HBO pulled the trigger on HBO Now, its new standalone OTT offering, for a fairly straightforward reason.
“It was done to grow,” Michael Lombardo, HBO’s president of programming, said during an interview with Mark Robichaux, editorial director of Broadcasting & Cable and Multichannel News.
Lombardo said the stand-alone offering, currently offered by Apple and Cablevision Systems and coming soon to Google’s Android and Android TV platforms, was designed to resonate with cord-cutters, cord-nevers and other younger consumers who are steering clear of big bundles as they get out of college and land their first jobs.
For them, “the idea of paying $125 per month for a cable package in addition to starting life [as an adult], is daunting,” he said. While time will soon tell if HBO’s strategy will succeed, the programmer was willing to take a shot.
“It just felt that it’s better to be in front of the pack than the last guy there,” Lombardo said.
And the pay TV models are shifting as more and more content options become available to consumers. “You can no longer rely on someone channel-surfing to find you,” Lombardo said.
“You can no longer rely on Comcast marketing you. You have to have a relationship with the viewer that means something.”
Lombardo also talked about HBO’s decision to offer HBO Now through distribution partners rather than do a direct-to-consumer play.
“We are determined to figure out a way to be ubiquitous in terms of who’s distributing us,” he said. “When we made a decision to go over-the-top, we made a decision not to handle credit and collections.”