HBO Now Sub Data: Game of Tones

During a week when the glare of the spotlight spared no media company as quarterly earnings were reported, Time Warner’s HBO unit came under particularly harsh scrutiny.

Overall results for the premium network were upbeat for the fourth quarter, especially the addition of 2.7 subscribers. But it was the 800,000 or so subscribers who get HBO via the HBO Now app that Wall Street analysts obsessed over.

(Admittedly, they did likewise with Disney, 21st Century Fox and Viacom.)

HBO chief Richard Plepler divulged subscriber numbers for the first time since the stand-alone service launched last summer, and they fell short of prevailing analyst predictions of 1 million to 2 million. Plepler noted that high-profile new shows from Bill Simmons, Jon Stewart and Vice News had not come to the service yet, and carriage has not been secured with Xbox or PlayStation. Those two services alone account for 20% of viewing of HBO Go, the authenticated TV Everywhere app.

One analyst asked Plepler about signs he interpreted as unwillingness by broadband providers to aggressively market HBO Now, lest it overshadow more traditional TV offerings, explained why the OTT service had “only” reached the 800,000 mark. “I wouldn’t say ‘only,’” he said. “I reject the notion that our major distributors out of hand do not want to bundle HBO Now. I don’t think that’s true. As our deals come up for renewal, I think we’ll see different kinds of packaging.”

He added, “If they want to sell HBO through skinny bundles, fantastic. If they want to sell HBO through triple-plays, fantastic. I think it’s very important to remember that over the last four years, we’ve grown by eight million subscribers in the U.S. In the 44-year history of our company, that’s 20% of our [total subscriber base]. What that tells you is, nobody is doing us any favors in terms of selling HBO.”