Will HBO Max Grow Into Its Content Budget?
AT&T (NYSE: T) is pouring a lot of money into content for HBO Max, the forthcoming streaming service from its WarnerMedia subsidiary. It committed to increasing HBO's original productions budget by 50% to about $1.5 billion. It's also creating original content exclusively for HBO Max, and it's licensing a lot of programming from itself and other media companies to provide "10,000 hours of premium content."
All told, the content on HBO Max will cost WarnerMedia between $2.4 billion and $3.9 billion per year, according to a recent estimate from Barclays analysts. That doesn't include the extra $500 million it's spending on HBO originals.
For reference, Disney (NYSE: DIS) plans to have less than $2 billion in content expenses in its first year of Disney+, but that number will grow to between $4 billion and $5 billion by 2024. The company expects to reach profitability that year with 60 million to 90 million subscribers.
Source Fool.com
