HBO Max Is Finally Coming to Amazon Devices -- Update
November 16 2020 - 12:23PM
Dow Jones News
By Drew FitzGerald and Joe Flint
AT&T Inc. reached a deal to offer its HBO Max streaming
service through Amazon.com Inc., removing a distribution barrier
that has checked the app's growth since its launch.
The telecom company said existing HBO apps on Amazon Fire
dongles and tablets will automatically upgrade to HBO Max starting
Tuesday. Viewers who subscribe to HBO through Amazon Prime Video
Channels, the e-commerce company's TV portal, will also get
upgrades. Terms weren't disclosed.
AT&T has staked much of its future on HBO Max, a beefed-up
version of the premium TV channel designed to compete with online
services like Netflix, Disney+ and Amazon's own original TV series.
Executives planned for the newer streaming service to eventually
supplant classic HBO.
That transition has moved slowly since HBO Max's May 27 launch.
Overall U.S. HBO subscribers hit a record 38 million at the end of
September, but about 8.6 million subscribers had activated HBO Max.
Many others were still watching the channel through an older cable
subscription or hadn't bothered to log into the new service, which
at $15 a month costs the same as legacy HBO.
The lack of compatibility with Amazon and Roku Inc. devices was
one of the factors holding back HBO Max's growth. Executives in
AT&T's WarnerMedia division are eager to draw more customers to
the new streaming video app, which gives the company more control
over customer billing relationships.
AT&T complained to lawmakers about Amazon's use of its
market power during negotiations earlier this year, according to
people familiar with the matter. AT&T Chief Executive John
Stankey mentioned the retailer by name during an October interview,
saying that tech companies' commercial discussions with content
creators sometimes created "bottlenecks" that hurt innovation.
The standoff became a topic of conversation on Capitol Hill in
July, when Amazon chief Jeff Bezos testified about it during an
appearance before the House Subcommittee on Antitrust, Commercial
and Administrative Law.
Amazon and Roku together control more than 70% of the
streaming-media player market, according to industry researcher
Parks Associates. The Amazon agreement leaves Roku as an outlier
with no agreement to carry HBO Max.
The two sides are separated by a dispute over how much
programming WarnerMedia is willing to provide to Roku for its own
channel as well as hammering out terms on sharing advertising when
HBO Max launches an ad-supported version of the service next year,
according to people familiar with the matter.
The Amazon deal will provide a morale boost for HBO Max. At a
town hall meeting last week, WarnerMedia Chief Executive Jason
Kilar was grilled about the lack of a deal with Amazon and Roku.
"It feels like we are spinning our wheels," one questioner said
regarding HBO Max, according to a person familiar with the
meeting.
Mr. Kilar said HBO Max was nearing deals with both, adding,
"it's better for Roku and Amazon" to have the service available for
its subscribers. "With any negotiation we have to make sure we
understand what is critical to their companies to find common
ground," Mr. Kilar told staffers, this person said.
Write to Drew FitzGerald at andrew.fitzgerald@wsj.com and Joe
Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
November 16, 2020 12:08 ET (17:08 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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