HBO damn near invented the concept of prestige television with Oz, its 1990s prison drama—a show so violent it appeared that each episode had a kill quota. Since then the network has delivered a succession of critically—and popularly—acclaimed series and miniseries: The Sopranos, Sex and the City, Six Feet Under, Rome, Deadwood, and today, Big Little Lies, and Game of Thrones, among others.
HBO’s original series stand out for their obviously painstaking creation. Indeed, even the ones I don’t particularly like—I literally fell asleep during the finale of Westworld’s first season, despite loving its 1970s source material—are obviously lovingly, and expensively, produced. HBO doesn’t do cheap. The network, in other words, has embraced an ethos of quality over quantity: producing only a few select series, plus the occasional movie, rather than flooding the zone with cheap content.
Creative merits aside, as a pure business play, it’s worked: HBO boasts about 30 million subscribers (though the entertainment writer Richard Rushfield points out to me that it’s unknowable how many of those are there for boxing, rather than HBO’s original programming) and is highly profitable. It logs more than $2 billion in annual revenue, a particularly remarkable feat considering that almost all of its income comes from subscription fees rather than advertising.
But HBO’s new owner, AT&T, which picked it up in the recent Time Warner merger, says the network isn’t profitable enough. And so, John Stankey, the AT&T exec who’s the new CEO of Warner Media, is now demanding more growth and higher profits. According to leaked audio, the AT&T honcho envisages a network producing “hours a day” or original content, rather than “hours a week.” The obvious analogue is Netflix, which has found business success in flooding its subscribers with a broader range of content, including projects for whom the description “mediocre” is a kindness.
Suffice it say, HBO can produce only so much MOAR CONTENT before its offerings begin to suffer. So the question is: Is this the New Coke of television, a moronic tinkering with a formula that works? Possibly. But it’s also clear that AT&T wants HBO to become something different. It wants the network to go head-to-head not only with Netflix and Amazon Prime, but also the forthcoming streaming service from Disney.
“If you’re looking at your new AT&T entertainment holdings, and you want to build a service to go head to head with Disney, HBO basically is the biggest jumping off point you’ve got,” Rushfield, who pens The Ankler, tells me. “It’s much easier to try to turn HBO GO into a entertainment semi-finals contender than to try and start one from scratch.”
The problem, of course, as Rushfield puts it, is that “snobby is the brand.” An “HBO that serves everyone is like a KFC that only serves Kale and nothing else,” he says.
Exactly. HBO isn’t KFC. It’s Momofuku. And before destroying it, AT&T should consider that.
