Warnes Bros. Discovery has revealed plans for a free streaming service that it aims to launch this year. By next summer, the company also plans to release a combined paid service that will reach 130 million people by 2025. The merger of Warner Bros. and Discovery earlier this year was one of the biggest stories in the business world and also raised questions about antitrust laws. One of the company’s first big moves is this free streaming service. The newly formed behemoth hopes to capitalise on its massive content rights, which include companies like HBO and Animal Planet.
David Zaslav, the CEO of the new company, recently stated that there would be a single paid subscription streaming service with the company’s assets (instead of separate services of HBO Max and Discovery+). Additionally, the soon-to-be-named free streaming service will be supported entirely by advertising. Despite the CEO’s optimism, the company is facing serious issues. It had over 55 billion USD in debt as of April, and somehow it is supposed to pay down that debt while battling head-to-head with other industry titans like Disney and Netflix. According to his statements to Wall Street, part of the CEO’s plan has been to take a more disciplined approach to spending. Disney and Netflix seem set to wage war with their wallets, but Warner Bros Discovery hopes to be more efficient and effective with its spending.
The Best Laid Plans
Despite the big words, there have been some signs of questionable decisions. For example, the company elected to scrap “Batgirl”, an almost entirely finished film that cost over 90 million USD to make. The movie was set to premiere on HBO Max, but instead, the company chose to never release the film, rendering useless all the work of the actors, directors, crew, and everybody who worked on the film. Instead, the company opted for a tax credit, and even if that move saved some money, it no doubt alienated talent throughout the industry. Now, any person involved with a Warner Bros Discovery movie will always question whether their work will be seen.
Beyond Batgirl, the company hopes that it can still attract top talent for its TV and films. The company’s head of streaming has predicted that the new streaming service will become profitable by 2024, with over 1 billion USD in profit by 2025. These are auspicious numbers, especially considering the industry’s recent trajectory. The industry is suffering in large part because people have begun to question the long-term viability and profitability of streaming services. Simply put, the market is tighter and tighter. Warner Bros. Discovery has seen its price per share fall by 30 per cent as of late, and its main competitors have also seen similar or greater hits.