Change in Management: How the Discovery+ and HBO Max merger could affect your subscription
The $43 billion dollar merger of Discovery Inc and AT&T’s WarnerMedia is completed
In recent times, streaming platforms have been at a raging war as the battle for most subscribers continues. Some of the frontrunners like Netflix, Prime Video, Disney+, etc, continue to be the frontrunners of this race, but a new player is about to disrupt the peace. The $43 billion dollar merger of Discovery Inc and AT&T’s WarnerMedia is completed, and the content shift is happening as we speak as the sole motive is closing the gap between this joint platform and the rest of the streaming services.
Back in 2021, the conglomerate AT&T announced that it would spin off WarnerMedia and merge it with Discovery - a company that includes networks like Discovery Channel, HGTV, Food Network, and streaming service Discovery+. Fast forward to April 2022, the merger became official and AT&T Chief Executive Officer John Stankey said in a statement, "With the close of this transaction, we expect to invest at record levels in our growth areas of 5G and fiber, where we have strong momentum." CEO and President of Warner Bros Discovery David Zaslav's top priority with this merger is to make similar profits from streaming videos like the old TV business. What does this merger mean and how could it affect the subscribers?
Why is the merger happening?
As per USA Today, CEO David Zaslav recalled an earnings call with investors which discussed the plans of combining Warner Bros, Discovery, HBO Max, and Discovery+ into one. He said, "Our main priority is launching an integrated (streaming) service." Combining separate entities with their own IPs could streamline the divided traffic under one brand, resulting in a massive surge of subscribers.
This is somewhat similar to the massive deal that Marvel Studios struck with the behemoth Disney+ which included every Marvel series and movie landing on the streamer. Following this, WarnerBros announced that every movie produced under the umbrella will land on HBO Max. This major shift happened after the world was Covid-ridden and theatres were basically dysfunctional.
How could it affect your subscriptions?
As of April 2022, when the merger was officially complete, Discovery+ was available for $4.99 a month with ads and $6.99 without. On the other hand, HBO Max was sitting at a cool $9.99 with and $14.99 for the ad-free version. In comparison, Netflix's 4K HDR subscription package was priced at $19.99 in the US. Now with the merger coming into full effect in 2023, how much the price shift? CNBC Media and Technology reporter, Alex Sherman had just the answer for it.
Sherman told IGN, "My general answer on pricing and streaming services is always yes. Every streaming service price is going to go up. Just like your cable bill went up. They're all going to go up. And of course, they're going to go up because they're going to spend more money on content to compete with each other." He continued, "I would imagine there would be an incremental price increase here by throwing all the Discovery+ stuff in it. Because you can at least give customers a reason to increase the price based on throwing all that stuff in." In conclusion, the prices for the subscription are surely expected to rise but the official amount is yet to be disclosed.