivering them digitally on multiple devices for our fans to watch on their own terms has been foremost priority,” Jonathan Spink, CEO of HBO Asia, said in a statement. “Introducing HBO Asia’s standalone streaming service on StarHub Go without a traditional pay TV subscription is a natural progression for us to reach new audiences.”

“Together, StarHub and HBO have achieved many milestones over the last 22 years, from our carriage of a single HBO channel on Singapore Cable Vision (SCV)’s ultra-high frequency (UHF) band to the current stable of five channels on both cable and IPTV,” added Ms. Lee Soo Hui, head of StarHub’s Media Business Unit, StarHub. “The launch of HBO GO takes our partnership to new heights by delivering HBO’s content to viewers all across Singapore through our StarHub Go service. We are also pleased to inform our StarHub TV customers that following the enhancements made to HBO On Demand, all five HBO channels will be broadcast in high definition by the end of the month.”

Time Warner Inc. reported higher earnings as cost cuts at Turner Broadcasting boosted operating income. Profits were lower at HBO as it spent on marketing and technology to launch HBO Now.

Second-quarter net income rose 14% to $971 million, or $1.16 a share, from $850 million, or 95 cents a share, a year ago.

Revenue rose 8% to $7.3 billion.

The results were ahead of Wall Street expectations. The company also reaffirmed its guidance for full-year results.

At Time Warner’s Turner Broadcasting unit, adjusted operating income rose 20% to $1.1 billion as revenue rose and costs — including programming costs — declined. Turner’s revenue rose 3% to $2.8 billion.

Ad revenue was down 1% because of the strong dollar. Domestic ad revenue was up because of growth at its news networks and strong March Madness sales. Those gains offset the absence of NASCAR programming and having fewer NBA playoff games.

Adjusted operating income fell 8% at HBO, which had higher marketing and technology costs because of the launch of the HBO Now streaming service. Revenue at HBO was up 1% to $1.4 billion.

Read more at broadcastingcable.com.

Starz CEO Chris Albrecht said the premium channel is evaluating the possibility of launching its own standalone, direct-to-consumer service a la HBO Now and Showtime’s OTT service, but said that at the moment it is concentrating on its Starz Play TV Everywhere  strategy.

Albrecht, speaking on a conference call with analysts to discuss second quarter results, said that the company continues to roll out its Starz Play service, which lets current Starz customers access content on multiple devices. He added that new platforms and devices will be introduced  for the service, which is sold through its relationships with multichannel video programming distributors (MVPDs), in the future.

Albrecht said Starz believes there is still value in TV Everywhere, and acknowledged that other players like Home Box Office and Showtime have launched standalone products recently. While Starz is keeping an eye on those products, he said he has yet to see hard data concerning such services.

“We certainly see an increased interest; new distributors [are] placing value on premiums, ” Albrecht said of a Starz direct-to-consumer product. “We think that is a good story for Starz. We are evaluating what others are doing; it’s early days, we have yet to see any hard reported data on the benefit of that to brands. That said, I can tell you that a lot of people are interested in distributing Starz. We have the full capability of following in the footsteps of what other premium brands are doing. We are evaluating all of these things on the basis of which ones we think provide the best net benefit to Starz.”

Los Angeles – A strong feeling that going over-the-top would create incremental growth for HBO was a primary reason why the premium programmer pulled the trigger on HBO Now, its new  standalone offering.

“It was done to grow,” Michael Lombardo, HBO’s president of programming, said here Thursday at NewBay Media’s Next TV Summit during an interview with Mark Robichaux, editorial director for Broadcasting & Cable and Multichannel News.

Lombardo said the stand-alone offering, currently offered by Apple and Cablevision Systems and coming soon to Google’s Android and Android TV platforms, was made to resonate with cord-cutters, cord-nevers and other younger consumers who are steering clear of big bundles as they get out of college and land their first jobs.

For them, “the idea of paying $125 per month for a cable package in addition to starting life [as an adult], is daunting,” he said.

While time will soon tell if HBO’s strategy will succeed, the programmer was willing to take a shot.

“It just felt that it's better to be in front of the pack than the last guy there,” Lombardo said. 

And the pay TV models are shifting as more and more content options become available to consumers.

“You can no longer rely on someone channel surfing to find you,” Lombardo said. “You can no longer rely on Comcast marketing you. You have to have a relationship with the viewer that means something." 

Lombardo also talked about HBO’s decision to offer HBO Now through distribution partners rather than do a direct-to-consumer play.

“We are determined to figure out a way to be ubiquitous in terms of who's distributing us,” he said. “When we made decision to go over-the-top, we made a decision not to handle credit and collections.”

Given the way viewing habits have shifted away from linear, appointment-based viewing to on-demands, Lombardo said he has been surprised that ratings for Game of Thrones have left The Sopranos in the dust (the finale for season five of GoT delivered a record 8.1 million viewers for the network).

“We never saw it [Game of Thrones] as a numbers phenomenon,” Lombardo said. “When we launched Game of Thrones it was a different world,” he added, noting that there’s now a multiplicity of premium networks, basic cable networks and emerging platforms that are all in the business of delivering scripted, branded content.

“Not in our wildest dream” did HBO expect to see ratings for GoT surpass The Sopranos, Lombardo said.

And what about the biggest question GoT fans had following the end of season five: Is Jon Snow really dead?

“I accepted the fact that there were no rules and anybody could go, but somehow [I thought] Jon Snow seemed off-limits,” Lombardo said. “As of today, he’s still dead.”

One thing that won’t happen: “They’re not going to bring him back for ratings…they’re scripting season six as we speak, and I’ll let you know when I read the outlines,” Lombardo quipped.

Lombardo also sees much more GoT to come for HBO as the show forges ahead into storylines that surpass the books. “We’re in season six. I’m hopeful for a seven and eight.” 

Apple won't be the only platform getting access to Showtime’s new standalone streaming service, when it comes online in early July.

The premium programmer announced Monday that it will also offer the OTT, standalone version of Showtime on Roku players and Roku TVs. Additionally, the Showtime service will become available via Sony’s PlayStation Vue, the new virtual MVPD that launched services in three markets – New York, Chicago and Philadelphia – in mid-March.

Showtime has not identified a specific launch date for the new standalone streaming service and Showtime's availability on an a la carte basis via PlayStation Vue, but it will become available, for $10.99 per month, on all of those platforms prior to the July 12 season premieres of Ray Donovan and Masters of Sex. Roku customers who sign up in July will be offered a 30-day free trial subscription to the new Showtime standalone offering.

Update/Clarification: At launch, consumers can subscribe to the Showtime standalone streaming service directly from the Showtime app on Apple and Roku devices. At sign up, consumers will be asked to create a Showtime account which they can then use to watch the service across all Apple and Roku devices as well as online at www.showtime.com, regardless of where they initially purchased their subscription, the programmer noted. PlayStation Vue, meanwhile, is a separate cloud-based TV service where consumers can access the network’s programming nationwide for an a la carte monthly price of $10.99.

Showtime unveiled the standalone service on June 3, announcing it would be offered on Apple devices, including the Apple TV, the iPhone and iPad, for $10.99 per month. Showtime will also offer the OTT service, which features the channel’s east and west coast feeds and a video-on-demand library, on Web browsers.

HBO Now, the standalone OTT service launched by HBO in April, is distributed by Apple and Cablevision Systems and, this summer, will also become available via Google Play, extending access to Android-powered platforms, including those that run on the new Android TV OS.

Showtime Anytime, the programmer’s authenticated TV Everywhere service that requires users to have a pay TV subscription, is currently offered on Web browsers, iOS and Android mobile devices, Roku players and Roku TVs, the Amazon Fire TV box and Fire TV Stick, Xbox 360 and Xbox One, Apple TV, and is also optimized for the Google Chromecast streaming adapter.

“We are thrilled that Roku and Sony have come on board for our launch in early July,” Matthew Blank, chairman and CEO of Showtime Networks, said in a statement. “Both platforms have distinct and loyal audiences and together they will build on our service and greatly expand the number of homes that will have access to the SHOWTIME service over the internet. This is fundamental to Showtime’s strategy of putting the choice in the hands of the consumers regarding how, when and on what unique devices they watch our programming.”

“Showtime has been a great partner over the years and Roku’s inclusion as an initial launch platform for the SHOWTIME streaming service speaks volumes to our shared commitment to offer consumers the best entertainment experience available,” added Steve Shannon, general manager of content and services at Roku.

“We’re thrilled to launch SHOWTIME within PlayStation Vue,” said Dwayne Benefield, vice president, head of PlayStation Vue at Sony Network Entertainment International. “We can’t think of a better partner with whom we can begin to extend our revolutionary television experience to a nationwide audience."

After years of speculation and rumor about the mythical Apple television, here’s another round of it that might put the topic to rest for a while… Apple, The Wall Street Journalreported Monday, quietly shelved the project more than a year ago after finding that it would be difficult to produce a product that could set it apart from the pack.

Apple “searched for breakthrough features to justify building an Apple-branded television set” but came up short, the paper reported, citing unnamed sources.

Such breakthroughs that were apparently under consideration sound pretty ho-hum – Ultra HD/4K display, sensor-equipped cameras to make video calls, among them.

But Carl Icahn, in an open letter on Monday to Apple CEO Tim Cook holding that the company’s shares are worth a lofty $240 (they’re trading at about $130 per share at the time of this writing), remains confident that Apple will still make a go at the TV, as well as connected cars.

“Apple is poised to enter and in our view dominate two new categories (the television next year and the automobile by 2020) with a combined addressable market of $2.2 trillion, a view investors don’t appear to factor into their valuation at all,” Icahn wrote.

With respect to the long-rumored Apple television, that’s sort of a replay from October 2014, when Icahn expressed confidence in another open letter that Apple would introduce a 4K set sometime in fiscal year 2016.

Icahn wrote this week that he still expects Apple to start selling two Apple television sets – UHD models with 55-inch and 65-inch screens, in FY 2016, so at least he’s consistent. He also sees Apple generating revenue of $15 billion in FY 2016 on sales of 10 million units, rising to $37.5 billion on 25 million units in FY 2017. 

“[W]e view television’s role in the living room as a strategically compelling bolt-on to the Apple ecosystem,” Icahn wrote, adding that he also plays into the rumor that Apple is preparing to launch its own "skinny bundle” of pay-TV channels and a new Apple TV device.

Icahn then went on CNBC, saying that he read the WSJ article but stands by his belief that Apple will still pull the trigger on its own television set.  

For now, Apple’s public video strategy continues to center on the current generation (and recently price-reduced) Apple TV device, and support for services such as HBO Now, HBO’s new stand-alone OTT service.

But when the HBO Now deal was announced, Cook open the door to much more, noting that the aim of Apple is to “reinvent the way you watch television, and this is just the beginning.”

Led by better than expected growth in the U.S. and other corners of the globe, Netflix added a record 4.9 million new streaming subs worldwide in the first quarter, soundly beating its forecast of 4.1 million.

Netflix ended the period with 59.62 million subs, and expects to add a more modest 2.5 million in the second quarter.

In the U.S., Netflix added 2.28 million subs, extending its total to 41.40 million. It expects to add 600,000 in the second quarter.

On the international front, Netflix added 2.6 million subs, giving it 20.88 million, and expects to add another 2.9 million in the category during Q2 as it benefits from recent launches in Australia and New Zealand, which adds 8 million broadband subs to its addressable market. Netflix is slating a launch in Japan later this year.

While international subs were on the upswing, Netflix said the strong U.S. dollar hit earnings. Netflix posted net income of $24 million (38 cents per share), versus $53 million (86 cents per share) in the year-ago period. Revenues climbed to $1.4 billion in Q1 versus $1.07 billion in the year ago period.

Those reduced earnings didn’t hurt Netflix’s stock, which is was up $54.54 (11.47%) to $530 each in after-hours trading Wednesday. Netflix also announced it is seeking shareholder approval for an increase in our authorized shares, and that, if approved, expects to recommend a stock split. 

Netflix does not publicize streaming figures on a show-by-show basis, but said the third season of original series House of Cards “had its biggest launch yet in terms of viewers.”

Expect Netflix to keep pressing its original content. 

“We are increasingly spending on the promotion of our original content rather than emphasizing attributes of the Netflix brand and service that are now more familiar to consumers,” Netflix said in a letter to investors. “Early tests in international markets suggest this content focus is aiding member acquisition.”  

Netflix also plans to roll out an enhanced TV UI in the second half of the year, and is working on new ways to promote Netflix originals “using our data to help identify which members would be most likely to enjoy each original title.”

Netflix also said it has had second thoughts about its decision to work with ISPs in Australia on a non-metered version of its service that helped subs sidestep data consumption caps.

Though this sort of zero-rated service is common in Australia, “[w]e should have avoided that and will avoid it going forward,” Netflix said. “Fortunately, most fixed-line ISPs are raising or eliminating data caps in line with our belief that ISPs should provide great video for all services in a market and let consumers do the choosing.”

Netflix also weighed in on HBO Now, HBO’s new stand-alone OTT service, reiterating its believe that Netflix and HBO aren’t substitutes for one another.  It also views virtual MVPDs such as Sling TV and PlayStation Vue “as more competitive to the current pay TV bundle than to Netflix which is lower cost, has exclusive and original content, and is not focused on live television.”

Traffic for HBO Go, coupled with a tiny contribution from the new HBO Now service, saw healthy gains during Sunday night’s season five premiere of Game of Thrones, but those levels were  still a relative blip when compared to the OTT video being generated by Netflix and YouTube, according to streaming data from bandwidth management specialist Sandvine.

Taking a snapshot of the traffic mix from one fixed network (the ISP in question was not identified) in the eastern U.S. on Sunday (April 12) at 9:30 p.m. ET, Sandvine found that Netflix represented 33.5% of downstream video traffic share, followed by YouTube (15.7%), HBO Go (3.4%), Amazon Instant Video (1.9%), and HBO Now (0.7%). 

Update: Sandvine confirmed that those figures do not factor in HBO traffic originating with Sling TV, Dish Network’s new OTT pay TV service for cord-cutters. For its part, Sling TV held firm under the stress of HBO-driven traffic on Sunday night, though a subset of Sling TV subs on the Roku platform did complain of slow app load times. 

“This is one network, on one day, and Internet traffic does fluctuate, so it is important to not take these figures to be representative of North America,” Sandvine’s Dan Deeth explained in this blog post, which noted that Sandvine was able to provide its customers with a software update on Friday (April 10) that allowed them to measure HBO Now traffic in time for the GoT premiere.  

Still, this limited view of traffic showed that HBO Go, HBO’s authenticated TV Everywhere service, did see a sizable jump on Sunday. In its Global Internet Phenomena Report, released in November 2014, Sandvine found that HBO Go accounted for about 1% of downstream traffic during peak periods in the U.S.  But Sandvine also has found that HBO Go usage is typically much higher on Sunday nights versus other evenings during the week.

As for HBO Now’s comparatively small showing, Sandvine chalked that up to the fact that the service had been launched for less than a week, had limited access (offered initially via Apple and to Cablevision Systems’s Optimum Online and subs), and had to fight against typical HBO Go password sharing.

“Even with its minimal impact today. HBO NOW will be interesting to track in the coming months to see how much (and how fast it grows),” Deeth wrote. 

RELATED STORY:'Game of Thrones’ Slays 7.9 Million Viewers

Related Story:

'Game Of Thrones’ Slays 7.9 Million Viewers

The over-the-top premiere of the fifth season of HBO’s Game of Thrones on Sunday night came off nearly without a hitch, as a subset of Sling TV customers experienced issues when trying to catch the live stream of HBO via the Roku platform.

The premiere episode of GoT drew a lot of attention following the launch of HBO Now, HBO’s new unbundled, stand-alone service initially offered via Apple and Cablevision Systems’ Optimum Online service, and the launch of HBO on Sling TV, Dish Network’s over-the-top TV service for cord-cutters. While HBO Now is VOD-only, Sling TV's version of HBO includes a linear live stream and VOD. 

Users on Twitter and TV Predictions detailed some of the issues Sling TV had on Roku Sunday night.

Sling TV, which struggled with streaming demand issues during the semi-final games of the NCAA men’s basketball tournament on April 4, got an improved result with GoT on Sunday, though Sling TV CEO Roger Lynch acknowledged in this blog post that some of its customers experienced slow load times when accessing the app on the Roku platform on Sunday night. 

In anticipation of the new season of GoT, Sling TV moved ahead on some service enhancements and upgrades designed to reduce overhead and server load during periods of heavy viewership. Those “core system” updates aimed to improve the experience “from account creation to service delivery,” Lynch noted. 

“Overall, we successfully delivered a great experience to the vast majority of our customers,” Lynch added. “Where we truly improved was among those who may have experienced streaming errors in the past – we saw tremendous gains.”

Sling TV’s customer care Twitter handle (@SlingAnswers) addressed subscriber issued directly on Sunday night, directing them to restart the Roku app while also noting that that subscribers who missed part of the live feed could watch the season five premiere of GoT from the beginning by watching it on-demand.

BTIG analyst Richard Greenfield got a heavy dose of Game of Thrones on Sunday night, tweeting that he was able to view the live and on-demand version of the show on Sling TV as well as via the HBO Now service without issue.

HBO, meanwhile, was dealing with other issues ahead of Sunday’s premiere, as the first four episodes from the new season leaked online. HBO said it believed the copies “originated from within a group approved by HBO” to receive those episodes, adding that it is “actively assessing how this breach occurred.”

HBO is entering the daily news business via an expanded relationship with Vice Media.

Under a four-year pact that HBO calls its “most expansive programming deal ever,” the premium service will present five, 30-minute, Vice-branded newscasts 48 weeks per year.

The news content also will be available via a channel on HBO Now, the OTT service that will bow within the Apple device ecosystem with the fifth season premiere of megahit Game of Thrones on April 12.

Also part of the agreement, financial terms of which were not disclosed, HBO has extended its weekly commitment to Vice docuseries for four more years and will increase the number of shows from 14 to 35 annually.

 Moreover, HBO will present 32 Vice-branded specials over the next four years.

“This deal, simply put, allows Vice the freedom to go after any story, anywhere we find it – and to do so with complete independence,” said Vice Media founder and CEO Shane Smith. “This deal is a tremendous gift and a tremendous opportunity, and we at Vice realize this.”

Apple is in talks with cable programmers and most major broadcasters, including ABC, CBS and Fox, about a plan to launch an over-the-top pay TV service this fall that would feature about 25 channels, The Wall Street Journalreported Monday.

It’s the latest in a flurry of rumors involving Apple and its plans to introduce a pay TV offering. Re/code reported last month that Apple had entered licensing discussions with programmers about an OTT service that would offer bundled subsets of programming and rely on an Apple-crafted user interface.

The WSJ said Apple’s current TV talks don’t involve NBCUniversal, claiming that they had a “falling out” after Apple’s earlier discussions with Comcast didn’t bear fruit.

Last March,industry sources confirmed reports (subscription required) that Apple and Comcast had been talking for at least two years about a deal that would enable an Apple-powered device to offer a mix of live TV and other subscription video services in partnership with the MSO.  At the time, The Wall Street Journal said Apple was seeking a deal that allow it to provide its own UI and to deliver video services over managed IP connections that did not mix with broadband service traffic, and get a cut of the subscription fees. But those talks didn’t get very far, with one industry source saying that “Apple just wants too much.” Comcast, meanwhile, has pushed forward with X1, an IP-capable next-gen video service.

As for Apple’s current plans, the WSJ said Monday that it intends to offer a “skinny” bundle anchored by channels such as CBS, ESPN and FX, and aim for a price in the range of $30 to $40 per month.

Apple’s premium video ambitions got a lift last week when it was named the temporary exclusive distribution partner for HBO Now, a stand-alone OTT service that will initially sell for $14.99 per month and launch in time for the season five debut of Game of Thrones. (Cablevision Systems is the first cable MVPD to strike a distribution deal for HBO Now.)

In a bit of foreshadowing when he announced the HBO partnership, Apple CEO Tim Cook said it is now Apple’s aim is to “reinvent the way you watch television, and this is just the beginning.”

If Apple moves forward with a fuller pay TV plan, it will do battle with traditional video service providers and join an expanding mix of so-called “virtual” MVPDs. Sling TV, Dish’s OTT service targeted to cord-cutters that starts at $20 per month, launched on February 9. Sony, meanwhile, is inching toward the commercial debut of PlayStation Vue, a service that will initially be offered on PlayStation 3 and PlayStation 4 gaming consoles.

A day after its Home Box Office announced more detailed plans for its long-awaited direct-to-consumer offering dubbed HBO Now, Time Warner chairman and CEO Jeff Bewkes said partnering with Apple TV on the product will help “elevate” it in the eyes of consumers.

HBO first announced its plans for an over-the-top version of the product in October. At an Apple news event  in Cupertino, Calif., yesterday, HBO chairman Richard Plepler said the OTT product -- HBO Now – would be first available exclusively for three months to customers of Apple TV. Apple said it has sold about 25 million Apple TV devices to date, but that could grow as the company said it will reduce the price of the device from $99 to $69.

At the Deutsche Bank Media, Internet & Telecom conference in Palm Beach, Fla., Bewkes said Apple was selected for its marketing prowess and its standing among young consumers.

“They [Apple] are so good, they’re so energetic at marketing, they have such a strong position in global users, all those connected devices, the marketing and retail communication they have with hundreds of millions of people,” Bewkes said at the conference. “We thought that was a good partner to elevate HBO Now and get the value of HBO out there. ”

HBO Now is targeted initially at the 10 million broadband only homes across the country (5 million of whom have some kind of content subscription), but Bewkes said the goal is to capture customers beyond that group. As in the past, he pointed to the 70 million pay TV homes without an HBO subscription, of which he said 10 million to 15 million are primary candidates for premium channels like HBO.

 “It’s clear this is a product that can enjoy much more viewership and loyalty if it was offered well and promoted correctly,” Bewkes said.

While some distributors – particularly smaller ones – have griped that HBO Now could cannibalize their customer base, Bewkes said their reaction for the most part has been favorable for the product.

“Mostly there is excitement and the realization of our distributors that all of us together have to go further in VOD packages and marketing, including broadband only for those that want to do that,” Bewkes said. “If you’re weighting it by subs and money, most of our distributors are on board with us and they are going to push it. We have some that think that it is competitive with them and that they wish that they could have maintained the sole place to get HBO. But we’ve been telling them for quite a while, that they have to get ready so they have the capability to offer this on VOD and offer this on broadband. We think that we’ve done what we can and we will continue to that.”

He added that he believes that even those critics “will come around because it’s in their interest to take this powerful product and sell it in every way that their consumers want to get it. They simply have to be more vigorous about it.”