HBO didn’t announce a price point for the service, but it’s unlikely to be directly competitive with Netflix, Hulu Plus or Amazon Prime, which all cost around $8 a month, analysts who spoke with Digiday agreed. HBO costs between $15 to $20 as part of cable packages. That’s likely to remain consistent whether or not HBO partners with MVPDs, they said.
“I don’t see standalone pricing being any less than what it costs now. If it was [cheaper], pay TV subscribers would have an incentive to cancel,” cannibalizing an existing revenue stream and frustrating key distribution partners, said IHS television analyst Erik Brannon. “But at the same time, I don’t see them being able to get a premium compared to pay TV pricing either.”
This will be interesting to watch, as HBO have the problem of a brick’n mortar cash cow they they can’t kill. Does this mean the higher price points will work? Or will consumers balk at a price point that will be $200%-300% more? It is substantial… Continue reading »