WarnerMedia Announces Plans to Merge HBO Max and Discovery Plus

Image Credit: iStock, stefanamer

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First came the race to launch. Then came the battle for content rights. Now, the streaming wars are entering a new phase: consolidation.

On Monday, WarnerMedia confirmed plans to merge its flagship streaming platform HBO Max with Discovery Plus (home of Food Network, HGTV, Travel Channel, and more) upon completion of their parent company’s merger. Let’s just hope HGTV stars Chip and Joanna Gaines bring their magic Fixer Upper touch to their notoriously glitchy new home.

Don’t Cross The Streams

Before the apps merge into a mega-platform, WarnerMedia will offer a bundling option akin to Disney’s Disney Plus, Hulu, and ESPN Plus strategy. But Discovery CFO Gunnar Wiedenfels, who will continue his role with the company post-merger, stressed the importance of consolidation: “We believe that the breadth and depth of this content offering is going to be a phenomenal consumer value proposition.” Combining multiple channels in a single package for a single monthly price? Sounds a lot like old cable packages.

There’s no launch date announced yet, and the $43 billion Discovery-WarnerMedia deal isn’t likely to close until late April, according to Variety. Still, the merger could help the company carve out additional territory in the direct-to-consumer frontier:

  • Discovery Plus reported 22 million worldwide subscribers at the end of 2021, across its $4.99 or $6.99-without-ads tiers, while HBO Max reported nearly 74 million worldwide subscribers at the end of last year, across its $9.99 and $14.99-without-ads tiers; Netflix most recently reported 222 million worldwide subs.
  • Wiedenfels didn’t say how much the new platform will cost, but did say it will support both ad-free and ad-supported subscription tiers.

The Walter White Whale: Speaking of Netflix, which hiked prices in the US in January, its stock fell on Monday to its lowest point since March 2020 and is down over 50% from its mid-November 52-week high of $700 per share. Apparently, a reopening economy isn’t great for a business model that relies on users reluctantly binging 18 straight episodes of Great British Bake Off.