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AT&T’s HBO Max Dilemma: Why Complicated Distribution Dynamics Mean a Bad Deal for Some Current Customers

Kevin Reilly, Chief Content Officer, HBO Max and President, TNT, TBS, & truTV during WarnerMedia Day
(Image credit: Presley Ann/Getty Images for WarnerMedia)

At first glance, AT&T and Comcast would seem to be in the same tricky position in terms of launching a Flix: they are both distributors and programmers, and they need to keep their MVPD customers happy and reassure them that the new online venture is not meant to dis-intermediate them.

(Image credit: Alan Wolk)

That’s not been a real problem for Comcast, since their Flix, Peacock is brand new. There are no existing Peacock viewers to worry about, and pretty much every pay TV subscription includes NBC. Thus, Peacock is not being positioned as an alternative to NBC, but rather a complement to it. Watch NBC on your regular cable service and Peacock on your streaming device. The two can live in harmony, and nobody walks away with hurt feelings, especially consumers who are likely to appreciate the reasonable pricing ($5 for ad-supported, $10 for ad-free).

AT&T and HBO Max are another story.

HBO, of course, already exists (and has existed for several decades), and more than 35 million people currently subscribe to HBO via their pay TV provider. Then there’s HBO Now, which has around 8 million subscribers. Many of them subscribe via Amazon or Roku. It was easier to set it up that way, given that they’d downloaded the app from those services and didn’t need to re-enter their credit card number and address and all other sorts of information.

Also read: HBO Max Launches Without App Support for Roku and Amazon Fire TV

All of this is great in terms of brand awareness and all that … only AT&T seems to have gotten itself into more than a bit of a tangle. For as made very evident by articles like this one--HBO Max is free for millions of subscribers. Are you one of them?--is that not every HBO Now subscriber will automatically be switched over to HBO Max, a troublesome scenario that is likely to create a poor first impression.

If you’re a consumer, and you’re already paying $15/month for HBO, the fact that you will not be immediately upgraded to Max, which gives you access to much, much, much more programming for the same $15/month seems capricious at best, and is likely to call to mind the not-too-distant days when pay TV companies routinely thought it was okay to treat their customers like crap.

The reality is that AT&T has yet to strike a deal with many of the major MVPDs and streaming services in order to port their current HBO customers over to Max. As of the time I’m writing this, the list of no-gos includes Roku and Amazon. 

So a major slice of the TV universe.

The solution, if you can call it that, for any of their subscribers who want access to HBO Max, would involve said subscribers cancelling their existing HBO subscriptions, downloading the Max app if they can find it (it is not currently available as a standalone app on Roku or Amazon Fire TV) and then create a new account to sign up with. 

This is something very few people are going to want to take the time and effort to do.

It may actually work in AT&T’s favor that the pandemic halted production, meaning there is little outside of reruns on Max right now that anyone would desperately want to watch. 

Meaning that existing HBO subscribers may not feel as put out by all this as they would if there was a hot new series on Max that they could not get access to.

But that’s about it for silver linings.

Mostly people are going to feel that something about Max and its many Hellerian restrictions feels like the old TV Industrial Complex they knew and loathed. The one where nothing ever made sense and all the rules and regulations felt petty and punitive. The one that Netflix and then Amazon and Hulu were able to rescue them from.

And when there are seven other Flixes out there consumers can subscribe to, that’s not a good look.

A smart move for AT&T would have been to cut the price on HBO Now for current Roku and Amazon subscribers as a way of making up for their inability to upgrade to Max. 

The truth is even an email or a tweet would have helped--a little something-something that acknowledged the absurdity of the situation and promised to get it resolved as quickly as possible.

Instead, millions of potential subscribers are looking at the aforementioned CNET article and similar and thinking that there are seven other services out there that seem ready to treat them like valued customers and appear to actually want their business. 

Worse still (for AT&T), there are likely many other subscribers who are noticing they’re still paying $15/month for a service that hasn’t had any new programming for a while and thinking maybe it’s time to put HBO on pause until they can figure out the Max thing.

To close on a brighter note, HBO is still a sterling brand and people who like HBO tend to be loyal fans of the service. If AT&T can quickly iron out all this corporate non-cooperation and assure subscribers that it was all just a temporary glitch, they may be able to walk away with just a few minor scratches.

But if they let it drag on and people realize that their friends are getting more than twice the amount of HBO content for the same $15/month, this story will not have a happy ending. 

(Not that HBO traditionally goes for happy endings, but this is one time they might.)