Warner Bros. Discovery Embraces The Familiar To The 'Max'

Post by: Rick Ellis 12 April, 2023

I spent a few years as a financial reporter and one thing I quickly learned is to discern between an actual new product launch and the launch of a struggling product with a new name. A company's core product would need a refresh due to some combination of customer unhappiness, revenue challenges, and investor unhappiness. And the next thing you know, "Zoom Cola" is now called "Zoomie" and with the change comes a new branding color, some shiny new ads, and a promise that this new idea bears no resemblance to that struggling thing you were so happy to promote a year ago. This, they'd argue, is a new customer-focused product that combines the best of the old product with all this new stuff that kinda looks as if it was originally developed by Team Zoom Cola.

So I found today's official unveiling of the new-ish streaming service "Max" by Warner Bros. Discovery head David Zaslav and other company executives to be very familiar. 

The new service launches on May 23rd in the U.S. and plans for the new service include a lot of new content, albeit some things that had previously been announced. But the over-arching story of they presented was of a march through the land of familiar IP. New shows from the Game Of Thrones and Harry Potter world. A new series based on something related to The Big Bang Theory (although that is just "in development"). A new installment of the True Detective franchise. A new series based on Gremlins. A new series from Magnolia's Chip and Johanna Gaines. A few documentaries that were originally destined for Discovery+ and CNN. A couple of series that (although it wasn't mentioned in the presentation) will premiere simultaneously on linear channels such as HGTV and Discovery.

There were a lot of new titles announced and I do not doubt that some of them will be quite good. But what really happened here?

It's important to remember that "Max" was originally supposed to be a combination of WBD's two core streaming services, HBO Max and Discovery+. In fact, in the months leading up to the merger between Warner Media and Discovery, soon-to-be CEO David Zaslav cited the idea in interviews as one of the best rationales for the merger. Together the two services would create a "world-class customer experience." Sure, many people inside both companies were skeptical of the idea. But as anyone who has ever pitched an idea to David Zaslav will tell you, like most CEOs he has a stubborn streak that can blind him from the obvious.

So the merger closed and the company announced the combined service would launch in the Spring/early Summer of 2023. But there were problems. Some of them are technical, and some of them content-driven. And some of the issues came down to a core misunderstanding of the people who subscribe to both services.

As it turns, out, many of the current Discovery+ subscribers are quite content with that streaming service. It has a lower price point than HBO Max and for many of them, having just unscripted and reality TV available to stream was just fine with them. Internal studies commissioned after the merger apparently showed an extreme reluctance of these core subscribers to "trade up" to a more expensive combined service.

And then there were just the technical challenges that had to be overcome. The tech stacks for both services had severe limitations and in a perfect world, a combined service would have launched no sooner than next year. Launching it in mid-2023 was deemed to be nearly impossible if the goal was a massive combined service. To say nothing of the fact that Zaslav had promised a gradual global roll-out over the next year. And in many markets - especially Europe - Discovery+ currently includes a collection of live linear channels. Navigating all of that into one combined platform was going to be challenging.

So why didn't Warner Bros. Discovery simply stay with the status quo and push back the Max launch a few months? Because Zaslav and other Warner Bros Discovery executives have continued to promise a mid-2023 launch for a "new" streaming service. And failing to hit that self-imposed benchmark would likely have a negative impact on the company's stock. That's bad news if you want to keep investors happy. Or even more importantly, rake in millions of dollars in bonuses that are benchmarked to the stock price.

Based on the limited look at what the new Max looks like, I can say the service appears to be a big improvement on HBO Max. But without having the chance to test some of the issues that plague the current service (like search), I'll have to see once I get the opportunity to dive in completely.

But what struck me about today's presentation was that this is all really just the "New Coke-ization" of HBO Max. A new branding color, an updated app. And a bunch of new projects, all of which would probably have ended up on HBO Max anyway. 

It's all an effort at misdirection. To highlight the new and hope that no one notices that behind the curtain, it's all just HBO Max under another name.

With a bunch of stuff added from Discovery+.

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Last modified on Wednesday, 12 April 2023 14:09