HBO Max/Discovery+ Merger

[Bruce]

Don't think so

Why?

 

[ncted]

Don't think so

I do.

 

[Juan]

I do.

You think CBS will buy out NBC

NAH
Comcast is using peacock as a freeby..they give it away to cable customers..that probably why their numbers are low

 

[NashGuy]

To continue on with this, Paramount+ just added another 6.8 subscribers in the first quarter and just upped their sub number projections from 65-75 million to now 100 million by the end of 2024.

Yeah, I can see Paramount+ easily making it on their own, but I could also see them sucking up little Peacock if the conditions are right.

OK, but you failed to mention the part of Paramount's earnings report yesterday where they said that revenues and profits were actually down a bit due to rising streaming costs. SVOD is a big hungry content maw and it takes a lot of money to feed that beast. You need not only a big existing library of content that can be perpetually served up but you need to keep cranking out fresh new content for audiences around the world.

Paramount+ Adds Strong 6.8 Million Subs In Q1, But Higher Streaming Costs Squeezes Profits At Parent

Paramount+ added 6.8 million subscribers last quarter to hit 40 million.

deadline.com

Only way to drive down those costs relative to your revenues is with major global scale. But Paramount doesn't have it. And I really doubt that they'll be able to grow their way up to that kind of scale organically given the mediocre stable of IP they own.

The smart bet remains that one of the following two things happens with Paramount+ between now and 2025:

• it merges, in part of whole, with another SVOD(s), e.g. Peacock, HBO Max, Disney+
• Paramount taps out of the global SVOD race, shuts down Paramount+ and becomes an arms dealer who licenses their content out to the surviving global SVODs

 

[ncted]

You think CBS will buy out NBC

NAH
Comcast is using peacock as a freeby..they give it away to cable customers..that probably why their numbers are low

I think CBS could end up with Peacock, not NBC.

 

[Zookster]

You think CBS will buy out NBC

NAH
Comcast is using peacock as a freeby..they give it away to cable customers..that probably why their numbers are low

^This. So much more to this than a bigger more successful streaming app buying a lackluster one, like the Roku Channel buying Quibi, or even Time Warner (HBO Max) buying Discovery. Comcast would have to sell off NBCUniversal first, which includes NBC News, CNBC, MSNBC, USA, SyFy, Dreamworks, etc.

The financial reality is the market cap of Comcast is over $180 billion, while Paramount's is only ~$20 billion. If anything Peacock (Comcast/NBC Universal) would buy out Paramount+.

 

[Bruce]

OK, but you failed to mention the part of Paramount's earnings report yesterday where they said that revenues and profits were actually down a bit due to rising streaming costs. SVOD is a big hungry content maw and it takes a lot of money to feed that beast. You need not only a big existing library of content that can be perpetually served up but you need to keep cranking out fresh new content for audiences around the world.

Only way to drive down those costs relative to your revenues is with major global scale. But Paramount doesn't have it. And I really doubt that they'll be able to grow their way up to that kind of scale organically given the mediocre stable of IP they own.

Ok, it is pretty obvious that you do not like the service, but I am just going to focus on the business side, not that I like or dislike the service.

If their guidance is true, that they hit 100 million by 2024 ( and I think they will go above that based on how many subs they have already attracted and not yet in a lot of countries, for example-the UK, South Korea, India, Italy, Germany, France and Austria are all starting up within this and next year), then their revenue will increase to cover the new content costs.

If we do a average of $5 a sub ( some will pay more, some will be less-India will properly be less), 38 million more subscribers ( to get to 100 million), that is a increase of $190 million a month, that is almost $2.3 billion dollars.

Even better math, after they get to that 100 million, that is $500 million a month or $6 billion a year and that does not include commercial revenue they get.

As as their IP goes, I agree not as deep as Disney, but still they have a few things, Sequels I can remember they have coming this year and next -Transformers, Top Gun, Star Trek, A Quiet Place, Mission: Impossible, Sonic.

Here is a list of programming on P+

List of Paramount+ original programming - Wikipedia

en.wikipedia.org

and original films ( plus they will have the Theater Films roughly 2 months after the Theater opening date)-

List of Paramount+ original films - Wikipedia

en.wikipedia.org

 

[Bruce]

^This. So much more to this than a bigger more successful streaming app buying a lackluster one, like the Roku Channel buying Quibi, or even Time Warner (HBO Max) buying Discovery. Comcast would have to sell off NBCUniversal first, which includes NBC News, CNBC, MSNBC, USA, SyFy, Dreamworks, etc.

Discovery bought Time Warner for less then half what AT’7T paid for it.

The financial reality is the market cap of Comcast is over $180 billion, while Paramount's is only ~$20 billion. If anything Peacock (Comcast/NBC Universal) would buy out Paramount+.

None of us can predict if one company will buy another, I have just put the focus on if Paramount+ can survive as a streaming service, if they get to 100 million subs, that is at least $6 billion a year, so a yes.

By the way, if Comcast did go after Paramount, there is no way they would get rid of certain Universal and Paramount assets ( films, cable channels, streaming channel) , they would just have to offload CBS or NBC since the government would never allow them to have two OTA Networks.

But I do not see it happening, it is a different time with interest rates a lot higher then when Disney bought most of Fox.

If anyone was going to do a big purchase of Paramount, has to someone with a lot of cash to help control the rates, Apple for example.

Comcast cash on hand is about $8 billion, Apple is $202 billion.

 

[NashGuy]

^This. So much more to this than a bigger more successful streaming app buying a lackluster one, like the Roku Channel buying Quibi, or even Time Warner (HBO Max) buying Discovery. Comcast would have to sell off NBCUniversal first, which includes NBC News, CNBC, MSNBC, USA, SyFy, Dreamworks, etc.

The financial reality is the market cap of Comcast is over $180 billion, while Paramount's is only ~$20 billion. If anything Peacock (Comcast/NBC Universal) would buy out Paramount+.

Agreed. But should those two somehow merge, I think the most likely scenario is that Comcast spins off their media arm NBCU (just as AT&T did with Warner) so that it could merge with Paramount to form a new "Universal Paramount". Wall Street tends to reward those kinds of moves as it "unlocks value," i.e. the value of NBCU probably isn't being fully reflected in the Comcast stock price. (Should that happen, though, I would expect some kind of long-term distribution agreement to be in place between the Comcast+Charter joint venture and whatever mega-SVOD Universal Paramount would bring to market. They're the two largest broadband providers and that's hugely consequential in terms of ramping up sub numbers.)

I suppose it's possible that Comcast holds onto NBCU and then tries to acquire Paramount in whole or part but that would be a harder sell to the anti-trust feds given that Comcast is the nation's largest broadband and cable TV operator. Do we really want them owning even *more* content? Vertical acquisitions (Comcast buying NBCU; AT&T buying Warner) tend to be more controversial than typical horizontal (buying your direct competitor) acquisitions, so long as the latter type doesn't result in one company owning too much of that market.

Interesting to ponder -- in a hypothetical Universal Paramount, which gets kept and which gets spun off, CBS or NBC?

 

[Juan]

I think CBS could end up with Peacock, not NBC.

What you dont understand is that NBC is folding their underused cable channels into peacock..

 

[Zookster]

Timely article for the current discussion:

Which Streaming Services May Give Up and Shut Down Next?

As the surge from stay-at-home pandemic streaming fades, companies are finding that audiences are more selective about where they spend their hard-earned dollars. CNN+ landed with a thud, getting shot down within a …

thestreamable.com

I agree that Showtime will eventually fade into Paramount+. And Hulu/Disney+ completely fuse.

 

[NashGuy]

Timely article for the current discussion:

Which Streaming Services May Give Up and Shut Down Next?

As the surge from stay-at-home pandemic streaming fades, companies are finding that audiences are more selective about where they spend their hard-earned dollars. CNN+ landed with a thud, getting shot down within a …

thestreamable.com

I agree that Showtime will eventually fade into Paramount+. And Hulu/Disney+ completely fuse.

My prediction is that when Disney announces the new cheaper ad-supported plan for Disney+ later this year, they'll also announce that new subscriptions to either Disney+ or Hulu will automatically include the other. They'll continue to exist as two separate apps for awhile longer, at least until Disney buys out Comcast's remaining 1/3 stake in Hulu. And existing subs will be able to keep their current subscriptions to either Hulu alone or Disney+ alone.

But the new options going forward will be "Disney+ Hulu" with limited ads for $9.99/mo or "Disney+ Hulu" ad-free for $15.99/mo. Select content on Disney+ (e.g. content aimed at very young children when viewed through a child-specific user profile) would remain completely ad-free.

They'll also continue to sell the full Disney Bundle, which also throws in ESPN+ (which always includes ads) for an extra $4/mo atop either of those two plans for a total of $13.99/mo or $19.99/mo (which are the current prices for the full Disney Bundle, except that right now Disney+ is always ad-free and would at that point include ads in the cheaper $13.99/mo Disney Bundle). Pricing for Hulu with Live TV, which automatically includes the full Disney Bundle, would remain the same.

To sweeten the deal a bit (and offset the blow that comes from the inclusion of ads in Disney+), this might be a good time for them to throw in the live feed of your local ABC stations as part of the Hulu base tier (at least for everyone signed up under the new Disney+ Hulu plans or the full Disney Bundle). Hulu obviously has contracts and capabilities in place to carry all those ABC stations as part of their Live TV add-on. And Paramount+ already does the same thing with live local CBS stations in their $10/mo premium tier. I'm not predicting this feature will get added but it would make sense, IMO. (There would be no cloud DVR service available for the live local ABC streams except for customers who had the full Live TV add-on.)

 

[MikeD-C05]

At this rate with all the mergers and buyouts of streaming companies , we will end up with just 4 or 5 apps that combine all of what we used to get with the main 4 networks. When you add all the prices up for each streaming app you will be paying what you did when you had sat/cable bundles. The more things change the more they stay the same.

 

[Bruce]

At this rate with all the mergers and buyouts of streaming companies , we will end up with just 4 or 5 apps that combine all of what we used to get with the main 4 networks. When you add all the prices up for each streaming app you will be paying what you did when you had sat/cable bundles. The more things change the more they stay the same.

Except no one is making you subscribe to all those services.

When you have a Live TV service, you get a bunch of channels you would never watch, but are still paying for in that monthly bill.

For example, every Live TV service has Food Network and the rest of the Discovery channels, but if I went streaming only I do not have to subscribe to Discovery+.

Now if HBO and Discovery merge, hopefully they will still offer them separately, Hulu does this now, you can get Hulu, Disney, ESPN all together at a discount, but can still subscribe separately to the service you want.

 

[ncted]

Timely article for the current discussion:

Which Streaming Services May Give Up and Shut Down Next?

As the surge from stay-at-home pandemic streaming fades, companies are finding that audiences are more selective about where they spend their hard-earned dollars. CNN+ landed with a thud, getting shot down within a …

thestreamable.com

I agree that Showtime will eventually fade into Paramount+. And Hulu/Disney+ completely fuse.

Tracks pretty much with what I've been thinking. I'd rate AppleTV+ with a higher probability though. Apple is all about image, and their play to grow their services is extremely successful. Apple One is seeing huge growth and there is a lot of value there.

 

[ncted]

At this rate with all the mergers and buyouts of streaming companies , we will end up with just 4 or 5 apps that combine all of what we used to get with the main 4 networks. When you add all the prices up for each streaming app you will be paying what you did when you had sat/cable bundles. The more things change the more they stay the same.

Perhaps, but given how traditional linear TV prices continue to increase faster than the streaming services, I am not certain the streaming prices will ever catch up. Even with all these services:

AppleTV+ (as part of Apple One)
Prime Video (as part of Prime)
Netflix (4-Stream UHD Plan)
Hulu Commerical-Free
HBOMax (Free with AT&T Gig Fiber)
Paramount+ & Showtime (commercial-free annual plan)
Disney+ (annual plan)
YouTube Premium
F1TV Premium (annual plan)
PBS Passport

I still pay less than I used to for the Dish AT200 and the associated equipment, I get way more content I am interested in watching, and I rarely have to experience any commercials.

 

[Bruce]

Perhaps, but given how traditional linear TV prices continue to increase faster than the streaming services, I am not certain the streaming prices will ever catch up. Even with all these services:

AppleTV+ (as part of Apple One)
Prime Video (as part of Prime)
Netflix (4-Stream UHD Plan)
Hulu Commerical-Free
HBOMax (Free with AT&T Gig Fiber)
Paramount+ & Showtime (commercial-free annual plan)
Disney+ (annual plan)
YouTube Premium
F1TV Premium (annual plan)
PBS Passport

I still pay less than I used to for the Dish AT200 and the associated equipment, I get way more content I am interested in watching, and I rarely have to experience any commercials.

Almost looks like my list

AppleTV+ (Annual Plan free with my purchase of gift cards using my credit cards points)
Prime Video (as part of Prime)
Netflix (4-Stream UHD Plan-free with my purchase of gift cards using my credit cards points)
Hulu Commercial Free-(free with my purchase of gift cards using my credit cards points)
HBOMax-bought annual plan at $149.99, well worth it.
Paramount+ commercial-free annual plan-(free with my purchase of gift cards using my credit cards points, also got it at $50)
Disney+ (3 year plan discount, up this November, will properly combine it with Hulu or Hulu Live)
AMC+ ( they had a special at $29.99 for the year, not worth the monthly charge, but at the discount it is)
Peacock (year commercial free at $50, not worth it at the monthly charge, not really worth it at $50 for the year either).

You Tube TV-(free with my purchase of gift cards using my credit cards points).
Hard to give up Live TV, like having it for certain things, Michigan Football in the Fall and Live News, if I had to pay real money for it, I probably would of dropped it.

Thinking about switching to Hulu live when my gift card balance with Google runs out in 2 months, Hulu Live with Commercial Free Hulu, Disney and ESPN+ at $75.99 is a good deal.

Also, I get gift cards for Vudu with my points, so all new movies at no charge.

 

[NashGuy]

Tracks pretty much with what I've been thinking. I'd rate AppleTV+ with a higher probability though. Apple is all about image, and their play to grow their services is extremely successful. Apple One is seeing huge growth and there is a lot of value there.

Also, Apple has more money than god, so they can essentially do whatever they want. I honestly think they'd be OK with Apple TV+ always being a cost center for them, as long as the net loss it generates isn't TOO high, because it essentially serves as a form of marketing for them. Having the Apple brand associated with the biggest stars in Hollywood and snagging wins at the Oscars and Emmys can't be anything but good for their image, which helps attract and retain folks in the Apple hardware and services ecosystem.

 

[NashGuy]

Now if HBO and Discovery merge, hopefully they will still offer them separately, Hulu does this now, you can get Hulu, Disney, ESPN all together at a discount, but can still subscribe separately to the service you want.

The new management at WBD has already confirmed that HBO Max and Discovery+ will merge into one service, although they haven't indicated exactly when that's going to happen. I'd say 4Q of this year is the earliest we might expect it, given what they said, but it might be a good while longer.

As for Disney+ and Hulu, they'll eventually merge, as I've stated before and as the Streamable article above also speculates. They put Hulu's likelihood of surviving the next 5 years at only 5%, specifically for this reason. (Meanwhile, they put Disney+'s chances at 100%.)

 

[Bruce]

The new management at WBD has already confirmed that HBO Max and Discovery+ will merge into one service, although they haven't indicated exactly when that's going to happen. I'd say 4Q of this year is the earliest we might expect it, given what they said, but it might be a good while longer.

Again, as long as they do not increase the price or at least offer them separately I am ok with that, but if they just add Discovery+ and charge a extra $5 for example I will be pissed off, but I doubt I will get rid of it because I am quite happy with HBO MAX’s programming.

As for Disney+ and Hulu, they'll eventually merge, as I've stated before and as the Streamable article above also speculates. They put Hulu's likelihood of surviving the next 5 years at only 5%, specifically for this reason. (Meanwhile, they put Disney+'s chances at 100%.)

Yep, I think they will also since the NBC shows are leaving, they will own most of the programming shown on Hulu from Fox and ABC, but I cannot see a show like Handmaid’s Tale on Disney+.