HBO’s Parent Company, AT&T is reportedly close to striking a $159 billion merger deal with Discovery.
The deal will bring together Hollywood’s biggest studios, Warner Bros and Discovery to create a new streaming giant. According to reports, the new business would be separate from AT&T (The telecoms arm).
AT&T owns CNN, HBO and Warner Bros, after acquiring Time Warner for $108.7bn in 2018.
merger could hasten HBO’s African launch
The battle for the streaming market is heating up and the AT&T empire took its first major step with the acquisition of Time Warner and HBO in 2018. However, with this planned merger with Discovery, the company could be looking to usurp Netflix dominance.
A significant part of that is expansion. In January, HBO Max announced its intention to expand its reach into Africa, the Middle East, and Europe.
The streaming service has selected the region’s leadership team ahead of expansion. Christine Sulebakk was appointed as HBO Max general manager across Europe, the Middle East and Africa (EMEA).
However, HBO has not announced or indicated the exact dates when video streaming service would be made available in sub-Saharan Africa.
Before now, Sulebakk mentioned in a media statement that it may take a couple of years.
However, the the merger could hasten the timeline and the service could be launched sooner with the new influx of funds. Currently, Discovery’s market value, including debt, currently stands at around $30bn.
Africa’s streaming market
Africa has seen massive growth in the video streaming industry. In South Africa, MultiChoice recently added two of HBO’s competitors, Netflix SA and Amazon Prime Video to its network. This translates to more subscriber for the streaming companies outside the US.
HBO and HBO Max have around 64 million subscribers worldwide. This is currently dwarfed by Netflix’s over 200 million subscribers, and Disney+ over 100 million subscribers.
However, the streaming platform’s numbers could see significant growth if Discovery’s portfolio is leveraged. Discovery is currently in more than 88 million homes while its Discovery+ streaming service has 15 million subscribers.
Another plus in its impending launch in Africa is that HBO Max isn’t unknown on the continent. Its record-breaking series like Game of Thrones, Watchmen, Titans etc are well watched by Africans.
Although most of its movies are currently watched on secondary platforms, when it eventually launches, its unique portfolio could help it garner many subscribers as Africans will welcome a platform to watch all its series in one place.
Another implication is that, like Netflix, HBO Max may increase the acquisition of local content to satisfy its subscribers when it launches.
It could also create more jobs for African citizens in the company. For example, the launch of Netflix created Netflix Naija and Netflix SA Twitter accounts so HBO Max may follow their steps.
The completion of the Merger deal would mark the entry of another major player into the streaming market.
The result of combining the powers of the movie-making powerhouse, Warner Bros. Entertainment, which is home to the Harry Potter and Batman franchises, and Discovery’s stable of cooking, nature and science shows is one to watch out for.
However, a major byproduct of the deal could be a hurried expansion into new markets like the middle east and Africa.
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