Q. I read online that HBO Max thinks that Roku and Fire TV will add it during the holidays when people are buying electronics more than normal. Do you think that’s true? And why wait until then? — Richard, Buffalo, New York.
Richard, let me first offer some background for our readers who are not familiar with the dispute.
HBO Max, a streaming version of HBO (but with a bigger lineup), launched on May 27. However, more than two months later, Roku and Amazon’s Fire TV still do not carry it. While the companies won’t divulge specifics, they are believed to be fighting over how much HBO Max should pay the two streaming devices as well as certain marketing considerations.
The skirmish has surprised many industry observers because AT&T, which owns HBO Max, is investing heavily in the new streaming service. But it still hasn’t secured deals with the nation’s two leading streaming devices which carry HBO Max’s biggest rivals, such as Netflix, Hulu and Disney+.
Jason Kilar, CEO of Warner Media, which oversees HBO Max for AT&T, was asked about the fee fight during a recent interview with Bloomberg News. He suggested that Roku and Amazon will likely capitulate to their demands during the holiday season because they risk losing device sales to rivals such as Apple TV 4K. (Apple TV 4K does carry HBO Max.)
“As we head into the fourth quarter, when gift giving happens, it becomes a more material situation for a seller of hardware,” Kilar told Bloomberg.
Kilar is correct that consumer electronics companies rely heavily on holiday sales to boost their annual numbers. But I believe he’s wrong to assume that Roku and Amazon will conclude that they must have HBO Max or otherwise lose Christmas sales to Apple, or other devices that carry it.
Roku and Fire TV still offer HBO, the streaming version of the pay TV channel’s lineup. For many consumers, that may be enough. They don’t necessarily need HBO Max’s added programming which includes such shows as The Big Bang Theory, Friends, Doctor Who and TCM movies.
To make matters worse for Kilar and company, many consumers don’t necessarily understand that there’s a difference between HBO and HBO Max. They just know that they can still get ‘HBO’ from their streaming device of choice.
AT&T has struggled to communicate the difference between the two services. (The early miscommunication was heightened by the existence of two other HBO names, HBO Now and HBO Go. AT&T last month finally eliminated HBO Go and changed the name of HBO Now to just HBO.)
The confusion in the marketplace has cheapened HBO Max’s potential value, and diminished AT&T’s leverage at the negotiating table.
Bottom line: AT&T might find a way to get Roku and Amazon to sign up before the year’s over. But the company shouldn’t hope that they will feel extra pressure to do so.
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— Phillip Swann