License agreements apply brakes to HBO Max distribution in Europe

WarnerMedia will launch its HBO Max streaming service in Europe this year but is still struggling with lucrative licensing contracts that represent the biggest hurdle of expansion in the two largest markets. most on the continent.

Jason Kilar, chief executive of the media agency for HBO Max, has global goals but cannot stream the service to the UK, Germany or Italy as HBO content and some Warner Bros. movies are only allowed through Sky until at least 2025.

Kilar told the Financial Times that he is “spending a lot of time thinking about what will happen” after Sky’s contract runs its course. “We have a great opportunity to have HBO Max in the UK, Germany and other markets. Of course I’m thinking a lot about that, ”he said.

After Kilar’s inauguration last year, WarnerMedia explored options to redesign its relationship with Sky, according to people familiar with the matter, but who did not renegotiate a contract. . WarnerMedia said HBO Max will not be launched in these areas “during the term of this partnership”.

Former WarnerMedia chief executive John Stankey, who was promoted to AT&T’s parent company, broke the deal in 2019, extending a long-term relationship with Sky and donating money into AT&T with huge debts.

But it hampered the company’s ability to expand their huge streaming bet, HBO Max, to critical markets outside the U.S. Europe is the second largest revenue market for Netflix, which receives nearly two-thirds of its 204m subscribers from countries outside the U.S. and Canada.

Kilar, a streaming pioneer as the founder of Hulu in 2007, was hired last year to design one of Hollywood’s most valuable catalogs – spanning a Warner Bros. film and television studio, an HBO network and a package of cable channels – into a user. -facing a streaming platform to compete with Netflix.

The company last year discontinued HBO Max for $ 15 per month in the US.

Kilar is heavily focused on global distribution, said WarnerMedia and former officials. The 49-year-old has said one of Hulu’s “biggest regrets” was not launching the service internationally, which he believes has kept Hulu back from being a hitter. growing as big as Netflix.

Kilar last year rejected an offer from Discovery to allow Warner programs in Latin America, according to people familiar with the talks.

In an interview, Kilar criticized AT & T’s previous decisions regarding Europe’s “lack of condemnation” across the industry.

“Whether they’re looking at Disney, then called Time Warner, any mainstream media companies. . . they were not convicted of the [streaming video] global opportunity for early entrants [such as Netflix] rinn. I say that with confidence because I was in the middle [at Hulu], back in 2007, ”he said. “Why isn’t HBO Max in 190 countries today? Because of that history. “

HBO has worked in Europe, Latin America and Asia for decades, licensing its programming to local broadcasters and pay-TV companies across more than 20 countries. As well as distributing popular HBO series like Game of Thrones, also produces local language programming.

HBO Europe in recent years has been a competitor to Netflix in the region, pushing its own direct-to-consumer streaming service in the Nordics, Spain, Portugal and other countries.

This will be rebranded as HBO Max in the second half of this year. A similar launch is set for HBO Max in Latin America in June, where it will enter 39 new areas.

“As a leader, I need to make sure we put out a record for as soon as we go global,” Kilar said. “We’re 10 months in, and going from 1 to 61 countries, and we won’t stop there. ”

Sky, which is owned by Comcast, has recently been spending more on original content, including through a co-production contract with HBO. To become a collector of streaming services, he has also reached contracts to carry Netflix, Disney Plus and Discovery Plus on the platform.