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HBO could make a fortune by making cord cutters’ dreams come true

Published Aug 27th, 2014 10:30PM EDT
HBO Standalone Streaming Service

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HBO has a brand-new reason to offer a standalone online streaming service other than making cord cutters very happy — it could also rake in huge sums of money. Ars Technica points out that a new research note from Barclays Capital analyst Kannan Venkateshwar, who projects that HBO could generate an additional $600 million per year by offering its content online and apart from cable bundles.

FROM EARLIER: HBO inches closer to making cord cutters’ dreams come true

Venkateshwar thinks HBO has two options for making a standalone content streaming service that would let it preserve its relationships with cable providers: First, it could offer a service that would let users stream content between 6 months to 12 months after originally airing, which he thinks HBO could charge $11 per month to access. The second option would be to let users stream all content as it becomes available but to charge them $18 per month for it, which would be more than what they’d pay for HBO with a cable bundle.

The analyst believes that between 4.4 million and 6.6 million households would be interested in the $11 package while less than 1 million would be interested in the $18 package. Either way, it looks like HBO could offer a standalone streaming option without significantly angering its cable partners that would also give it a significant and immediate revenue boost. What’s not to love?

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at BGR.com and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.