HBO Max strategy questioned by billionaire John Malone

During a CNBC interview, billionaire John Malone questioned WarnerMedia’s strategy over HBO Max. The 78-year-old media investor also singled out Apple TV+ as a potential surprise package. Here’s the key takeaway.

“The way I look at it is in the U.S., if you wanted HBO, you already have HBO. So I don’t see they gain a lot of new customers ”

John Malone interview with CNBC

You cannot argue with the man’s logic. If you want HBO you’d have it already. Although, WarnerMedia and HBO Max are looking at global numbers, so what’s the U.S. got to do with it?

From information released in 2018, HBO has 140 million worldwide subscribers across its channels and apps. This includes 5 million subscribers on HBO Now. Considering WarnerMedia wants 75 million to 90 million global subscribers on HBO Max by 2025, there’s no wild leap of faith in its strategy.

Who is John Malone?

What you need to know about Mr. Malone and the interview.

• John Malone is the chairman of Liberty Media
• Liberty’s portfolio includes; Sirius XM, Formula 1 auto racing circuit, MLB’s Atlanta Braves and more.
• The CNBC interview was given the day before Liberty Media’s annual investor day
• The billionaire has a history as a prominent cable investor

Whenever an interview lands before an investor day, something smells fishy. Considering this billionaire has ties, past and present to cable communication, the comments made in the interview land like loaded dice. The question is, how much crap is being peddled (if any)?

Will WarnerMedia listen?

When a billionaire media investor says he “doesn’t see growth” in your strategy, you should take note. It doesn’t matter if you’re a minnow or WarnerMedia — you’re never too big to fail.

Yet, in this case, WarnerMedia is too big to give two sh*ts. The media giant has set its course with HBO Max, and it’s only a matter of time before we’ll see if John Malone’s HBO Max prediction is right.

The reality is, despite fair expectations for HBO Max, it could still fail. It’s all predicated on the quality of content and the power of their marketing. Fortunately for HBO Max, they’ve got some absolute monster hits coming in 2020. These include Friends and The Office — historically, Netflix’s most-viewed shows.

Finally, lets touch upon Mr. Malone’s Apple prediction. How a company spending $6 billion on original content can have a “surprise upside” is baffling. Everyone should be expecting Apple TV+ to achieve numbers that validate their huge expenditures. Perhaps those loaded dice need tweaking.