Details Revealed on HBO Max-Discovery + Combo, Including Launching Next Summer

HBO Max and Discovery+ will merge into a single service starting next summer, Warner Bros. Discovery on its first-ever quarterly earnings call as a combined company on Thursday.

“Our main priority at the moment is to launch an integrated SVOD service,” CEO David Zaslav said during the June quarter earnings call.

The plan to combine the two services has long been in the works as a key part of the deal to combine former WarnerMedia and Discovery, which was reached in April. The executives also revealed that they are working on a plan to launch another new completely free streaming service.

The combined service will first launch in the United States in summer 2023, in Latin America later that year, and in European markets that currently have HBO Max in early 2024. It will launch on d other markets in Asia and Europe later that year, and be available in more than 70 countries by 2025. But this plan does not include major key markets, including the UK, Germany and Italy.

It will be available with "ad-light" and ad-free versions, similar to HBO Max's current plans.

While Zaslav called HBO the "crown jewels" of his business, he said he hasn't yet decided whether the combined service will carry the HBO name. He said the data showed an increasingly favorable consumer impression of HBO Max as must-watch quality content, which is a factor his team will consider when determining the service's name. p>

The service will combine the best aspects of Warner Bros. Discovery to put the company in a more competitive position, executives said. HBO Max offers great content that drives dating viewing, which helps with subscriber acquisition, while the Discovery+ reality portfolio is designed for comfortable viewing, which helps mitigate churn , the nemesis of any streaming service.

HBO Max has better features, but it has been plagued with technology issues. Discovery+'s app is popular with consumers, but its functionality is limited, said WBD CEO and President of Global Streaming and Gaming JB Perrette. The company will build on the strong technology foundation of Discovery+ to create a better customer experience.

"We think this product will be superb. It's about curation, it's about quality, it's about quality. The center talked about the quality of HBO Max," said Zaslav.

The company expects 130 million subscribers worldwide for the combined service by 2025. It announced 92 million subscribers on HBO Max and Discovery+ on Thursday, up 1.7 million from in the first trimester. Of these, around 4 million people subscribe to both. This quarter marked the first that the company restructured the way it reports subscribers; it no longer includes some free subscribers, AT&T subscribers who have not activated HBO Max, or subscribers of other minor services. He did not reveal discrete subscriber numbers for the two flagship services.

At the end of the prior quarter, WarnerMedia's HBO and HBO Max, still owned by AT&T, had a combined subscriber base of 76.8 million. Discovery, Inc.'s portfolio was $24 million; most of them were Discovery+.

Executives pointed to two announcements made earlier today as a pathway to the eventual combination of services: CNN Originals, including Anthony Bourdain content, will be heading to Discovery+ on August 19. In the fall, Magnolia Network home improvement shows will launch on HBO Max.

Keeping Zaslav's preference for tight spending and "not chasing every sub," Warner Bros. Discovery is not betting everything on streaming.

"In recent years, a strategy has emerged to suggest that the video industry better cut all windows to streaming and overpay and overinvest in content and deliver everything at the same time at a low price" , Perrette says.

That means fewer direct-stream movies and no expensive movies, which explains the decision to remove "Batgirl...