Paramount Skydance plans to combine Paramount+ and HBO Max into one streaming service after emerging victorious in the bidding war for Warner Bros. Discovery.
Paramount CEO David Ellison told investors the combined streaming service would have around 200 million subscribers.
This comes after Paramount and Warner Bros struck an agreement to sell Warner Bros for US$31 per share after Netflix backed out of the bidding war.
“We think that really positions us to compete with the leaders in the space,” Ellison said on a call with investors.
“At Paramount, by the middle of this year, we’ll have completed the consolidation of our three services under one unified stack, and you can see us taking a similar approach to this platform going forward.
“And we think the combined offering, and given the amount of content and what we can do from the tech side, really will put us in a position to be able to compete with the most scaled players in DTC.”
The call didn’t make it immediately clear how the company will price the combined service or what it would be called.
Ellison did make it clear that it wouldnt disrupt the HBO brand.
“HBO should stay HBO,” he said, citing its long history of quality programming.
HBO is likely to be a sub-brand of the larger service, according to someone familiar with Paramount’s plans.
It is also unclear what the new streamer's name will be, but it will likely result in another rebrand for the Warner Bros streamer.
Just this past summer, the streamer rebranded back to HBO Max after spending two years as Max, following earlier iterations as HBO Now and the original HBO Max.
The 200 million subscriber figure could shrink under a combined service, given subscriber overlap between the platforms.
At the end of Q4, Paramount had 78.9 million direct-to-consumer subscribers, while Warner Bros. had a reported 131.6 million.
When Netflix and Warner Bros were still in merger talks, Netflix co-CEO Ted Sarandos told lawmakers that 80% of HBO Max subscribers also have Netflix accounts. Netflix has over 325 million subscribers.
As part of the merger, Paramount will also acquire CNN, which is currently owned by WBD.
During Monday’s call, Ellison told analysts that Paramount has “no divestitures planned at this time” regarding cable — meaning the company does not plan to sell cable assets.
At the time of writing, Paramount (NASDAQ: PSKY) stock fell 1.26% to $13.34. It rose 0.45% in after-market trading to $13.40.
Warner Bros (NASDAQ: WBD) stock rose 1.17% to $28.50. It fell 0.07% in after-market trading to $28.48.
Paramount’s market cap is $14.72 billions, and Warner Bros is $70.68 billion.
