Home Box Office chief Richard Plepler said the premium network will launch a standalone over-the-top service in 2015, tapping into what he said are the 10 million broadband-only subscribers in the U.S. The network's popular HBO GO is available only to verified customers of the premium channel.
Plepler made the announcement at Time Warner’s investor day meeting in New York today. He added that of the 10 million broadband-only customers, about half subscribe to a streaming service. "That is a large and growing opportunity that should no longer be untapped,” Plepler said, adding that it “is time to remove all barriers” to receiving HBO.
Plepler estimated that the OTT HBO service would bring “Hundreds of millions of dollars” in additional revenue to the premium channel, both domestically and internationally. He estimated there are about 80 million homes that do not subscribe to HBO.
“We will use all means at our disposal to go after them,” he said.
Pricing of the service is still unclear, and could pose a significant issue to consumer uptake, not to mention longtime affiliates.
The premium network’s HBO Go online service, currently only available to authenticated HBO customers, has been wildly popular with cable, satellite and telco TV subscribers, particularly millennials. At the Investor Day meeting, Plepler also said that HBO will embark on its first marketing campaign for the service—outside of those of its distributor partners – for the first time in 20 years, specifically targeted at younger viewers.
“We have been far too reliant on our operators to market HBO,” Plepler said.
The premium channel is having one of its best years ever. Plepler said HBO and Cinemax combined has grown subscribers by about 2.5 million so far this year, and is on track to its best growth in 18 years. The HBO service alone, he added, is headed toward its best domestic subscriber growth in 30 years.