The 78-year-old executive offered the streaming takes in an interview with CNBC on Thursday morning, just before Liberty’s annual investor day. Liberty’s portfolio includes Sirius XM, the Formula 1 auto racing circuit and sports teams like Major League Baseball’s Atlanta Braves. Malone is also the largest individual shareholder in Discovery Communications and maintains investments in Charter Communications and other media companies.
“I don’t see the growth for HBO in going this route,” Malone said in the interview. “I really have trouble seeing HBO being able to get the scale to be able to be at the top of the chart in terms of direct consumer subscribers.”
WarnerMedia has projected reaching 75 million to 90 million global subscribers by 2025 with HBO Max, which will launch next May. Initially a subscription service, it will encompass an ad-supported tier by 2021 and also add live news and sports, though WarnerMedia and parent AT&T have not offered details about those extensions.
“The way I look at it is in the U.S., if you wanted HBO, you already have HBO. So I don’t see they gain a lot of new customers,” Malone said. “They certainly don’t have the budget to defend and protect their content supply long-term, and they don’t own the rights to international distribution and it will take them years to develop and hold onto enough content to be a real player internationally.”
Malone’s history as a prominent cable operator likely plays a role in the way he views the HBO Max offering. At an investor presentation last month, WarnerMedia said the service will cost $15 a month and will be offered free to AT&T pay-TV subscribers. Pressed by Wall Street analysts about additional distribution options, the company said negotiations were ongoing with additional partners. It remains unclear whether major pay-TV operators such as Comcast or the Malone-backed Charter will offer HBO Max to existing HBO subscribers or other customers.
Apple, meanwhile, “is going to surprise everyone with numbers they achieve in a short period of time,” Malone said. Apple TV+ was the first of four major new streaming launches, hitting the market November 1 with a slender portfolio of originals and no library but an appealing price point of $5 a month. “Even though they’re thin on content,” Malone said, “when you start with 460 consumer relationships, and you give them something for free, that’s a very interesting way to get large numbers fast.”