HBO web-only service to debut in April on Apple devices first

March 10, 2015 09:28 AM

(Bloomberg)—HBO said its stand-alone online service will debut next month with Apple Inc. as an exclusive partner, bypassing traditional cable packages and challenging Netflix Inc.

The web-streaming service, known as HBO Now, is $14.99 a month and will be available April 12, in time for the fifth season of the hit show “Game of Thrones,” HBO Chief Executive Officer Richard Plepler said Monday at an Apple event in San Francisco. HBO Now will be available exclusively on Apple TV, iPhones and iPads for three months.

By offering the Time Warner Inc.-owned premium channel outside the cable bundle, HBO could prompt more consumers to cut the cord and threaten the TV ecosystem. The move pits HBO directly against online streaming service Netflix, which has more than 57 million subscribers worldwide.

“This is a transformative moment for HBO,” Plepler said at the event. “All you need to get HBO Now is a broadband connection and an Apple device.”

Shares of Time Warner rose 1.3 percent to $85.20 at the close. Netflix, based in Los Gatos, Calif., fell as much 3.2% after the announcement, and closed at $445.63, down 1.9%.

HBO—home to such shows as “Girls” and “True Detective”—has been in talks with at least five companies including Google Inc. to distribute the Web-only service, according to people familiar with the matter. HBO has said it wants to work with its longtime cable distributors as well as new ones.

10 million consumers

TiVo Inc. CEO Tom Rogers said in an interview last week that his company, which makes digital video recorders, is in discussions with HBO about distributing the service.

Plepler has said the new service is aimed at reaching an estimated 10 million consumers who get Internet service but don’t subscribe to cable or satellite TV. In October, Time Warner announced it would offer the streaming-video service this year, separate from the cable-TV bundle.

HBO is one of several television networks chasing younger viewers with an online-only video service. CBS sells All-Access for $5.99 a month and offers a free online news service called CBSN, while Comcast Corp.’s NBC Universal has said it plans to offer a subscription service for comedy videos in the coming months.

CBS Corp.’s Showtime, a premium cable rival to HBO, has also said it plans to offer an over-the-top service this year.

“The demand for our service has never been stronger,” Showtime spokeswoman Johanna Fuentes wrote in an email. “We are currently in discussions with both traditional and Internet distributors and are following our own strategic plan. We will have additional news soon.”




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