HBO is seeking to renegotiate its deals with distributors such as Comcast and AT&T to enable the pay-cable channel to get more out of the arrangements, Bloomberg reports.
The report notes that HBO added almost 3 million U.S. subscribers last year, capping off its largest two-year gain in 30 years. However, much of the money from those subscriptions is going to the distributors.
As the distribution deals are renegotiated, HBO wants to maximize the role of its digital subscription service HBO Now.
“The deals are the first with major cable providers since the network introduced HBO Now in April 2015,” Bloomberg notes. “The test is whether HBO’s negotiating leverage with pay-TV companies has been diminished by the fact that consumers can get an online version of HBO in many more ways, such as Apple TV, Xbox or PlayStation.”
The report adds: “HBO argues that its online channel hasn’t led to a rise in cord-cutting, and it’s trying to persuade pay-TV providers to package HBO Now with broadband Internet for young or thrifty customers who were never going to buy the full suite of pay-TV channels anyway.”