Head feints? Perhaps. But in separate appearances at an investor conference today, Time Warner’s Jeff Bewkes and CBS’ Les Moonves seemed more open than they’ve been to the possibility of using HBO and Showtime to directly challenge Netflix — including offering them on the Internet to people who don’t also subscribe to pay TV. “Up until now” it didn’t look like a good idea to shift HBO’s focus, Bewkes told the Goldman Sachs Communacopia confab. “Now the broadband opportunity is getting bigger,” which makes the question of a taking HBO Go direct to consumers “more viable and more interesting.”
An Internet-only HBO Go offering has worked well after some hiccups in Finland, Norway, Sweden and Denmark. “It’s a good thing for optionality in the longer term,” Bewkes said.
The Time Warner CEO added that he’s preparing to release some data about an experiment with Comcast that offers subscribers broadcast TV channels, broadband, and HBO Go for about $50 a month. “It’s showing a very good demand for HBO,” he said. There’s no technological or contractual obstacle to changing the delivery scheme. “We have the rights. We can do it if we want to now,” Bewkes added. “But we don’t want to do anything that’s not at a high level.”
Moonves offered a similar message about Showtime, which he said “was always Avis to HBO’s Hertz.” Its Internet-delivered Showtime Anywhere “was rolled out literally within the last 18 months. So it’s still brand new. Consumers are just getting used to it”
But asked if he thinks about a direct-to-consumer option, he said: “Oh yeah. Everybody in the media business is thinking about what is the most appropriate way to market your product. … Is there some time in the future when that could happen? Absolutely. I don’t know when that is.” He added, though, that “over the next three to five years, the business will change dramatically.”
A direct-to-consumer offering likely would infuriate the cable and satellite companies that HBO and Showtime need to market the channels to subscribers. But there’s a growing sense of the Internet as a viable alternative. Viacom buttressed that notion this morning with an agreement to provide 22 channels to Sony’s planned broadband pay TV service, which would compete with cable and satellite.