HBO is going to let viewers binge-watch its new shows online before they air on TV – at least that’s what Netflix thinks.
On Wednesday, Netflix posted impressive Q4 earnings, smashing its targets for subscriber growth both in the US and internationally. The company painted a rosy vision of the future of its industry.
“In short, it’s becoming an internet TV world,” Netflix wrote in a letter to shareholders. “Which presents both challenges and opportunities for Netflix as we strive to earn screen time.” And Netflix thinks that at least one old rival, HBO, will adapt to the digital future by making its shows available to binge early.
Netflix’s head of content, Ted Sarandos, famously said in 2013 that Netflix’s goal was to “become HBO faster than HBO can become us.” Netflix, at the time, was pivoting toward producing its own high-quality original shows (like HBO). And Sarandos was implying that HBO would try and move toward global, digital distribution to keep up with Netflix – see initiatives like HBO’s “a la carte” streaming service, HBO Now.
But even as their business models inch toward each other, one thing that has continued to separate HBO and Netflix, besides the fact that Netflix spends about 3 times as much money on content, is that HBO releases shows one episode at a time, whereas Netflix drops entire seasons at once. The release of each new “Game of Thrones” episode is an event, especially on social media.
That type of repeated buzz seems like it would be a hard thing to give up, but Netflix thinks HBO will see the light and embrace binge-watching as a business model. “The BBC has become the first major linear network to announce plans to go binge-first with new seasons, favoring internet over linear viewers,” Netflix wrote in its letter. “We presume HBO is not far behind the BBC.”
In the letter, Netflix links to an article from The Telegraph, which indicates that the BBC will start making full seasons available to binge before they air. “The BBC will make its major Sunday night dramas available in their entirety on iPlayer before screening them on television, under plans that would turn the catch-up service into a rival to BBC One and Two,” The Telegraph reports.
HBO, Netflix presumes, is not far behind.
This doesn’t necessarily mean Netflix thinks HBO will start dropping full seasons of blockbuster shows like “Game of Thrones” and “Westworld” any time soon. It could be that Netflix thinks specific types of shows will be available to binge on HBO’s streaming services, HBO Now and HBO Go.
But even if its only certain shows, changing its release pattern would be a significant step for HBO, and a big vote of confidence for Netflix’s model.
That’s why you should probably take anything Netflix says on the subject with a grain of salt, as its partly a playful jab at a competitor, tinged with a dose of self-interest, and a big wink.