The concept of HBO Go has been in development for at least 5 years. HBO Go evolved from the HBO on Broadband service that launched in 2008 on Time Warner as a trial in Wisconsin. The service was limited to Time Warner Road Runner customers and only available to in-home viewers. The development of the current HBO Go app actually began with the HBO website on Verizon in 2010. When HBO began to see the impact of the iPad, it recognized the growing opportunity on mobile devices, and development of the app accelerated over the past year and culminated with the April 2011 launch. Additional considerations on the timing of the launch included programming opportunities, advertising opportunities, and affiliate launches with the nationwide campaign beginning in early May.
HBO has huge brand recognition, premium content, and a large customer base. I wanted to know why it would even bother with a mobile app. Deutmeyer responded, “Looking at the success of HBO On Demand, which allows viewing on the customer’s schedule, we saw that it had a positive impact on the bottom line. It was a great way to reduce [customer] churn by increasing the overall usage of HBO and customer loyalty to the brand. Today we see much more consumption of premium content on new platforms and not just television anymore. There is the consumer expectation that you can get your content on your computer, your tablet, your smartphone, wherever you are. Ultimately we are trying to increase customer satisfaction and get more people to watch HBO.” Since HBO Go is relatively new, I was interested to learn if there was enough data yet to determine if the app was having a positive impact. Deutmeyer continued, “At the beginning of April when we launched the app, only about 10% of our subscriber base had access to the app, while by the end of April about 80% had access. The app is still in its early stages, but all of the research and feedback we are getting from consumers has been very, very positive. But it is too early to quantify it.”
On the technical side, the H.264 codec is used to produce the video, and the content protection varies by platform. Content protection is of utmost importance given the high-value content HBO owns and licenses from studios. It does all encoding and managing of the DRM internally. HBO is using adaptive streaming of content on all of the platforms. With large amounts of content being encoded to multiple devices, a number of video profiles are used for each platform. The content has to be suitable for low-bandwidth handheld devices as well as high-definition encodes for tablets and desktops. HBO uses some of the larger CDNs for distribution, and HTML5 is something it is evaluating for the future. While HBO Go is available from many providers, it is not yet available from all of them. HBO is currently in discussions with additional providers to bring HBO Go and MAX Go to more subscribers and expects a greater number of providers to offer the service in the very near future.
HBO has leveraged its premium content into a successful video app by focusing on providing an exceptional consumer experience and developing new platforms for delivering that experience.
Back to the Future
I asked each of the executives their thoughts on the future of their apps. Each one expressed their goal of providing content to as many devices as possible. These devices included not only the current generation of mobile devices but also game consoles, Blu-ray players, and Connected TVs.
Each has already developed an app for the Connected TV platform or sees it as a direction they will definitely pursue in the very near future. Each of the executives cited the application stores created by television manufacturers such as Samsung, LG, and Vizio as platforms for their applications. So while we are focusing much of our development on mobile devices, a significant opportunity is emerging for each of these companies to expand into the next generation of television with their apps and to continue to reach the greatest numbers of viewers.
This article originally appeared in the October/November issue of Streaming Media under the title, "The Apps the Thing."