HBO Max and AT&T Have Everyone Angry At Warner Bros

Images via WarnerMedia

HBO Max has been an unmitigated mess. Back in October of last year, I broke down my thoughts about the streaming services. “Disney+ looks like it’s going to be at the head of the pack in the streaming wars, but HBO Max feels like the one to beat. The content split problems I noted above for Disney+ and Hulu? They’re not a problem for HBO Max. It’s the ur-service for WarnerMedia and it has everything,” I wrote at the time.

Sadly, things haven’t worked out that way.

Last week, AT&T and Warner Bros. Pictures Group announced that the entire 2021 film slate would be moving to a simultaneous release in theaters and on HBO Max. The films will launch in both markets for 30 days, before moving to theaters only for the next 30 days. The films included in this are heavy-hitters: The Matrix 4, Godzilla vs. Kong, Dune, The Suicide Squad, The Conjuring: The Devil Made Me Do It, In The Heights, and Space Jam: A New Legacy are among the films included in the shift.

This follows last month’s announcement that Wonder Woman 1984 would be seeing a similar hybrid release model. The logic of that shift was clear: the earlier release of Christopher Nolan’s Tenet proved that box office under the COVID-19 pandemic wasn’t going to be all that strong. Tenet only made $57 million domestically, putting it at #14 on this year’s chart. That’s behind films that released prior the pandemic, like Bad Boys for Life, Sonic the Hedgehog, and even WB’s own underperforming Birds of Prey: And the Fantabulous Emancipation of One Harley Quinn.

Tenet was able to get to $359 million worldwide, but that’s still a wildly depressed box office compared to 2019. Warner Bros was looking towards 2021 with a slate of potential box office hits, but no box office to speak of.

The hypercolor queen won, but those who follow…?

Plans Can’t Fail If There’s No Plan, Right?

The problem is that Warner Bros was entirely too hasty with this move. Switching over Wonder Woman 1984 was fine; WB management talked with that’s film principals, Gal Gadot and Patty Jenkins, and made sure they were happy with back-end payments given a hybrid release. But it’s become increasingly clear that this week’s announcement came as a shock to everyone.

“Some of our industry’s biggest filmmakers and most important movie stars went to bed the night before thinking they were working for the greatest movie studio and woke up to find out they were working for the worst streaming service,” Nolan told The Hollywood Reporter in a report released today. Savage.

Dune director Denis Villeneuve, In the Heights director Jon Chu, and The Suicide Squad director James Gunn are also listed as creatives surprised and angered by the move. “Warners has made a grave mistake. Never have this many people been this upset with one entity,” an anonymous talent agent told THR. Some creatives wanted a theatrical release for their films. Others are incensed about their back-end money; WB gave Gadot and Jenkins a sweetheart deal, but those numbers aren’t being extended to other filmmakers.

Exhibitors are incensed because a simultaneous streaming/theatrical release obviously cuts out any potential legs for the theatrical run. Worse, the release of films on streaming 4K means excellent copies of those films will be pirated on day one.

Legendary is prepared to fight, just like these titans.

Then there’s the ire from Warner Bros.’ development partners. Legendary Entertainment, who co-developed Godzilla vs. Kong and Dune with WB, was angry to hear of the change. According to THR, Netflix previously offered $225 million for Godzilla vs. Kong, which Legendary financed 75% of. Warner Bros stepped in and vetoed the deal. With the move to HBO Max, Legendary is looking at making far less in profit on the venture. That may reportedly lead to a legal challenge.

In WB’s defense, some are pointing towards the COVID vaccines, with the hope that normal filmgoing will resume sometime in 2021. Even if vaccine distribution goes off without a hitch — which I doubt — I think we’re looking at a few years of depressed box office, especially from the heights of 2019. But even given that, it would’ve made sense for WB to talk to its partners and perhaps move films to HBO Max on a case-by-case or quarterly basis. Doing the whole year in one fell swoop, without talking to anyone, is foolhardy.

So why did WarnerMedia do it? The current guess is the change came from parent company AT&T. And the motivation seems to be the underperformance of HBO Max.

I do question if Dune would’ve been a big box office hit in normal times.

The Dark Times

HBO Max is struggling on several fronts. Back in October, AT&T reported that it had 38 million domestic subscribers across HBO and HBO Max. That’s slightly ahead of expectations, but buried in further documentation we see that only 8.6 million activations of HBO Max happened during the quarter. If you have a subscription to any version of HBO, you get access to Max for free; so there are 28.7 million HBO subscribers than haven’t switched over for whatever reason.

In some cases, that’s because those viewers only care about HBO. Sticking with the existing service and app is a form of customer inertia. Worse, there’s a lot of confusion around the HBO brand. If you were using the HBO Go app, available to cable subscribers of HBO, that’s gone completely. If you were using HBO Now, the standalone streaming service, that’s now just the HBO app. And Max is everything HBO, with additional content from the rest of the WarnerMedia library.

That’s already confusing for folks, but it gets worse. The HBO Max app isn’t available on every platform the previous apps were. At launch, it skipped Amazon Prime/Amazon Fire devices and Roku. Amazon and WarnerMedia buried the hatchet in November, but HBO as a Prime video channel was axed as a result. A Roku deal is rumored, but hasn’t happened yet. If you were lucky enough to buy a PlayStation 5 recently, there’s also no version of HBO Max on that platform.

The service’s problems persist elsewhere. It lacks support for enhanced presentation options like, 4K , HDR 10, Dolby Vision, and Dolby Atmos. Those options will be coming to Wonder Woman 1984 when that launches on December 25, 2020, but support for other movies and shows is coming “throughout 2021”, with no firm schedule.

WarnerMedia also lacks access to its entire catalog. When HBO Max launched, it missed many of the Superman films. Superman eventually returned, but Batman Begins and The Dark Knight left for NBCUniversal’s Peacock streaming service in August. Not having all the DC films in the “DC” tab on Max is simply a bad look. In contrast, Disney went above and beyond, re-purchasing the rights to the Star Wars films from Turner so Disney+ would have most of its heavy-hitters at launch; WarnerMedia doesn’t seem to be interested in doing the same.

HBO Max was sold as the best of everything WarnerMedia, with everything in one place. Instead it’s all of HBO, but only part of Turner Classic Movies, part of Crunchyroll, part of DC Entertainment, and more. It’s a start, and a rough one to be sure.

A flagging streaming service and careless upper management equal an entire industry angry at one studio. The move was obviously intended to turn all eyes toward HBO Max, and it did, just not in the way AT&T and Warner Bros. intended. Outwardly, It might help the service with the audience, but behind-the-scenes, Warner’s management has to soothe creatives and likely jockey to pay a lot of money to some folks.

It all smacks of the same problems that Warner Bros. had in setting up the DC Expanded Universe. In chasing Disney and Marvel’s Avengers, WB moved too fast, trying to reach those box offices highs without doing the films right. Focus on the creative drive, on an excellent film, and things (may) work out. Focus on overnight success and you’ll probably fail.

I still think HBO Max has all the films and shows to be a winner, but WarnerMedia has to do it right. Keep the filmmakers happy, consolidate the content, make sure the service is available everywhere, and have a concrete plan outside of “SUBS!” And maybe talk to your partners instead of just springing industry-changing moves in a press release.

Reviewer at @PCMag, among other things. Black guy, glasses, and a tie.

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