HBO is in the business of addiction. Those are words right from the horse’s mouth, not ours, and that’s why the company has said it’s OK that its users share logins with other folks. The business model, HBO says, is that eventually those new users will sign up for their own plans. Starting next year, the Web will be a new option for signing up for HBO service, the company confirmed in statements on Wednesday.
The Web plans will allow cord cutters, or folks who have ditched cable TV subscriptions entirely, to pay for HBO plans that can be streamed from the Web and, presumably, the company’s suite of mobile applications. Right now, HBO can’t really tap into that growing customer base of consumers who are tired of the cable model and prefer to rely on somewhat à-la-carte subscriptions to individual services like Hulu and Netflix.
Plepler made the comments during a Time Warner Inc. investor meeting, noting that there are now 10 million homes in the U.S. that only pay for broadband Internet services. “That is a large and growing opportunity that should no longer be left untapped,” he said. “It is time to remove all barriers to those who want HBO.” Smart move, and one that will hopefully kick off a trend among premium content providers.
“So, in 2015, we will launch a stand-alone, over-the-top, HBO service in the United States,” Plepler continued. “e will work with our current partners. And, we will explore models with new partners. All in, there are 80 million homes that do not have HBO and we will use all means at our disposal to go after them.” The executive declined to say how much the service will cost, but this is great news for cord cutters and bad news for HBO’s competitors. Shares of Netflix were down about 3 percent on the news.