Netflix, Inc. (NASDAQ:NFLX) may be seen as a huge threat to traditional television, particularly channels like HBO, and the main reason why HBO has launched HBO Now, but HBO Chief Executive Officer Richard Plepler is unyielding in insisting that his company’s rival is not the reason behind HBO Now at all.
In an interview with CNN Money, which like HBO is part of Time Warner Inc (NYSE:TWX), Plepler was bluntly asked whether HBO Now is essentially a reaction to Netflix, Inc. (NASDAQ:NFLX).
“[…] this is an acknowledgement that we want to have maximum optionality in our brand. This is not a decision about Netflix. This was a decision about growing HBO and expanding HBO,” Plepler told CNN Money.
HBO has launched HBO Now with Apple Inc. (NASDAQ:AAPL), its initial exclusive partner, with the goal of attracting people who are not ever going to have a subscription to cable packages or are thinking of cutting the cord. HBO Now is like HBO Go, another subscription service HBO has been running for years, but that service needed users to have cable subscription.
Asked whether HBO is becoming more like Netflix, Inc. (NASDAQ:NFLX) whether its digital competitor is becoming more like HBO, Plepler was adamant that his company’s decisions are not really about anyone else, or Netflix, Inc. (NASDAQ:NFLX) in particular.
“I think the vast preponderance of our business is with our cable partners, with our satellite partners, with our telco partners and we are adding to that now a component which is our new digital partnership with Apple. But that’s not becoming more like anybody, that’s evolving HBO. That’s making HBO more dexterous to be more available in more ways to our consumer. We respond to our own judgments about how we want to grow our business and expand our brand,” Plepler says.
Plepler also says that if we look back on this week five years from now, we will not say that this week was the beginning of the unravelling of the cable bundle. He insists that the cable bundle will be evolving but not going away.
The HBO CEO also says earlier in the interview that HBO is now giving up on “cord cutters” and “cord nevers” because the reason why they are launching services like HBO Now is to get these people subscribed even if they will never have cable subscription or are on the process of eliminating one.
Carl Icahn’s Icahn Capital LP owned about 1.41 million Netflix, Inc. (NASDAQ:NFLX) shares by the end of the last quarter of 2014.
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