Looks like we’ll have to keep waiting to figure out how HBO CEO Richard Plepler can offer a direct-to-consumer streaming service — planned for next year — that doesn’t upset the pay TV ecosystem. NBC’s Willie Geist tried to get an answer from Plepler today in an appearance at the Paley Center. But the HBO chief continued to dance on the tightrope — saying just enough to titillate cord cutters, without antagonizing cable and satellite companies that want to continue limiting HBO to people who first subscribe to their basic packages.
Plepler reiterated that he wants to work with cable companies to target 10+ million households that subscribe to broadband but not pay TV. “Who controls the broadband pipe in the United States? Our distributors. So if you want a broadband only product, that’s the biggest low hanging fruit out there….I said ‘look there’s gold in the hills. Let’s go get it.'” HBO and Comcast already offer a package that enables Internet customers to get the premium channel if they buy the cheapest TV tier that mostly consists of broadcast channels.
But Plepler doesn’t rule out the possibility that he’ll answer cord cutters’ prayers and offer HBO online to those who don’t want any pay-TV. “If you’re saying that we have to have one hand tied behind our back and we have no other options to go out and get new customers, then that I reject,” he says. “We’re going to use all means our disposal to go out and get potential new consumers who want HBO.… People want the brand. This is not binary. This is not you are locked into one ecosystem and you can’t go to the other.”
The HBO chief also gave a diplomatic answer when asked about Netflix. He praised it as “a wonderful addition that has wonderful options to catch up on shows, and watch a couple of new shows that they’ve done a very good job” with. But his description of HBO puts it in a different league. It has a big advantage with first-run Hollywood movies, he says. They account for 78% of viewing on HBO; 40% of its subs only watch movies. “That is very very important.” In addition, he says HBO has a far bigger library of original programming, with 2,700 hours.
HBO is in the business of “building addicts.… We’re not selling eyeballs to advertisers. We’re selling a brand. And the brand stands for excellent quality differentiation.” To that end, Plepler talked up HBO’s planned branding campaign next year. “We’ve relied way too much on our partners to market us,” he says.
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