HBO Won’t Need to Stretch for General Entertainment

Key Takeaways

• HBO will focus on "prestige TV" under Netflix’s ownership, abandoning efforts to become a general entertainment brand.
• Netflix co-CEOs believe HBO’s brand is well-suited for high-end, critically acclaimed content, such as True Detective and Game of Thrones spinoffs.
• The streaming giant will handle broader, more mainstream content, including DC Studios titles and series based on popular IP.
• The deal, if successful, will allow HBO to double down on its strengths and produce more content that resonates with its loyal audience.
• Netflix will continue to operate HBO Max, although the exact details of how it will function have not been disclosed.

Introduction to the Shift in Strategy
HBO has been making a push into the blockbuster business with series such as Dune: Prophecy and It: Welcome To Derry, as well as upcoming titles including Lanterns and Harry Potter. However, with Netflix’s potential acquisition of the brand, it seems that HBO will be shifting its focus towards "prestige TV". This change in strategy is driven by Netflix’s co-CEOs, who believe that HBO’s strengths lie in producing high-end, critically acclaimed content, rather than trying to compete with more general entertainment brands.

The Vision for HBO’s Future
Speaking at the UBS Global Media and Communications Conference, co-CEO Ted Sarandos outlined the vision for HBO’s future under Netflix’s ownership. He stated that HBO is a "prestige television brand that people really love" and that it has been doing "gymnastics to make themselves into a general entertainment brand". Sarandos believes that this is no longer necessary, as Netflix is already a well-established general entertainment brand. Instead, he wants HBO to "double down on the things that people have loved for 50 years about HBO". This suggests that HBO will focus on producing more content like True Detective, The White Lotus, and Game of Thrones spinoffs, which have been critically acclaimed and have resonated with audiences.

The Benefits of the Partnership
Co-CEO Greg Peters also spoke at the event, echoing Sarandos’ sentiments. He described HBO as an "incredible brand with an incredible history" that "speaks prestige TV". Peters believes that the partnership between Netflix and HBO will allow the brand to focus on its strengths, producing high-end content that resonates with its loyal audience. He stated that "we want to double down on that concept", suggesting that HBO will continue to produce content that is consistent with its brand identity. The partnership will also allow Netflix to handle broader, more mainstream content, including DC Studios titles and series based on popular IP.

The Future of HBO Max
The deal between Netflix and Warner Bros. Discovery is still pending, with a rival bid from Paramount threatening to disrupt the acquisition. However, if the deal is successful, it is likely that HBO Max will remain in operation. Netflix has stated that the streaming service will continue to exist, although the exact details of how it will function have not been disclosed. It is possible that HBO Max will continue to operate as a separate entity, with its own content and branding, while also being integrated into Netflix’s broader ecosystem. This would allow Netflix to leverage HBO’s brand and content, while also maintaining its own identity and offerings.

Conclusion and Implications
The potential acquisition of HBO by Netflix has significant implications for the streaming industry. If successful, the deal will allow HBO to focus on its strengths and produce more content that resonates with its loyal audience. Netflix, on the other hand, will be able to handle broader, more mainstream content, including DC Studios titles and series based on popular IP. The partnership will also allow both brands to leverage each other’s strengths, creating a more comprehensive and diverse range of content for audiences. As the streaming landscape continues to evolve, it will be interesting to see how this deal plays out and what it means for the future of the industry.