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The much-anticipated service will be available only on Apple products at first and use the MLB Advanced Media streaming platform.
Last October, I reported that HBO would launch a standalone streaming service in 2015. Today, several sources are confirming that the new service, called HBO Now, will start streaming next month in time for the April 12 fifth-season premier of Game of Thrones. The announcement was made by HBO CEO Richard Plepler at this morning's Apple Watch event.
Why would HBO make such an announcement at an Apple event? Because the service will be available exclusively on Apple products such as the Apple TV, Macintosh computers, and iOS mobile devices for the first three months, though according to re/code, it might come to existing pay-TV partners before that.
HBO's current streaming service, HBO Go, is available only to those who already have a subscription to HBO via cable or satellite. This has caused much consternation among cord-cutters and cord-nevers, who get their TV entirely from online sources and perhaps over-the-air terrestrial broadcasts. They want to watch HBO's great content, but they don't want to pay for a bunch of unwelcome channels to get it.
Clearly, HBO sees an opportunity here—it estimates there are 80 million homes without HBO, a huge potential addition to the 30 million that pay for HBO on cable or satellite. However, the company is risking the ire of those cable and satellite providers, which are concerned that the new service might draw customers away from the premium packages that include HBO.
For example, according to a story at Ars Technica that cites a Wall Street Journal report, DirecTV's contract with HBO includes provisions to punish the channel if its online-only service gets too popular. As stated in the Ars Technica piece, "According to 'people familiar with the matter,' DirecTV's contract with HBO stipulates that if HBO 'signs up more than 450,000 subscribers nationally for the 'over-the-top' online service, or 300,000 in any given local market,' then DirecTV has the right to scale back its marketing of HBO. The source also told the WSJ that hitting those subscriber numbers would give DirecTV the right to sell HBO's streaming service through its own billing department as well." Apparently, HBO's parent company Time Warner thinks it's worth the risk, even to its own cable service.
Cost-wise, it's a wash for consumers. HBO Now will cost $15 per month, about the same as adding HBO to a cable or satellite package—and the first month is free to those who subscribe in April. That's more than Netflix at $8 to $12 per month, but less than Dish Network's new Sling TV service at a base price of $20 per month. In addition, Apple announced that it will drop the price of the Apple TV streaming box from $99 to $69.
HBO Now will be delivered by Major League Baseball's Advanced Media streaming platform. According to Ars Technica, the company shelved its own streaming platform late last year and decided to partner with MLB, a move that led CTO Otto Berkes to resign.
I have not yet seen an answer to this question: Will the new service offer all the same content as HBO and HBO Go, or will it be limited to a subset of that content? Such a limit might help appease the cable and satellite providers, but it would definitely anger consumers.
Update: Thanks to djsketchie, who cited an article on the USA Today website that answers this question. The article quotes Plepler saying that the new service will have access to all of HBO's original content "past, present, and future." Good news for consumers, but perhaps not-so-good news for cable and satellite providers.
What's your take on the news? Are you a cord-cutter or cord-never who's been waiting for HBO Now? Will you subscribe to the new service?
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