There’s a rumor flying all over the internet today. Unlike whatever the heck is going on with Facebook, it’s coming through loud and clear. Supposedly AT&T is considering the name “HBOMax” for its new streaming service to be revealed this fall. The name brings with it a lot of different bits that all need to be unpacked. For now this is an unconfirmed rumor and plans always do change. But let’s see what an imaginary “HBOMax” would do.
First of all it ties in with other statements.
We’ve heard that the new AT&T streamer will be a premium location for a lot of other content as well as new and original stuff. By branding it as HBO+Cinemax+more, which is basically what the HBOMax name does, that rumor does seem to be confirmed.
We’ve also heard suggestions that this new package will cost more than the current HBO NOW $15/month. Again, this name plays into that. Obviously this pricing strategy is very different from what Disney is doing. They’re rolling out what is expected to be a very robust service at $6.99/month or $69.99/year. It may be smart for AT&T to concentrate on quality rather than quantity, something HBO is known for.
It also explains the MAXGO situation
Not long ago I mentioned how there is no MAXGO app for most streaming devices. You can add Cinemax onto Prime as well as get it through other services, but that’s an extra cost for satellite subscribers who should be able to authenticate to MAXGO the way they authenticate to HBO GO.
If the goal is to roll Cinemax’s content into HBO MAX, so you can have all that content for maybe $17 or $18 a month, that does make sense for streamers. It’s hard to imagine a standalone HBO or MAX app actually making financial sense when you get both for one price. Knowing that you get all of HBO, all of Cinemax, and even more original content might help with price anxiety, too.
But it doesn’t explain…
One thing that’s still up in the air is how existing cable and satellite subscribers will be able to leverage their subscriptions and get HBOMax. Will there be a price for people who do subscribe to the live TV service? For example, perhaps you’ll be able to pay just $3 a month for HBOMax if you already subscribe to HBO and Cinemax live.
Or, another way of dealing with the same issue would be to drop the price of the live service to only $3 a month but give no access to the streaming package for subscribers. This might be a way for AT&T to cut the value of its packages for cable and satellite, effectively moving the profit center straight to AT&T.
There could also be a hybrid approach where you start to see less and less going on with the live channels and the streaming service becomes the place for new original content. This would cut the value of live HBO and Cinemax and I’m guessing those subscriber numbers would drop. It could get messy.
It’s either about to get interesting or…
it could be the long-awaited and long-feared streampocalypse. There’s a theory that cord-cutting will suffer once people are paying the same amount for streaming as they were paying for cable, they’ll stop paying. Cord-cutting was born when the average cable bill went over $100/month and it could be very soon that the average streaming bill gets there. Take a look:
- Netflix: $16
- Hulu: $10
- CBS All Access: $10
- HBO NOW: $15
- Prime: (yearly cost / 12) $9
- Disney+: $7
That’s $67/month before you even add a live TV subscription service like DIRECTV NOW or Hulu. Realistically we’re already over that $100 price point but people don’t realize it yet.
It could be that people might not care for a little while longer. With auto bill pay, people are less conscious of the total costs and you really are talking about a lot of on-demand entertainment here. The real wild card here is the economy. If things turn down then you’ll see people cutting services in months they don’t want to use them. For example, they could take Netflix in July, Hulu in August, HBO in September, et cetera. This would allow them to binge their favorite programs and save a lot of cash. It’s pretty friendly for the customer but obviously the content providers don’t want that.
I guess we’ll all just have to wait and see. One thing for sure, the days of paying $12 a month and getting all the entertainment you want are long gone. Whatever this new service is going to be called, whatever it costs, it will be great — no question. But will it be great enough? We’ll see.
