One year after Warner Media merged with Discovery Inc. to create media conglomerate Warner Bros. Discovery, the company seems past its reconstruction days and ready to grow again. Executives including CEO David Zaslav and HBO head Casey Bloys presented a new streaming strategy today (April 12) that intends to take the company into the future.
When Zaslav, the former Discovery CEO, took the reins at Warner, he stepped into a company on the brink of disaster, the New York Times reported. “It’s messier than we thought. It’s much worse than we thought,” he said in November. Mismanagement by Warner’s former owner AT&T left the company with huge losses, according to the Times. HBO, a Warner property, went from profiting $2.5 billion in 2019, one year after the AT&T acquisition, to losing $3 billion in 2021, according to Zaslav.
The chief executive made a lot of enemies after he assumed the position. A plan to slash $3 billion in costs resulted in layoffs and the cancelation of movies and television shows last year. Within weeks of the acquisition, Zaslav and other executives shut down the recently launched CNN+ streaming service. He also received criticism for shuttering the already filmed Batgirl, which a group of Democratic lawmakers cited earlier this month when they called on the Department of Justice to investigate the company. In August, animation fans attacked the company on Twitter after HBO Max removed a series of cartoons from its platform to cut costs.
Zaslav reversed most of the strategic decisions AT&T had made, including AT&T’s push to release films on streaming platforms and in theaters simultaneously, and its attempt to match Netflix’s and Amazon’s spending on productions. He restored theatrical releases and curbed rampant spending. “2022 was a year of restructuring. 2023 will be a year of building,” Zaslav said on an earnings call in February.
In today’s call detailing a new streaming strategy, Zaslav and other executives presented a plan on how Warner Bros. will leverage its franchise intellectual property, which Zaslav said is its “superpower,” to create the only streaming platform a consumer needs. The platform, called Max, will replace HBO Max on May 23 and contain both HBO Max and Discovery content.
“Together, they pack a really powerful one-two punch,” Zaslav said on the call.
HBO Max is no more
The streaming industry has a deluge of platforms, and consumers can’t pay for all of them. Warner Bros. wants Max to be “the one to watch,” the service’s new tagline, and it is leaning into the industry’s bloat to market its new service. Because it caters to most genres and age ranges, Max can provide entertainment to the whole family, Zaslav said.
Max will have the most Academy Award and Emmy winning films compared to any other streaming service, JB Perrette, the company’s president of global streaming and games, said on the call. It will have “one of the lightest ad loads in streaming,” he said, with more information on its advertising plan coming next month. The HBO Max app will automatically update to Max for most users, with login information, billing details and content recommendations carrying over. Because Discovery+, Discovery’s streaming platform, is profitable, the company will continue providing the service to existing subscribers. Max will retain the same prices as HBO Max—$9.99 for an ad-supported plan and $15.99 for an ad-free plan—despite providing more content.
In the earnings call earlier this year, Zaslav said the company intends to take “full advantage” of the franchises it owns. In today’s call, Warner Bros. announced new series that will deliver on that vision. It will produce a seven-season Harry Potter series for Max that will dive further into the books, as well as another series based on Game of Thrones.