On the same day that a new rival subscription OTT service, Paramount Plus, hit the market, WarnerMedia chief Jason Kilar said that only a limited number of major streaming services will achieve global scale and ultimately survive.
Speaking at Morgan Stanley’s Technology, Media and Telecom virtual conference Thursday morning, Kilar said that there’s only a handful of major streaming services “that I think can ultimately get to scale, defined by hundreds of millions of paying subscribers around the world.”
How many is a handful?
“Less than six,” the former Hulu CEO said.
Right now, consumers certainly have more than five OTT options, with Paramount Plus joining the paid services ranks of Netflix, Amazon Prime Video, Hulu, Disney Plus, HBO Max, Peacock and Discovery Plus, just to name the biggest platforms.
Netflix recently made news by reaching positive cash flow right around the same time it surpassed 200 million subscribers globally.
Only Disney, which has around 146 million customers across Disney Plus, Hulu and ESPN Plus, seems to be remotely close in matching Netflix in scale.
For his part, Kilar thinks WarnerMedia’s HBO Max will ultimately get there. It recently reported 17.2 million domestic subscribers for its new HBO Max app=based service. But the total number of HBO customers in the U.S. stands at around 41.5 million, with 7 million being added just in the last year.
With HBO Max on the cusp of deploying internationally, Kilar said HBO is “two years ahead” of WarnerMedia’s goal of having 75 million - 90 million subscribers worldwide by 2025.
“I feel very good about our ability to be in that small group that ultimately gets to scale across the globe,” Kilar said.
During his session, Kilar also discussed WarnerMedia’s upcoming ad-supported iteration of HBO Max.
“It turns out that most people on this planet are not wealthy,” he said “If we can … do things elegantly through advertising to reduce the price of the service, I think that’s a fantastic thing for fans.”
Kilar was also asked if WarnerMedia might re-pivot on its decision to take theatrical movies day-and-date on HBO Max if the ongoing vaccine campaign drastically eases the COVID-19 pandemic in the coming months.
“Is theatrical attendance going to have a crazy resurgence because people have been cooped-up for a year? I could easily see that happening. And we will be there to serve them in that situation, and proudly so. When you look at our development pipeline, we absolutely are developing movies for theatrical exhibition,” Kilar said.
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