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HBO To Offer Standalone Streaming Service Starting in 2015

Wednesday, October 22nd, 2014

After years of delay, HBO is set to launch its own online-only streaming service. Time Warner, the parent company of Home Box Office Inc., announced in mid-October that HBO will start offering a standalone, over-the-top streaming service sometime in 2015. The current streaming option available from HBO (HBO Go) is only available to those who have subscribed to the network through cable or satellite but the new service won’t have such restrictions. HBO’s move is set to increase competition for streaming service providers like Netflix, Amazon and Hulu.

While announcing the service, HBO’s CEO Richard Plepler revealed that the decision to launch a standalone streaming service is intended to capitalize on the explosive growth of online video. Speaking at Time Warner’s investor conference, Plepler said that the move is targeted towards 10 million American broadband subscribers who have not yet subscribed to a streaming service. By removing all barriers that currently prevent people from accessing HBO Go on the web, the company also hopes to bring 80 million households who are not yet part of the HBO network within its fold.

HBO’s decision to go online is yet another proof that content providers are slowly but surely moving towards online content distribution. Most content providers typically offer a bundle of channels through cable or satellite but this business model doesn’t take care of the needs of the growing number of broadband subscribers who have never subscribed to a cable service. In fact, cord cutters have been asking HBO to launch a standalone streaming service for years but the company clearly didn’t want to sour its relationship with the cable and satellite service providers. And while the network did license its content to Amazon earlier this year, it clearly wasn’t enough since the rights for major shows like “Game of Thrones” were not included in the deal.

HBO’s move is also seen as an attempt to curb online piracy. The network’s “Game of Thrones” happens to be one of the most pirated shows in the world and a lot of HBO GO users are known to share their accounts with their families and friends. However, experts argue that most people borrow login credentials because there is often no other way of accessing the service online. By uncoupling its streaming service from cable and satellite based subscription model, HBO hopes that more and more people will start paying for the content and access its shows in a legitimate way.

Most cable operators are unlikely to be affected by HBO’s decision to shun the cable since a majority of them also happen to sell broadband services. Having a fast internet connection is essential to access a web based streaming service so even if some existing customers decide to cut the cord, they would still need to subscribe to a broadband service. There is also a possibility that people would continue with their cable subscriptions even after subscribing to HBO’s service since a majority of Netflix customers also happen to have pay-TV subscriptions. And since the new service is bound to be affordable, it is also likely that people would subscribe to both Netflix and HBO in addition to keeping their existing cable connections.

October 22, 2014

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