AT&T Is Very Excited To Try And Ruin HBO
from the ill-communication dept
Ma bell isn't much fun at parties. While traditional telcos desperately want to pivot from broadband and cable to video and online advertising, that transition has been challenging. Especially for a sector that has spent the last 30 years as government-pampered regional mono/duopolies. Many of these companies are good at running a network or lobbying government to stifle competition, but they're simply not very good at things like creativity, innovation, or disruption. That was recently made abundantly clear by Verizon's face plant after it tried to launch a sexy new Millennial-focused video platform dubbed Go90.
AT&T suffers from the same disease, and it may soon manifest in abundance.
You'll recall that AT&T's $86 billion acquisition of Time Warner was allowed to proceed after a comically narrow reading of the market by U.S. District Court Judge Richard Leon. At absolutely no point in his 172-page ruling, did Leon show the faintest awareness that AT&T wants to use the gutting of the FCC, the elimination of net neutrality rules, and vertical integration synergistically to behave anti-competitively in the broadband and streaming video space, something that's obvious to anybody that has spent thirty seconds watching AT&T do business.
Leon took AT&T lawyers' arguments completely at face value, resulting in him failing to even apply a single meaningful condition to AT&T's latest megamerger.
And while the death of net neutrality, regulatory capture and rubber-stamped merger mania are all wonderful things for AT&T, there's still one little problem AT&T needs to overcome in order to capitalize on its wide, open anti-competitive runway: it's just not very good at this whole creativity or innovation thing. While it's clear that AT&T executives think they're really good at innovation, there are growing concerns that the company is going to meddle with HBO and erode many of the things that made the channel a standout over the last twenty years.
AT&T execs initially stated they'd be leaving HBO alone to do what the company does best. But that promise quickly evaporated this week at a town hall meeting at the network’s headquarters in Midtown Manhattan, where AT&T execs like John Stankey proclaimed that AT&T intends to dramatically reshape HBO to effectively focus on quantity and ad impressions over quality:
Mr. Stankey described a future in which HBO would substantially increase its subscriber base and the number of hours that viewers spend watching its shows. To pull it off, the network will have to come up with more content, transforming itself from a boutique operation, with a focus on its signature Sunday night lineup, into something bigger and broader.
“I want more hours of engagement. Why are more hours of engagement important? Because you get more data and information about a customer that then allows you to do things like monetize through alternate models of advertising as well as subscriptions, which I think is very important to play in tomorrow’s world.”
Of course Netflix has been taking heat for focusing on quantity over quality, resulting in a string of high-profile duds. And AT&T's version of "monetization" has historically involved things like charging broadband users more money if they want to protect their own privacy. If you're an HBO exec and alarm bells aren't ringing in your ears, you likely haven't paid enough attention to AT&T's scattershot efforts to dominate media pre-merger. Stankey then tried to equate the experience HBO was about to go through under AT&T management to child birth:
“You will work very hard, and this next year will — my wife hates it when I say this — feel like childbirth,” he said. “You’ll look back on it and be very fond of it, but it’s not going to feel great while you’re in the middle of it. She says, ‘What do you know about this?’ I just observe, ‘Honey. We love our kids.’”
On the plus side, it's clear that AT&T wants to spend billions on original content to help the new AT&T-owned HBO to match Netflix blow for blow in the streaming wars. On the flip side, AT&T's corporate culture (indisputably anti-consumer, viciously anti-competitive and historically hostile) is inevitably going to clash with HBO management. HBO has creatively crafted some of the best television in the last decade. AT&T, in turn, has expertise in things like killing net neutrality and finding new, creative ways to rip off taxpayers and its own customers.
That there are going to be tensions between the two companies likely isn't debatable. And, while success is certainly possible, whether AT&T can shake off some of its own worst habits and "improve" HBO -- without eliminating all of its finest traits in the process -- is going to prove interesting to watch.
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Filed Under: competition, content, content creation, hbo
Companies: at&t, hbo, time warner
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Nice and telling priorities
“I want more hours of engagement. Why are more hours of engagement important? Because you get more data and information about a customer that then allows you to do things like monetize through alternate models of advertising as well as subscriptions, which I think is very important to play in tomorrow’s world.”
Besides being incredibly tone-deaf given the recent focus on companies gobbling as much personal data as possible, this also seems to highly a rather skewed set of priorities. Customers being engaged is seen not as a good thing on it's own, but something to be used in order to boost value via advertising.
A focus on collecting data for advertising purposes over producing good entertainment doesn't exactly bode very well for continued quality of the content in question.
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Re: Nice and telling priorities
The lack of ads in HBO content is a key to retention of the existing customer base. This will go over like a gameplay nerf in a popular online game.
The stage is set to lose the core customer, and you're not going to find an untapped replacement population to rush in.
Profit is maximized by letting HBO run the way it is. They've a proven successful model and core customer base that has stood out in the time of cable cutting. Build out streaming service with HBO as the centerpiece, and create a side-business to churn out content under guidance from experienced parties at HBO.
The Board at AT&T should start shopping for a replacement Exec. Or at minimum restrict reach on certain aspects of business. If the Board fails to act, online comment are great repositories of the clear public feedback available.
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Re: Re: Nice and telling priorities
Maybe they'll go for product placement rather than ads.
Dany's dragons are big enough; they have lots of room for sponsorship patches.
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Re: Re: Nice and telling priorities
When AT&T enters a market, it is always late or last to do so. It always pays to much to get in. It doesn't have a clue what to do with the thing that it just bought, in fact, they never saw this whole thing coming - they are just doing what all the other players have already done. They will try to fix what's not broken with the thing that they bought, with their patented Bell Labs inspired know-how. (Never mind that Bell Labs is not part of AT&T any more)
They will usually wreck the thing they bought, at best they will milk it for a while as the bought company stops investing, stops innovating and withers. The solution to all this will be Selling Bundles.
Bundles is always the solution, children.
Other companies will continue innovating, AT&T will continue on with its government-driven monopoly businesses. Of which HBO is not, so it'll ultimately get peddled to someone who knows something about running a movie studio.
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Re: Re: Nice and telling priorities
If I were them I would reason away adding ads to the service this way:
1) most other paid services still have ad breaks.
2) Where will the consumers go? Nobody else has their shows. Sure I can buy them on Amazon/itunes months later. but the hardcore fans won't.
3) They have a significant user base of non-paying subscribers. They are giving away HBO subscriptions like candy. I get it for "free" with my satellite subscription. Comcast offered it to me for free for my internet subscription. A vast majority of those will likely stay when ads get added in.
Expect ads on HBO within a yar, two at the most. Expect very little to change in their subscriber base. Most folks have no other option if they still want the content.*
*Yes there is piracy, but I have always believed that the person who would pirate in a situation like this was just looking for excuses to pirate anyways.
Do I like ads? Heck no. I hate them so much. There are too many ad breaks and the ad serving technology on streaming services frequently breaks down (I was watching an ABC show once and it took nearly two hours to get through a single episode because they added so many extra unskippable commercial breaks.
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Re: Re: Re: Nice and telling priorities
And that is a cost saving that AT&T can make?
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Re: Re: Re: Re: Nice and telling priorities
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Re: Re: Re: Re: Re: Nice and telling priorities
TINSTAAFL. They were not partnering to give away HBO with DirectTV, Comcast and others out of the goodness of their hearts. No way were those services paying Time Warner full price either. they had a long-term plan in mind and the only one that makes sense is commercials.
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Re: Nice and telling priorities
Why? If people switch off the TV, there will be no advertising.
And, I mean, get real: Shakespeare is soap opera garbage written for the masses. The best of well-aged concentrated garbage, for sure, but garbage nevertheless. The grappa of literature.
Shakespeare needed to make enough of a difference for people to take the effort getting into Globe Theatre. Today's writers need to make enough of a difference for people to switch on the TV. And pay for access, but you just need a reasonably good offer once or twice a month. Producing more quality than that is a waste of money.
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Re: Re: Nice and telling priorities
...it's HBO. Up until this point, if people left the TV on there was no advertising. (Or, more accurately, there was minimal advertising, for other programming on HBO and related stations, shown between programs.)
HBO's gotten this far without making advertising a priority. That's the appeal: customers pay a premium fee for premium programming. That's how HBO's been as successful as it has. Changing that value proposition risks changing HBO's perceived value.
I think you're confusing garbage with appeal to the lowest common denominator. They're not the same thing.
That Shakespeare's works are rife with formulaic plots, dick jokes, and repeated explanations of the plot to make sure the groundlings caught it, does not make them garbage. The reason we're still talking about the man four hundred years later is that he had a truly astounding gift for language. That he gave the public what it wanted didn't hurt, of course.
I do think Shakespeare's a great object example of just how artificial the divide between "high art" and "low art" is. But low art is not the same thing as garbage -- that's the point.
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The reason Stankey likes to compare childbirth to innovation is because he has zero experience with either.
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I'm really looking forward to the Last Week Tonight segment on this.
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You want desperately to say... what? -- ATT evil and will fail?
This is a particularly wandering and dimly predictive version of your constant attacks.
Apparently your notion is that HBO should be alarmed because ATT wants it to be substantially larger and get more viewing time? -- I doubt that'll scare 'em. They may even be happy. -- SAY. Why don't you get a statement from HBO instead of fabricate their reaction?
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Re: You want desperately to say... what? -- ATT evil and will fail?
If HBO wanted to grow larger, it would have done so already. That it remains successful despite not airing new shows and original movies every day of the week tells me that HBO prefers quality over quantity. AT&T will change that, and nothing in the company’s track record says HBO will be better off for that change.
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Re: You want desperately to say... what? -- ATT evil and will fail?
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Re: Re: You want desperately to say... what? -- ATT evil and will fail?
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Re:
Exactly what the article states. Perhaps you should spend more time reading them and less time making a fool of yourself in the comments.
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Your precious Netflix has come up with an epoch buck-bloster:
NETFLIX Airs Star-Spangled 'Salute to Abortion'...
https://www.cnsnews.com/blog/craig-bannister/netflix-airs-salute-abortion-host-declares -god-bless-abortions
WHEE! Now that's television! Maybe next they can show puppies being euthanized.
Board note: from the real ME. But accept all imitations (despite lack of substance), and particularly write lame limericks at them.
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Re:
So what?
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Re: Re:
Of course, he'll ignore the hundreds of thousands of hours of other things to watch, and ignore the fact that every network has something that can be ginned up as a "controversy". No, Netflix dared to have a single show on there that didn't cater to his sensitive sensibilities, some they're evil somehow.
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Re: Re: Re:
Or deliberately seeks out things to take offense at. Just look at how long s/he have hung around on a site that they hare.
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Re: Re: Re: Re:
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Re: Your precious Netflix has come up with an epoch buck-bloster:
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Re: Re:
Until someone offends them and then it's a case of people being mean to them because those opinions aren't censored.
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Re: Y
Who is the "real" you? In fact, who is "you"?
If you're offended by people pretending to be the same brand of idiot as you, maybe you should provide us with a way of telling you apart?
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Re: Re: Y
Cogito, ergo sum.
Therefore, "he", in fact, is not.
Must be a figment of our collective imagination.
:D
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Re: Your precious Netflix has come up with an epoch buck-bloster:
Netflix also has an original show called "The Ranch", in which the main character explicitly calls abortion "morally wrong" and convinces his girlfriend to not get one.
So now what? Can we get all excited and praise them for airing a "pro-life" show?
This is literally a nothing-burger. And I don't support abortion.
Whether Netflix airs a pro-life or pro-abortion show is absolutely irrelevant to anything and doesn't say anything about the company itself, other than they chose to carry a show that offends some people. Guess what, every show they carry offends someone.
Stop sensationalizing non-news.
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Re: Re:
Come on, I like a little comment sparring. It keeps my debate skills sharp and occasionally I learn something new.
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Re:
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I'm Out
I canceled my HBO after reading this yesterday.
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Re: I'm Out
Being able to utilize information like that is obviously worth a lot of money.
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Following their own crooked road
Or, how much of the debt incurred by the Time/Warner purchase did they dump into HBO's financials to make it appear so fiscally sick?
Either way, AT&T appears ready to destroy something good merely in order to fit it into their framework of customer disdain. But this may be a good thing. In the process of creative destruction they will make room for another, or perhaps several others to fill the gap created by the soon to be missing HBO. Just how long will the creative people at HBO hang around?
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Re: Following their own crooked road
Who said it's in poor shape?
They figured they could milk some more money from the customers.
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Re: Re: Following their own crooked road
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Re: Re: Re: Following their own crooked road
No, it doesn't. It's possible, even likely, that HBO is in fine shape and they're just greedy.
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Re: Following their own crooked road
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This is as tone-deaf as it comes.
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I disagree with this for numerous reasons. Partly because a lot of the things that tend to be criticised have either failed with critics but succeeded with audiences, represent risk taking that isn't being taken anywhere else, or is simply offering distribution for things that are a difficult sell through "traditional" means.
They might not always hit, but it's the fact that they take risks and go for things that aren't boring cookie-cutter copies of what everyone else is doing that's part of the charm. Nobody in the history of entertainment has ever had a 100% hit rate, and not everything has to appeal to everybody.
Every time I read one of these articles, one of the "duds" they give as an example inevitably ends up being something I really enjoyed. But, a show isn't for you? fine, stop watching and watch the next one it won't cost you anything more, and Netflix are watching to see what people are actually getting the most from.
As for HBO, it's pretty amazing what's being said here since the content itself is one of the things people tend to have the *least* problem with overall. It's the distribution model that usually hurts them,.
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Re:
Anecdotal experience is not evidence.
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Re: Re:
Let's take "Bright" as an example. Critics panned it. Trashed it even. Yet it was popular enough with viewers that Netflix greenlight a sequel.
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Any film can find an audience despite being…flawed. Shit, those Michael Bay-directed Transformers movies made hundreds of millions of dollars and they were all garbage.
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What does that have to do with stating my subjective opinion, and the fact that it often differs from the subjective opinions of the people writing these kinds of articles?
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Or...
Sure AT&T has a track record but so do the execs at Time Warner that have in the past shown they are in charge and find creative means to get more revenue.
I'd laugh so hard of AT&T were being played like AOL was and Time Warner management ended up on top with AT&T relegated to a few social media holdings.
It would be delicious irony if AT&T ended up with the short stick.
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hahahahaha hahahahaha hahahahaa
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Term lengths
So we have to endure Trump up to two terms. Unless he decides that the constitution means nothing.
…oh crap.
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The worrisome question is will it be affordable when it airs?
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Cut the cord all together
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Re: Cut the cord all together
Usually the fiction includes some model of morals, so it beats hours of staring at politicians.
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Re: Re: Cut the cord all together
He said stop hitting yourself in the face, not start punching yourself in the nuts!
(metaphorically speaking)
How about invite another family over for dinner instead?
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Too expensive for one, and also has a habit of failing or taking forever to load things, including at crucial hours (when new Game of Thrones episodes come out).
I tried to watch another series at HBO before my subscription expired last time. I gave up a couple of minutes into the first episode of that series because the video was nearly unwatchable from all the server issues they were having.
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If it ain't broke...
Why even try to pivot an existing brand like that - if this is such a good idea they could create a new service no problem. Call it Go99 or something.
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Netflix
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Re: Netflix
1. No Commercials
2. New shows every Friday.
Quality is cool, a bonus, but paying for a subscription and being treated as the actual customer has a lot to do with how my friends view Netflix favorably.
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Re: Re: Netflix
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Just a bot
Specifically, this is from the article itself. I had another bot quote only my first sentence.
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*grabs popcorn*
Let us watch the demise of HBO.
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Re:
Mark this day, ladies and gentlemen. It is not often that we get to see the beginning of a train wreck so clearly.
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Entourage: The Next Generation
Flight of the Concords 2: Electric Boogaloo
Sopranos: Revelations
A Summary of Fire and Ice: The Post-Show Game of Thrones Musical Review
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Re:
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Hey, if any modern story could be adapted into a Der Ring des Nibelungen-style epic 15-hour opera, I think Game of Thrones could pull it off.
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LOVE open comprtition..
Undercut prices for SAME data on YOUR OWN servers..
BUY OUT the competition? because you CANT compete..
BUY OUT the other company that already CREATED something, that YOU THINK is doing well..so you can over price the goods.
RESTRICT access to a company that IS competing with you, BECAUSE you cant compete?
SLOWLY absorb those 20 Companies that are DOING something you cant, do as well..
RESTRICT access to YOUR selection of DATA to OTHER ISP's, unless the Consumer or company PAYS you for it..
The ISP's are the People sitting around the table..
The MAIN internet is the Table in the middle, Covered with food..
EVERY ISP wants PARTS OF THE NET, and they will SELL the others ABIT of what they have TAKEN..
All those GREAT ideas created by OTHERS, they Wish to take..They didnt create it, but its Proven it works.
NOW they want it, will PAY FORTUNES FOR IT..and CHARGE everyone ELSE for it..
Whats interesting is this will restrict ALL of the internet, even international..They are Breaking up the net into countries..with LOTS of borders.
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Today I've not had a TV in over a decade. I don't miss what is put on the air waves today. That's not entertainment in my book. You'd have to pay me to pirate it.
Let AT&T live in their dream world as long as they can. I just don't care about their PPV.
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Late to the party, but
As for HBO, to the corporate executive, being profitable isn't enough. Profits must grow, just as the spice must flow. That a given division isn't capable of organically growing its profits by 12-14% per year, year in and year out, doesn't bother them. When a vein is tapped out, it will be abandoned, after first stripping it of any possible future value before dumping it. Besides, by then, they will have moved their personal mining operations to another division or company, so taking the blame won't be an issue.
What will inevitably happen with HBO, if execs like Stinky have their way, is to take it down the path well-trodden by channels such as History, Discovery, and FoodTV.
Some here will remember the great casts of SNL, and some might even have noticed its path down that road, to homogenized blandness. SCTV and Mad TV, not to mention In Living Color all overshadowed SNL in terms of getting belly-laughs, at least for a time, but all eventually fell prey to the same demon: homogenized blandness.
I get that History got to the point where the joke "all Hitler, all the time" (NB: They havern't completely forgotten their raison d'etre, though), but going to "all Pawn Stars, all the time" wasn't a notable improvement. The problem with the Stinkys of the world is that they want to take specialty organizations such as HBO and turn them into status quo operations in a crowded market, confident that what used to make it special will give them an advantage, even after they stop doing it. It'll fail, of course, but not until after the Stinkys have gotten rewarded for sending the business down the highway to Meaninglessness.
Corporations tend to value cleverness over thought, but if you can slip the question under the radar, MBAs think they are the same thing. Well, not think, but believe, and belief is the only justification that cleverness needs.
If Stinky gets his way, in five years or so, HBO will have joined the ranks of Discovery, et alia, as just another place to get shows to go viral. Duck Dynasty Mk. II, here we come!
Oddly enough, once the non-creative MBAs have pushed the creative people out of the way, substance and quality go to hell - but don't worry, I have a brand new corporate training initiative that will encourage creative people to take risks and be creative - subject to executive approval and accompanied by a bonus in the tens of thousands for ideas that generate tens of millions. Or more likely just thousands, but might as well be generous, since the process includes review of creative ideas by non-creative executives.
Writing TV episodes to drive advertising sales makes sense, to an MBA. The often-annoying predictability this imposes on shows means nothing to them. If a show can't meet the demands of ad sales while getting and staying popular is never a problem as far as MBA-imposed restrictions are concerned - not if you ask MBAs, anyway. No, the restrictions, in their view, are completely reasonable and non-problematic. After all, other shows get popular under the format, so the problem must be with the creative people, right? MBAs know for a fact that MBAs make good business decisions, so it couldn't be any of them.
Just ask them. If the MBA you ask doesn't answer with a terse dismissal, he'll give you an even bigger earful than I have, in explaining how MBAs know how everything works, and how the people who complain are completely unreasonable. After all, all their fellow MBAs agree as to what the best practices are, so following the best practices can't go wrong. Must be a problem with actors, writers, directors or producers, if a show fails. The MBAs are following the best industry practices.
That's the thing about MBAs, they value proven methods over innovation, every time. Predictable outcomes are better than taking risks with the unknown. More of the same is always better than something different, something that might fail. If a show breaks through all that, and succeeds, it will promptly be followed by imitations that try to cash in on the new model.
that isn't to say that MBAs don't have a worthwhile place in the scene. They do. The issue is that as MBAs, they approach every situation with their MBA hammers, even when what's at issue is a screw rather than a nail. Bosses tell people what to do, they don't listen to what the employees think needs doing.
Put a guy like Stinky in charge for, say, three years. Five years from now, he will have moved on to a more lucrative position, and HBO will have been transformed into a desert of blandness - which is just the kind of environment an executive will need to personally benefit, if/when a show takes off unexpectedly.
Bah. MBAs are all about conforming to established ways of doing business, even unsustainable ones such as demanding growth in profits advance by at least 12% per annum, or else; or firing the lowest 10% of your employees, year after year. Say what you will about sustainability, but that's MBA thinking: set goals and expect them to be achieved. If they are not achieved, the underperformers pay the price, not the goal-setters that often don't have a clue about what the rank-and-file employees even do.
If any MBAs happen to read this, there are primarily two options: Explain to the world how I'm wrong, because MBAs are always right, or get what I'm saying, buck the system, and move on to a new career field.
Because if nothing else, successful MBAs manage to avoid getting past the Dunning-Kruger crisis point. Gaining the expertise to pass it takes too long for career enhancement, and besides, other MBAs won't respect the effort. They'd rather announce that the hiring of a successful MBA in the field of manufacturing fidget spinners brings a "fresh perspective" to MRI unit manufacturing. Well, yeah, if you want someone who knows nothing about making the damn things to decide how they'd be more profitable if some "unimportant" corners got cut. Bullshit.
As long as I've gone on, I could go much, much longer. To those who read all the way through, I salute your commitment to masochism.
But yeah, AT&T isn't exactly "eivil", it's just that it still believes it should be a mono[poly again, and that its management is all-MBA, all the way, baby.
And if MBAs have no other skills, they are all good at diverting blame onto others, while gathering credit for themselves. It's inherent to the field; you can't advance without taking credit for the work of others while blaming failures on those doing the work. Crediting others (in a meaningful sense) and taking responsibility for failures is the death of advancement, when done honestly.
But, like so many others, MBAs tend to believe that their fancy degree from a fancy college makes them an expert on everything. A college degree is proof that you are smarter than those who don't have one, after all. If someone with a college degree reads this, they will no doubt tell me how much smarter and better-informed than I am. Can't argue, since they have a pretty certificate, and I don't - and the certificate is what matters, just listen to any college graduate argue with people who lack one.
Executives made the decision to leverage the CBS subscription model by forcing Trek fans to pay to watch their new "Trek". Maybe the series will have legs, I don't know; but as a Trek fan, I cannot condone or support CBS's blatant disrespect of the Trek fandom. No, I will not pay you extra to watch the series, the way you expected me to blindly do. Bullshit. Creation Cons were bad enough, but that? To pay for the privilege of making their subscription plan work? That's not just bad, that's Omega Glory bad.
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