Key Points
- Paramount CEO David Ellison wants to shut down HBO Max and move content into Paramount Plus if the company can acquire Warner Bros Discovery.
- The move is unusual, given HBO Max’s global availability and stronger subscriber number compared to Paramount Plus.
- Prior to the Skydance merger, Paramount and WBD executives explored the possibility of a Paramount Plus-Max bundle.
An aggressive plan by Paramount Global to acquire the assets of Warner Bros Discovery (WBD) would largely keep the latter company intact at a time when it is trying to spin off its cable networks business — but that doesn’t mean Paramount intends to continue operating separate consumer-facing services.
On Tuesday, Bloomberg reported that Paramount CEO David Ellison wants to keep CNN, Cartoon Network, Discovery Channel, TNT and other WBD-owned cable networks in the family, should executives at WBD come around to his offers.
When it comes to streaming, the plan is different: Ellison wants to consolidate WBD’s streaming platform HBO Max into Paramount Plus, which offers content from rival multiplex network Showtime in addition to shows and movies from CBS, Comedy Central, MTV and other Paramount brands.
The information reported by Bloomberg was cited to a single unnamed source, and it wasn’t clear if they were aligned with Paramount, WBD or another company.
If the report is true, the decision to wind down HBO Max in favor of Paramount Plus is a bold bet on the future of the latter streaming service. By subscriber count, HBO Max is the stronger of the two services, with 125.7 million global streaming subscribers as of the second quarter (Q2) of the year. Paramount has just under 78 million global streaming subscribers, most of whom pay for Paramount Plus; a few pay for ancillary niche services like BET Plus.
Both companies have domestic and international streaming operations, but WBD’s is available in more countries and territories. Paramount’s global reach is nearly the same when Sky Showtime, its joint venture with Comcast, is factored into the equation. As a standalone service, Paramount Plus is available in far fewer countries (45) than HBO Max (90).
Financially, WBD’s streaming business also earns more money: The media company took in $2.8 billion in global streaming revenue during Q2, compared with Paramount’s $2.18 billion, according to data reviewed by The Desk.
It isn’t clear if a Paramount-WBD tie-up will ever happen: Paramount has made numerous offers to WBD over the past few weeks, all of which were rejected by WBD executives who felt the offers undervalued the company.
But a partnership between Paramount and WBD could be in the making, as both companies have expressed a prior willingness to bundle their services together. Last year, CNBC reported WBD executives were interested in a possible partnership with Paramount that would allow streamers to access HBO Max (then called Max) and Paramount Plus content through a bundle plan.
The discussions didn’t gain critical mass, as Paramount was exploring different avenues for its business. (The conversations happened after Paramount’s initial talks with Skydance Media broke down. Paramount and Skydance ultimately reconciled their difference, with Skydance acquiring Paramount in August.) WBD wound up forging a streaming partnership with Disney instead, launching a bundle that pairs the ad-supported tiers of HBO Max, Disney Plus and Hulu together for $15 per month.
