Game of homes
By Jonathan Webdale
09-04-2015
In October last year, HBO CEO Richard Pleper confirmed the company’s intention to launch a standalone over-the-top internet TV service in 2015. He didn’t specify a date, but as soon as April 13 was revealed as the premiere for the fifth season of Game of Thrones, it didn’t take industry observers long to put two and two together.
Game of Thrones
enters season five
The company’s existing on-demand service, HBO Go, debuted on Apple TV in June 2013, requiring users to have a DTH subscription in order to sign in and watch present and past episodes of the George RR Martin hit series, as well as other celebrated shows like The Sopranos, True Detective and Sex and the City.
Pleper said the firm would work with existing partners on the new OTT offering, which would dispense with the pay TV requirement – a historic development in HBO’s own story and that of US television.
But it still came as something of a surprise when, in March, Pleper appeared on stage alongside Apple CEO Tim Cook at an event expected to be all about the Apple Watch to announce that Apple TV would be the exclusive launch partner for HBO Now.
Few had predicted such an alliance and yet in many ways it now appears an obvious no-brainer. HBO and Apple: surely the epitome of what marketers mean when they talk about ‘brand synergy.’ Two names indelibly associated with premium entertainment and, in the latter case, the sleak, superior interfaces on which to watch it. This is potentially a very powerful alliance.
HBO currently has some 30 million subscribers. With HBO Now (US$14.99 a month) it’s going after the 80 million US homes that haven’t signed up, perhaps because they’re among the growing throng of ‘cord-cutters’ that have ditched cable or satellite, or ‘cord-nevers’ – those with no intention of ever paying for bundled TV channels.
This time last year, Apple revealed it had 800 million registered iTunes accounts worldwide, most of which were linked to payment cards. The company has sold 25 million Apple TV devices to date and reports are rife that the HBO Now deal is indicative of a long-anticipated, more substantial overhaul of a product famously described by Steve Jobs as little more than a hobby.
The tech giant has struggled for years to win the broadcast networks over to its way of thinking, all save for Disney’s ABC (Jobs’ widow Laurene Powell is the Mouse House’s biggest individual shareholder following his passing and boss Robert Iger has a seat on the Apple board).
But these companies are now themselves going OTT. CBS launched CBS All Access last fall, just days after Pleper’s announcement of his plans for HBO, while Disney/NBCUniversal/Fox remain wedded in their occasionally fraught relationship with Hulu.
Apple TV partnered on HBO Now
CBS, ABC and Fox are all expected to feature in the line-up of a 25-channel US$30 to US$40 per month online TV service Apple is being tipped to unveil in June ahead of a September debut. NBC, with whom Apple fell out long before the Comcast merger, isn’t currently anticipated on the roster.
Why the apparent change of momentum? Netflix, Amazon and Hulu have blazed the OTT trail with the former’s CEO, Reed Hastings, famously stating that the company wants to become the next-generation HBO before HBO can itself do so. Netflix has, to some extent, already achieved this, outpacing its rival with 40 million US subscribers and around 60 million internationally.
As well as brand synergy, HBO and Apple also surely share the desire to take their collaboration global. HBO has significant content partnerships in place in some countries, such as Sky in the UK and Germany, and already operates a standalone OTT service, HBO Nordic, as well as HBO Europe in 11 eastern markets, HBO Netherlands and others.
OTT is certainly the way the world is headed and if HBO parent Time Warner can find a way to make such a service work alongside its established pay TV product in the US, it can certainly find a way around whatever complexities it faces overseas.
From Apple’s point of view, myriad à la carte TV services are spilling on to the scene domestically, such as Dish Network’s Sling TV and Sony’s PlayStation Vue. The company is said to have become so keen to get its web TV service off the ground that it has offered partners access to usually heavily guarded customer data and relaxed stringent rules on how content’s displayed.
Working in its favour is the substantial part the firm already plays in many people’s lives. The iPhone, iPad and, soon, the Apple Watch could all be powerful tools with which to operate the connected home hub of the future that Apple TV is surely destined to become. An HBO/Apple partnership could be one vital step towards realising that vision – a stronger proposition perhaps than, say, Netflix and Roku