NEW YORK—In the Q3, 2022 earnings call for Warner Bros. Discovery, executives moved up the launch date for the combined HBO Max/Discovery+ streaming offering to the spring of 2023 and discussed a number of opportunities for increasing revenues that included raising prices and increasing the ad load.
The company also promised to launch a FAST streaming service in 2023 in addition to its SVOD product.
In Q3, WBD reported that total direct to consumer subscribers (DTC) were 94.9 million, an increase of 2.8 million global subscribers since the end of Q2 and that DTC reported revenues were $2,317 million, down 6% from the prior quarter.
In the earnings call, David Zaslav, president and CEO said “with respect to direct-to-consumer we added nearly 3 million net global direct-to-consumer subs this quarter. And we expect a healthy inflection with the launch of our combined service and expanded global footprint. With that, we are excited to announce that we have moved up our U.S. launch date from summer of 2023 to spring.”
The company did not provide further information on the name of the new product or pricing. During the call, Jean-Briac Perrette, CEO and president, Global Streaming and Interactive at the company also noted that “I'd say pricing is one of four things that makes us particularly optimistic about the products coming together, obviously content aggregation and pulling all the content pieces together.”
“[B]y 2023, HBO Max will not have raised prices since its launch. So it will have been three years, since pricing has moved, which we think is an opportunity, particularly in this environment. And number two, when we look internationally, our wholesale and retail ARPUs are meaningfully lower than the market leaders. And for us that spells opportunity and an ability as we think about the new product coming to market and even some initiatives before the new product comes to market for growth on ARPU internationally.”
Later in the call Zaslav also noted that “today we have about two to three minutes of ads in HBO Max ad-light, that's about half of what we have on Discovery Plus. So we think we have, as we roll the two combined products, almost 100% growth in the inventory available to us as we look to combine the ad loads of those two products.”
