Don't count on being able to subscribe to Time Warner's HBO as a stand-alone service anytime soon.
Speaking to analysts on an earnings call for its first-quarter results, Time Warner Chief Executive Jeff Bewkes threw cold water on the idea that it might offer HBO to consumers via broadband without having to subscribe to a larger cable or satellite TV package first.
"We don’t think it makes sense," Bewkes said, adding that the target market is "not significantly large enough to be attractive at this point."
Currently, HBO offers its programming via broadband through its HBO Go platform. However, it is only available to consumers who have a pay-TV subscription. There has been something of a grass-roots movement from consumers pushing for HBO Go to be sold on its own without being tied to larger pay-TV services.
Bewkes didn't rule out such a move in the future and noted that HBO Go is sold on a stand-alone basis in Scandinavia.
"We’re always going to keep evaluating it depending on the country," he said.
One of the risks of offering HBO Go as a stand-alone is that it would alienate HBO's pay-TV partners, who provide the channel with heavy marketing and technical support.
Although Netflix recently passed HBO in terms of subscribers, Bewkes said he is not worried about the pay-TV channel's future. He noted that "Game of Thrones" is the network's biggest hit since "The Sopranos"
"I don’t think there is any effect of other complimentary services," he said, adding that Netflix actually overlaps in HBO homes and that both services are complimentary to each other.
For the first quarter, Time Warner had profits of $720 million, a gain of 19% compared with a year earlier. Revenues were relatively flat at $6.9 billion.
Time Warner's cable networks, which includes HBO, CNN, TNT and TBS, saw revenues increase by 3% to $3.7 billion. The gains came from subscriber fee growth as ad revenues were off by 1%. Warner Bros. had a tough quarter as revenues fell 4% to $2.7 billion because of the disappointing performances of "Gangster Squad" and "Jack the Giant Slayer."
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