Cutting the cord won't be easy for HBO

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How can the network expand its HBO Now streaming service to compete with Netflix without damaging its cable platform?

As a fan of "Curb Your Enthusiasm," I was certainly happy to hear the news of an upcoming ninth season on HBO in 2017. After a six-year absence, "Curb" will go down in the record books as the TV show with the longest hiatus between seasons in history. 

"Curb," of course, is one of the reasons why HBO is still the prime example of a network brand built via quality programming. It boasts current hits like "Game of Thrones," "Veep," "Girls" and "Silicon Valley," and classics like "The Sopranos," "Sex and the City," "Entourage," "The Newsroom," and "True Blood." While there have been a few exceptions over the years, anything original airing on HBO seems to have an automatic creative edge. But as cord cutters continue to source their TV programming via Internet-based services, the business of cable as we know it is in danger of extinction, and even HBO’s impressive content might not be enough to keep its nascent streaming service afloat.

HBO still does the majority of its business on cable ("linear" viewing, as it is now commonly known), with an estimated 114 million subscribers across the globe. "If it ain’t broke, don’t fix it," so to speak. In April 2015, parent company Time Warner introduced the streaming service HBO Now in response to the cord-cutting debacle. The platform allows consumers to access the pay channel directly — on any device — without a cable subscription.

Five years earlier, the network had launched HBO Go, another streaming service available exclusively to HBO subscribers. The goal for both services, like newcomer CBS All Access, is to offer another avenue for content in the new world of streaming while not cannibalizing the audience of the parent property. It is a fine line to draw, but a necessity for any media outlet that wants to move forward.

Now HBO wants to create more original content to launch in international markets. And it is trying to cash in on the Netflix model, attempting to make itself accessible anywhere you might want to watch TV, not just the TVs that are tied to a cable package.

Last year, HBO chief Richard Plepler stressed that less than 1% of HBO subscribers had canceled their cable service after the debut of HBO Now. But as of the fourth quarter of 2015, HBO Now had only a reported 800,000 domestic paying subscribers, versus more than 75 million internationally for Netflix.

Ironically, Netflix, the current king of the streaming services, had originally patterned itself after HBO by focusing on the caliber of its programming. Netflix, of course benefited by pioneering the concept of streaming at a time when the concept was in its infancy. After its first 5 years of streaming, Netflix had 26.5 million subscribers.

HBO Now, in contrast, is trying to find a piece of the pie in a very currently cluttered marketplace, which is no easy feat. To help its cause in finding new subscribers, here are a few suggestions that might help.

Continue to focus on the original product, but consider some repackaging
Like CBS All Access, which will introduce the new "Star Trek" series and the spin-off of "The Good Wife," one option could be to create original product specifically for HBO Now in the hope of spiking the number of subscribers. Since the jury is still out on CBS All Access — no one knows for sure just how many people will sign up for the new "Star Trek"  — I would offer additional original footage from already established HBO hit series only on HBO Now. Give the die-hard fans the option for more content while not negatively impacting the parent platform. Cable subscribers would still get a full episode of Game of Thrones, for example, and could subscribe to HBO Now for bonus footage, similar to DVD extras.

Lower the cost
HBO Now costs $14.99 per month. That may not sound like all that much, but all of the various services the consumer is paying for outside – or instead of – traditional cable really add up. And Netflix is only $8.99 per month.

Utilize sister channel Cinemax
Cinemax, another arena for a growing slate of original series (such as the underrated drama "The Knick"), and a catalog of hundreds of movies, could also be a draw for added subscribers on the fence about HBO Now.

Keep extending the service to new platforms
When HBO Now launched, it was only available exclusively on Apple devices for the first three months.  Just two months ago, HBO Now introduced software for Xbox 360 and Xbox, and Playstation is expected next. Keep it coming.

Make sure HBO now is available at all times
With plans to increase its original programming by a reported 50% in the coming year, HBO understands the value of its product. ButHBO Now users were unable to access the service this past Sunday for what many referred to as the biggest episode of "Game of Thrones" ever. HBO apologized on Twitter for the outage, citing an overload of the network from subscribers as the reason the service failed. But this is not the first time it has happened, and rabid fans who miss their favorite shows have very long memories.

With so much competition, HBO needs to get its act together … Now. A little fan service wouldn’t hurt, either. I would immediately offer all episodes of the first eight seasons of "Curb Your Enthusiasm" on HBO Now to whet the appetite of fans like myself who can’t wait to get the sitcom back. That alone might get me to sign up.


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