[Source – hollywoodreporter.com]
Warner Bros. Discovery’s CEO David Zaslav Projects Significant Max Subscriber Growth
David Zaslav, CEO of Warner Bros. Discovery, has projected that the streaming service Max will see a substantial increase of over 6 million subscribers in the current quarter. This follows a previous gain of 3.6 million net subscribers for the quarter ending in June. The anticipated growth is attributed to a new bundle offering in collaboration with Disney+, Hulu, and an ongoing push for international expansion.
Speaking at the Goldman Sachs media conference, Zaslav provided insights into the company’s post-merger challenges, recent agreements, and future outlook for its film and TV studio operations. He emphasized that Warner Bros. Discovery remains fundamentally a storytelling company, leveraging its extensive library of popular franchises to drive success. The company retains ownership of major properties such as Beetlejuice, Harry Potter, and DC Comics characters, including Superman and Batman, as well as Game of Thrones and the Joker.
Studio Business Revitalization
Warner bros. Discovery’s CEO David Zaslav projects the need to restore profitability to the studio division. The company has been rebuilding its creative team, which had previously suffered losses including that of Chris Nolan. Despite this, the studio’s performance has seen a decline, generating $1.8 billion compared to the $3 billion achieved in previous years. Zaslav expressed confidence in the studio’s recovery, noting the addition of notable talents such as Paul Thomas Anderson, George Clooney, and M. Night Shyamalan.
The DC team is actively working on the latest Superman film, which is currently in the editing phase under the guidance of DC co-CEO James Gunn. Zaslav believes that the studio is on the right track and is making significant progress toward achieving its financial goals.
Max’s Global Expansion
Regarding Max, Zaslav likened the service’s potential to having the best product but struggling to make it available to consumers. He stated that while Max is now accessible in various parts of Europe and Latin America, the service is still in the early stages of its global rollout. Within the next two years, Max aims to be available in most parts of the world. Zaslav expressed optimism that the service will see significant subscriber growth, projecting an increase of over 6 million subscribers by the end of the current quarter. Additionally, Direct-to-Consumer (DTC) revenue is expected to rise by $1 billion in EBITDA (earnings before interest, taxes, depreciation, and amortization) next year.
Charter Communications Deal and Financial Adjustments
Warner bros. Discovery’s CEO David Zaslav projects the announcement of a distribution agreement with Charter Communications, renewing the deal about a year early. This agreement includes free access to Max and Discovery+ for Charter’s expanding streaming package. Zaslav noted that the company maintained the price for its TNT channel and received increased compensation for its 30 channels overall. He confirmed that no channels were dropped from the agreement.
The company faced a significant $9.1 billion write-down in the second quarter due to the devaluation of linear assets and the anticipated loss of NBA content. This development has raised concerns among investors about the impact on upcoming carriage deals. Despite these challenges, Zaslav remains hopeful about securing professional basketball content for the coming years, which is contingent on ongoing negotiations and outcomes.
Warner bros. Discovery’s CEO David Zaslav projects the announcement of a distribution agreement with Charter Communications, renewing the deal about a year early. The NBA’s broadcasting rights were divided among Disney/ESPN, Comcast/NBCUniversal, and Amazon Prime Video. Warner Bros. Discovery had an opportunity to match offers for the least expensive Amazon package but was ultimately unsuccessful. The company has since filed a lawsuit in response to this decision, and the case is currently ongoing.
Overall, Zaslav’s comments underscore Warner Bros. Discovery’s strategic focus on leveraging its content library, expanding its streaming services, and navigating financial and distribution challenges to drive future growth.
