Yahoo Finance Warner Bros. Discovery CEO David Zaslav on streaming: 'This is really a war'
Warner Bros. Discovery (WBD) CEO David Zaslav is prepared for battle as streaming competition escalates.
"This really is war," Zaslav said at MoffettNathanson's Inaugural Technology, Media and Telecom conference on Thursday, noting the company has certain "artillery" at its disposal — like its content — to reach consumers effectively and curb subscriber churn, a prominent challenge within the current streaming market.
The executive went on to describe that market as "disruptive," adding, "a lot of what's going on makes no sense — big overspend, pricing of the products are too low."
"Imagine you were back 30 years ago and you wanted to watch CBS and you had to download and buy something. And then you want to watch ABC [but] had to download and buy something. ...It's not a good consumer experience," he continued, predicting "a lot of changes" over the next few years.
"We're going to try and push toward that change because we have a lot of great content," he said, calling out popular programming like "House of the Dragon," "The Last of Us," "Succession," "White Lotus," and "Euphoria."
Zaslav also touted WBD's role in sports and news as the company weighs its next NBA media rights deal and rebrands CNN: "As we go into this war, we have all of that artillery with us."
Zaslav reiterated HBO Max — which will officially turn into "Max" next week — will be profitable in the US this year, one year ahead of the company's previous guidance.
"I think that's a huge deal for us. It's a huge advantage," Zaslav said at Thursday's conference.
In April, Warner Bros. Discovery unveiled key details regarding the upcoming streaming launch, which will include content from both HBO Max and Discovery+ as Zaslav looks to leverage the company's wide portfolio of assets to boost subscriptions.
The platform, set to launch May 23, will include three different tiers: $9.99/month for the ad-supported version, $15.99/month for the ad-free option, and a new "ultimate" ad-free tier for $19.99/month that allows four concurrent streams and 4K streaming options, according to the website.
With the exception of the new "ultimate" tier, those prices match up with current HBO Max pricing. Earlier this year, the company increased the cost of its ad-free plan from $14.99 a month to $15.99 in the US.
Earlier this month, the media giant saw streaming losses reverse in the first quarter as subscriber growth came in above consensus estimates. Warner Bros. Discovery reported direct-to-consumer adjusted EBITDA of $50 million in the first quarter, a $704 million year-over-year improvement on a pro-forma combined basis.
"We’ve come through some major restructurings and have repositioned our businesses with greater precision and focus," Zaslav said in the earnings release. "And we see a number of positive proof points emerging, with [direct-to-consumer] perhaps the most prominent."
Warner Bros. Discovery shares are up roughly 30% year-to-date.
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on Twitter @allie_canal, LinkedIn, and email her at alexandra.canal@yahoofinance.com
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